Fed Cracks Down on U.S. Bank for Lapses in Crypto Risk Controls
The Federal Reserve has ordered United Texas Bank to halt operations due to major flaws in its risk management and handling of cryptocurrency clients.
On September 4, the Fed revealed that a recent examination uncovered serious issues in the bank’s corporate governance and risk management related to foreign correspondent and virtual currency transactions. The Fed noted deficiencies in compliance with anti-money laundering laws, including the Bank Secrecy Act.
The order did not specify the exact regulatory breaches but stated that the bank is now working to enhance its anti-money laundering practices and compliance measures. The bank’s board has committed to improving oversight of these requirements.
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United Texas Bank, which has 75 employees and manages approximately $1 billion in assets, has been under scrutiny along with other crypto-friendly banks. In August, the Fed took similar actions against Customers Bancorp for deficiencies in risk management and anti-money laundering practices.
These recent actions have led to claims that the government is attempting to restrict banks from interacting with the cryptocurrency sector, a theory some have referred to as “Operation Chokepoint 2.0.”
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
