Brex Inc., a technology company seeking to disrupt the credit card industry, has hired Frederick Reynolds as its first chief compliance officer.
Reynolds, who spent the past four-and-a-half years as a managing director and global head of financial crime, employment, and competition at Barclays PLC in New York, started his new role at Brex last week.
The company, founded in January 2017 by two college dropouts from Brazil, is one of several startups seeking to shake up the corporate credit card business. Brex was valued at $7.4 billion in April after raising $425 million in a funding round led by Tiger Global Management LLC.
Reynolds said several factors enticed him to move from an established financial services player like Barclays to an upstart like Brex, whose employees will remain fully remote even after coronavirus pandemic-related workplace restrictions end.
“I saw a lot of my peers at large institutions and banks trying to figure out what they’re going to do post-pandemic,” said Reynolds, who prior to working at Barclays spent two years as a managing director at Bank of America. “Brex in many ways was more productive going fully remote, so they’ve really embraced it.”
While big banks have provided various services and verticals to clients that have remained relatively unchanged over the years, Reynolds said he was impressed by Brex’s focus on becoming “the future of finance.”
Brex has been busy in recent months moving beyond credit cards by building out new products lines like business cash accounts and bill pay software.
“This was a good time for me to come in and evolve and grow with the business,” Reynolds said. “Compliance shouldn’t be an inhibitor on the business, but a partner that scales with it.”
Graham James, a Brex spokesman, said the company has a number of law firms on retainer but has been working on its new compliance program with Juan Zarate, global co-managing partner and chief strategy officer for K2 Integrity Holdings Inc., an investigative and consulting firm formerly known as K2 Intelligence. K2 acquired the Financial Integrity Network, an advisory firm led by Zarate, in 2019.
Zarate is a former senior official at the Treasury Department, where Reynolds spent more than two years as a deputy director of its Financial Crimes Enforcement Network. Before that, Reynolds spent six years at the Justice Department, where he established the criminal division’s first-ever forfeiture unit and was a senior trial attorney in its asset forfeiture and money laundering section.
But it was Reynolds’ work as an assistant attorney general for the Republic of Palau—an island nation in the Pacific Ocean where he spent three years between his time at the Justice Department and the start of his career as a former Big Law associate—where he gained critical front-line experience prosecuting financial crimes and creating the country’s first financial intelligence unit.
“If I had been in the U.S. government at that point in my career, I would’ve been buried six-deep behind other people instead of sitting at the table,” Reynolds said about his time in Palau. “And I became a very good diver when I was there.”
Boom Times at Brex
Reynolds will report to Brex’s chief legal officer Kathryn Biber, a former top lawyer to Sen. Mitt Romney’s (R-Utah) unsuccessful 2012 U.S. presidential campaign. Biber was hired by the company last year from Anchorage Hold LLC, a cryptocurrency custodian backed by Silicon Valley-based venture capital firm Andreesen Horowitz.
Biber said that she’s excited to work with Reynolds, whom she called the right lawyer and leader to head up Brex’s compliance efforts.
“Frederick has a sterling reputation, obvious domain expertise, and the operational prowess to helm the compliance team at a hyper-growth fintech,” said Biber, who was also once legal chief for home services startup Thumbtack Inc. “It was evident early in the interview process that he was the right person for this critical role.”
Under Biber’s leadership, Brex is building out its legal and compliance function.
The company has added more than a half-dozen lawyers this year, including former Wilmer Cutler Pickering Hale and Dorr counsel Elijah Alpher and Yevedzo “Yeve” Chitiga in Washington, both of whom have joined Brex as associate general counsel and senior counsel, respectively.
Maxwell Thompson, assistant general at cryptocurrency trading platform Paxful Inc., was hired as a regulatory counsel. Sasha Gibbons, a veteran financial services lawyer who has worked at BoA, Deutsche Bank AG, and most recently Truist Financial Corp., is now senior counsel for technology and privacy.
Brex also hired associate general counsel Ryan Marsh and Conway Ekpo from their roles as the LendingClub Corp.'s vice president of litigation and executive director for legal in Morgan Stanley’s wealth management business, respectively. Patrick Ekeruo, general counsel at fintech Jaris Inc., became a senior corporate counsel this month.
Late last year Brex also picked up a pair of senior directors and associate general counsel in Emily Goodman, who spent the past decade in-house at American Express Co., and Adam Lesman, most recently general counsel at fintech ODX LLC.
There have been some exits. Ashton Simmons, a former regulatory and compliance counsel at Brex, left the company earlier this year to take a regulatory counsel position at Adyen BV, a growing Dutch payments platform that went public in 2018.
While compliance had been part of Simmons’ portfolio and other Brex employees, Reynolds said he’s responsible for the company’s entire compliance program, overseeing everything from its bank charter application to Bank Secrecy Act-related matters, broker-dealer issues, and data privacy and security.