The post United Texas Bank Faces Regulatory Action: Key Compliance Failures in Cryptocurrency Oversight appeared on BitcoinEthereumNews.com.

United Texas Bank, a prominent institution in Dallas, is currently under scrutiny following a regulatory examination. The Federal Reserve and Texas Department of Banking discovered significant weaknesses in the bank’s adherence to compliance protocols, notably regarding virtual currency clients. “Another crypto bank under the microscope reflects the increasing pressure the industry faces from regulators,” noted Caitlin Long, founder of Custodia Bank. This article explores the recent regulatory scrutiny faced by United Texas Bank and its implications for compliance in the cryptocurrency banking sector. Regulatory Oversight and Compliance Deficiencies at United Texas Bank In May 2023, a thorough examination by regulatory bodies led to alarming findings at United Texas Bank. The Federal Reserve along with the Texas Department of Banking identified critical deficiencies in the bank’s risk management and anti-money laundering (AML) compliance processes, particularly concerning its dealings with virtual currency customers. The banks’ failure to meet legal standards, specifically regarding the Bank Secrecy Act (BSA), has resulted in a formal cease and desist order, underscoring the necessity for immediate and robust corrective actions. Implications for Corporate Governance and Oversight The deficiencies noted by regulators not only pertain to compliance but also raise concerns about the bank’s corporate governance practices. The board of directors was indicated to have inadequately supervised the management’s compliance with federal regulations, a crucial failure that further exacerbates the bank’s precarious situation. Regulatory bodies mandated that United Texas Bank create a comprehensive written plan for enhancing governance and compliance protocols in alignment with BSA/AML and Office of Foreign Assets Control (OFAC) requirements within a span of 90 days. Community Response and Industry Outlook Upon the announcement of the regulatory actions, the crypto community erupted in discussions on platforms like X, reflecting unease about the regulatory landscape. Industry leaders expressed concern over the perceived imbalance in regulatory enforcement.…

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Filed under: News - @ September 4, 2024 11:17 pm