U.S. Senate Banking Committee Member Pat Toomey (R-Pa.) is asking for more information after learning that the Federal Deposit Insurance Corporation (FDIC) may be improperly deterring banks from doing business with lawful crypto companies.

According to whistleblower reports, personnel in the FDIC’s Washington, D.C. headquarters are urging its regional offices to request that banks refrain from expanding relationships with crypto companies, without providing any legal basis for taking such action. The FDIC’s headquarters reportedly distributed draft letters to regional offices to send to banks.


In a letter to FDIC Director and Acting Chairman Martin Gruenberg, Ranking Member Toomey expressed concerns about the FDIC’s alleged interference in these lawful business activities.


“My office has received information from affected parties and protected whistleblower communications alleging the FDIC is taking such actions, even though the FDIC has not determined that these companies are providing services that are unlawful or impermissible, or that it is unlawful or impermissible for FDIC-supervised banks to do business with these companies. Given the FDIC’s involvement under your leadership in the Obama administration’s notorious Operation Choke Point, which sought to coerce banks into denying services to legal yet politically disfavored businesses, it is important to better understand the actions the FDIC is now taking and the legal basis for them.”


Whistleblower reports also allege that the FDIC may be abusing its supervisory powers to deter banks from extending credit to crypto companies.


“According to these reports, FDIC headquarters employees have contacted FDIC regional office bank examination staff to question their review of a loan made by a bank to a crypto-related company and to urge them to downgrade their classification of the loan. It is my understanding that it is highly atypical for FDIC headquarters personnel to be involved in reviewing an individual loan. If reports are true that there was nothing unusual about this loan (other than that it was to a crypto-related company) and that the loan amount was too small to affect the bank’s supervisory rating even if it had to write off the entire loan, this episode raises important questions.”


Ranking Member Toomey concluded by asking Acting Chairman Gruenberg to turn over documents and answer a number of questions concerning the FDIC’s actions no later than August 30, 2022.


Read Ranking Member Toomey’s full letter to Acting Chairman Gruenberg here.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s