Senator Asks FDIC Over Allegations It Discourages Banking Relationships With Crypto Firms

Sen. Pat Toomey says he has whistleblower information that the FDIC, without a legal basis, discourages banks from dealing with companies with crypto ties.

Pat Toomey, a senior member of the United States Senate Banking Committee, sent a letter to Federal Deposit Insurance Corporation (FDIC) Director and Acting Chairman Martin Gruenberg informing him of the allegations of a whistleblower regarding FDIC activities. The senator suspects the FDIC “of taking improper steps to deter banks from doing business with legal cryptocurrency (crypto-related) companies.”

Toomey wrote that there is corroboration of whistleblowers' claims that "FDIC headquarters staff in Washington, D.C. are urging FDIC regional offices to send letters to several banks asking them to refrain from expanding their relationships with crypto-related companies, without providing any basic legal information for sending such letters."

Furthermore, Toomey wrote that there were reports that FDIC headquarters staff took the highly atypical step of contacting staff at a regional office to urge them to downgrade FDIC status. a loan to a crypto-related company, adding:

"FDIC regional office staff reportedly interpreted the FDIC headquarters' involvement in this matter as an effort to change the way crypto-related business loans are generally classified and to deter banks from 'provide such loans in the future.'

Judging from the letter, the alleged FDIC letters were sent on or around June 6th. Toomey asks Gruenberg to confirm or deny the alleged activities by the end of the month and asks if the FDIC legal division has provided an opinion on the alleged activities.

Related: Deposits with non-bank entities, including crypto companies, are not insured – FDIC

Toomey is a hawkish crypto advocate. He