- The Federal Deposit Insurance Corp has issued a consent order to Cross River Bank.
- The order directed the crypto-friendly bank to take corrective action and address its unsafe banking practices.
- The FDIC issued the order on March 8 but it was made public on Friday.
The U.S. Federal Deposit Insurance Corporation (FDIC) has reportedly issued a consent order to New Jersey-based Cross River Bank. The bank is widely regarded as a crypto-friendly institution that caters to several businesses operating in the crypto space including crypto exchange Coinbase and USD Coin issuer Circle.
Cross River Bank: Consent Order Will Have No Impact On Growth
According to a report by Bloomberg, the FDIC issued a cease and desist order to Cross River Bank over alleged “unsafe and unsound” banking practices related to fair-lending laws. The consent order was issued on March 8, 2023, but was made public on Friday. The FDIC alleged that the crypto-friendly bank failed to maintain internal controls, information systems, and prudent credit underwriting practices. A spokesperson for the bank clarified that the order was the result of a standard review and had nothing to do with its crypto-related business.
As per the order, Cross River Bank has agreed to address the concerns related to its practices and improve internal controls. However, the bank did not admit or deny any wrongdoing. A spokesperson for the bank stated that the order will have no “meaningful impact” on its growth. Several enhancements laid out by the FDIC in the order have already been completed by the bank. The bank’s board has agreed to increase supervision and oversight of controls and ensure that corrective actions are taken.
Importantly, the order does not identify discriminatory practices or anything that would require Cross River to compensate consumers for harm. Further, it places no limitations on our extensive existing Fintech Partnerships or the credit products we presently offer in partnership with them.”
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