FDIC

Subscribe to FDIC

The Federal Reserve Board, Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency have issued a joint statement on crypto-asset risks to banking organizations.  The term “crypto-asset” refers to any digital asset implemented using cryptographic techniques.

The statement begins with the agencies’ observations that “[t]he events of the past year have been marked by significant volatility and the exposure of vulnerabilities in the crypto-asset sector” and that “[t]hese events highlight a number of key risks associated with crypto-assets and crypto-asset sector participants that banking organizations should be aware of.”… Continue Reading

On December 13, 2022, the FDIC issued a request for comment on a proposal to modernize the regulations governing use of the FDIC’s official signage and advertising of FDIC-insured status by insured depository institutions (IDIs), and to clarify regulations issued earlier in 2022 regarding misrepresentations of deposit insurance coverage.  The proposed rule was published in the Federal Register on December 21, 2022 and comments are due no later than February 21, 2023.… Continue Reading

Earlier this week, Senator Sherrod Brown (D-Ohio) introduced a bill, the “Close the Shadow Banking Loophole Act,” (Act) that is intended to close what is often termed a “loophole” in the Bank Holding Company Act (BHCA) because it allows the parent companies of industrial loan companies (ILCs) to operate without the same level of federal oversight that applies to parent companies of other banking institutions.… Continue Reading

We discuss the FDIC’s final rule on misuse of the FDIC name or logo, advisory to insured banks on deposit insurance and dealings with crypto companies, and cease and desist letters to five crypto companies alleging they made false and misleading statements about deposit insurance.  We also discuss the CFPB’s circular warning that a misrepresentation involving the FDIC name or logo can constitute a UDAAP violation. … Continue Reading

A bi-partisan group of nine Senators (five Republicans and four Democrats) recently sent a letter to Acting FDIC Chairman Martin Gruenberg to express their support for the industrial loan company (ILC) charter and to remind him “to ensure the [FDIC] continues to follow the laws that Congress carefully designed for the FDIC to consider new deposit insurance applicants, including ILCs.” … Continue Reading

The White House has announced the names of two Republicans who President Biden is nominating to serve as members of the FDIC Board of Directors.

The FDIC Board of Directors has five members, two of whom are the Comptroller of the Currency and the CFPB Director.  Currently, there are only three members, all of whom are Democrats (consisting of Acting Chair Martin Gruenberg, Acting Comptroller Michael Hsu, and CFPB Director Rohit Chopra). … Continue Reading

We discuss each of the three categories of risk identified in the guidance (consumer compliance, third-party, and litigation), plaintiffs’ legal theories in class actions challenging NSF fees, the role of arbitration clauses and contract language in defending class actions, the FDIC’s suggested risk mitigation practices, issues to consider in navigating FDIC expectations for remediation of self-identified NSF fee issues and plaintiffs’ demands in class action settlements, the position of other federal regulators on re-presentment NSF fees, and state focus on NSF fees.… Continue Reading

On August 19, 2022, the FDIC issued cease and desist letters to five crypto companies, alleging they made false and misleading statements about FDIC deposit insurance and demanding immediate corrective action.  The five companies are FTX US, Cryptonews.com, CryptoSec.info, SmartAsset.com, and FDICCrypto.com.  The FDIC’s actions come weeks after issuing an “Advisory to FDIC-Insured Institutions Regarding Deposit Insurance and Dealings with Crypto Companies” to address the agency’s concerns regarding misrepresentations about FDIC deposit insurance.… Continue Reading