Bank's Crypto Activities Review
From: XXXXX
Sent: Tuesday, August 13, 2024 8:28 AM
To: FDIC Kansas City Regional Office
Subject: RADD - XXXXX
Please put this in RADD as note to file for followup at the next compliance examination.
XXXXX
Review Examiner
Kansas City Region
Cell: XXXXX
From: XXXXX
Sent: Monday, August 12, 2024 4:16 PM
To: XXXXX
Cc: Gowlovech, Edward J. XXXXX@FDIC.gov; XXXXX
M: XXXXX
Subject: XXXXX - Consultation Has Been Closed
XXXXX
I agree that following up during the exam makes the most sense.
Would be able to send this email chain to RADD as a follow-up note to file to assist in recordkeeping for the review?
Thanks!
XXXXX
Field Supervisor, DCP
Federal Deposit Insurance Corporation
XXXXX
fdic.gov
FDIC
From: XXXXX
Sent: Thursday, August 8, 2024 7:17 AM
To: XXXXX
Cc: Gowlovech, Edward J. XXXXX@FDIC.gov
Subject: FW: XXXXX - Consultation Has Been Closed
WO finally closed out the XXXXX crypto consult but it includes the following statement: If the region has determined that the bank has sufficiently corrected the deficiencies in the DCP ROE related to the crypto-activity review, please notify the appropriate WO points of contact in DCP. If this determination has not yet been made, please contact the WO points of contact in DCP when such an assessment is in progress.
I suggest we add this as a follow up item to the upcoming exam – if no concerns are noted at the time, we can notify WO that the issues have been addressed. Everyone ok with that?
XXXXX
Review Examiner
Kansas City Region
Cell: XXXXX
From: XXXXX@FDIC.gov XXXXX@FDIC.gov On Behalf Of FOCUS
Sent: Wednesday, August 7, 2024 7:09 PM
To: XXXXX
Gowlovech, Edward J. XXXXX@FDIC.gov; Baker, Sherry L. XXXXX@FDIC.gov; Ball, Jennifer A. XXXXX@FDIC.gov; XXXXX; Thurman, Jessica L. XXXXX@FDIC.gov; Hollifield, Ardie XXXXX@FDIC.gov; Sagatelian, Marguerite XXXXX@FDIC.gov; Ziegler, Cheryl L. XXXXX@FDIC.gov; Popick, Stephen J. XXXXX@FDIC.gov; Cornell, Steven E. XXXXX@FDIC.gov; Johnston, Peter H. XXXXX@FDIC.gov; XXXXX; Salamone, Frank C. XXXXX@FDIC.gov; Troutt-Towns, Amy T. XXXXX@FDIC.gov
Cc: Finnegan, G. Chris XXXXX@FDIC.gov
Subject: FOCUS XXXXX Consultation Has Been Closed
CAUTION: External email. Do not click links or open attachments unless you recognize the sender and know the content is safe.
XXXXX Consultation Has Been Closed
This is to notify you that the following consultation has been closed. Please log in to FOCUS to view details for the consultation.
XXXXX
Exam Date: XXXXX
Consultation #: 8
Consultation Subject: General
Consultation Issue: New Product Review
Consultation Initiated: 6/22/2022
Consultation Closed: 8/7/2024
Consultation Action: No Concurrence Required
EIC: XXXXX
Field Office Assigned: XXXXX
Review Examiner: XXXXX
RO Lead: XXXXX
WO Lead: XXXXX
On May 10, 2022, XXXXX (the Bank) notified the FDIC of Bank's intent to offer crypto-asset products and services available in conjunction with the BaaS deposit accounts offered through an agreement with XXXXX. Subsequently, in XXXXX began offering all eligible users the ability to self-direct purchases and sales of crypto-assets (e.g. Bitcoin and Ethereum) using its mobile application, through an agreement with XXXXX.
XXXXX The notification was provided pursuant to Financial Institution Letter (FIL), FIL-16-2022, Notification of Engaging in Crypto-Related Activities. The FDIC requested additional information to assess the safety and soundness, consumer protection, and financial stability implications of such activities. The FDIC provided the bank with supervisory feedback in the DCP ROE for the examination dated September 14, 2022, which was mailed on April 10, 2023. The ROE included a Level 2 Medium Severity Violations of FDIC Part 328.102(a) for advertisements of deposit products provided by the bank alongside nondeposit crypto-asset products provided by XXXXX without a clear, conspicuous, and prominent disclaimer that the nondeposit product is not insured by the FDIC. The FDIC also provided additional supervisory feedback in the RMS ROE for the examination dated June 5, 2023, which was mailed on August 20, 2023. If the region has determined that the bank has sufficiently corrected the deficiencies in the DCP ROE related to the crypto-activity review, please notify the appropriate WO points of contact in DCP. If this determination has not yet been made, please contact the WO points of contact in DCP when such an assessment is in progress.
Note: This is an auto-generated email from FOCUS. Please do not reply to this email. Email XXXXX@FDIC.gov if you have any questions concerning this notice.