Community Bankers Sue OCC Over Crypto Firm Bank Charters
The Independent Community Bankers of America (ICBA), a U.S. industry group representing regional banks, filed a lawsuit on October 2 against the Office of the Comptroller of the Currency (OCC). The lawsuit challenges the OCC's decision to grant federal trust bank charters to crypto asset firms, arguing that the regulator has exceeded its authority.
ICBA, which primarily represents banks with assets under $10 billion, seeks to overturn a final rule published by the OCC in March and a 2021 interpretive letter. These measures facilitate the approval of federal trust charters for crypto asset firms, allowing them to perform trust-related services like asset management and custody. ICBA contends that these firms lack adequate safeguards and should not benefit from federal bank charters without meeting the same stringent requirements as traditional banks.
Rebeca Romero Rainey, ICBA's president and CEO, stated that consumers expect federal protections for federally chartered banks. She emphasized that digital assets held by crypto firms under these charters do not receive such protections and urged the court to rein in the OCC's overreach. The OCC declined to comment on the lawsuit.
The OCC, under the Trump administration, has previously approved multiple applications from crypto and fintech firms seeking federal trust charters, some with conditions. ICBA argues that granting these charters violates the OCC's statutory authority and Congress's intent, as traditional banks must adhere to stricter regulatory standards.