The post Fed enforces restrictions on crypto-friendly Customers Bank appeared on BitcoinEthereumNews.com.

The Federal Reserve is cracking down on Customers Bancorp, a bank known for its crypto-friendly approach, forcing it to jump through new hoops before it can continue catering to the crypto industry.  As one of the few banks in the U.S. willing to engage with digital assets, Customers Bancorp now has to give the Fed a 30-day heads-up before forming any new relationships with crypto companies.  The bank even runs an instant payments platform allowing businesses to make tokenized payments using blockchain tech. But the Federal Reserve isn’t impressed.  Recent examinations by the Federal Reserve Bank of Philadelphia revealed major flaws in how Customers Bancorp manages risks, particularly in complying with anti-money laundering (AML) laws and the Bank Secrecy Act (BSA).  The Fed’s response? Make the bank’s life harder until it shapes up. Board oversight and risk management The Federal Reserve has ordered Customers Bancorp’s board of directors to step up their game and get a grip on the bank’s operations, especially when it comes to their crypto activities.  Within 60 days, the board has to come up with a plan to tighten oversight. This plan needs to spell out exactly how they’re going to maintain control over the bank’s major operations and make sure that management is sticking to the rules. The board must also make sure that the people in charge of the bank’s compliance with BSA/AML and OFAC regulations know what they’re doing and have the resources they need.  If the bank’s board doesn’t monitor adherence to policies and laws, including how the bank handles its crypto strategy, the Fed says they’re going to be in deep trouble. Risk management is another area where the Fed is turning the screws. Customers Bancorp has 60 days to submit a new risk management plan that’s up to the Fed’s…

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Filed under: News - @ August 11, 2024 5:24 pm