The Office of the Comptroller of the Currency (OCC) is taking action against a former bank employee for allegedly stealing thousands of dollars in just one week. The OCC says it’s issuing an order of prohibition against Sabrina Prince for violations of law that resulted in unjust enrichment at the expense of PNC Bank. Between May […]
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A former Wells Fargo senior manager just agreed to pay a $40,000 fine and turn his back on the banking industry. The Office of the Comptroller of the Currency (OCC) is issuing a consent order against ex-Wells Fargo operations senior manager Norman Desembrana for allegedly misleading customers, engaging in reckless unsafe and unsound practices and […]
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The Federal Reserve and the Office of the Comptroller of the Currency (OCC) are hitting banking giant JPMorgan Chase with a $348.20 million fine in a coordinated enforcement action. Both the Fed and the OCC say JPMorgan engaged in “unsafe or unsound banking practices” in relation to its trade surveilling program. The OCC says that […]
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Acting Comptroller of the Currency Michael J. Hsu just issued a fresh warning about potential risks to the US banking system. In a new statement from the Office of the Comptroller of the Currency (OCC), Hsu says that banks should be “on the balls of their feet” with regards to risk management as credit markets […]
The post US Banks Facing ‘False Sense of Comfort’ Amid Rising Signs of Credit Stress, Says Banking Regulator appeared first on The Daily Hodl.
On Feb. 9, 2023, the cryptocurrency community learned of the U.S. Securities and Exchange Commission’s (SEC) crackdown on staking services. The SEC fined Kraken, a cryptocurrency exchange, $30 million for offering an “unregistered offering” related to its U.S. staking service. Digital currency advocates are now debating what constitutes a yield product versus a noncustodial solution […]
While the exact reason for the investigation hasn’t been revealed, it has been reported that the New York regulator plans on upping its efforts to protect consumers this year.
Paxos Trust Company — the New York-based stablecoin issuer behind Binance USD (BUSD) and Paxos Dollar (USDP) — is reportedly being investigated by the New York Department of Financial Services (NYDFS).
A “person familiar with the matter” told Bloomberg in a Feb. 10 report that the exact motive behind the probe is currently unclear.
An NYDFS spokesperson declined to comment on ongoing investigations but noted that the department is broadly working to protect consumers from risks associated with investing in the cryptocurrency market:
“The department is in continuous contact with regulated entities to understand vulnerabilities and risks to consumers and the institutions themselves from crypto market volatility we are experiencing.”
Paxos has issued BUSD — a U.S. Dollar-collateralized stablecoin — since the firm struck a partnership with Binance in September 2019. It is the third largest stablecoin, with a market cap currently exceeding $16 billion.
It is also the creator of the Paxos Dollar (USDP) which was launched in 2018. Today it is the sixth largest stablecoin with a market cap of about $875 billion, according to CoinGecko, and is the founder of PAX Gold (PAXG), a gold-backed-Ethereum token.
The company is also behind digital asset exchange itBit, which it launched in 2012 alongside the founding of Paxos.
The NYDFS issued Paxos with “BitLicense” in 2015, which legally permits companies to conduct digital currency-related activities in the state of New York.
Paxos recently refuted rumors that the U.S. Office of the Comptroller of the Currency (OCC) may order Paxos to withdraw its application for its full banking charter, despite the firm only receiving a preliminary approval in April, 2021.
To clarify speculation: Paxos has not been asked to withdraw its application for a national trust bank charter from the OCC, nor has it been denied the charter. Paxos continues to work constructively with the OCC.
— Paxos (@PaxosGlobal) February 8, 2023
Paxos also claims on its website that its BUSD and USDP token reserves are backed wholly in U.S. Dollars and U.S.Treasuries.
Related: New York State issues guidance for banks seeking to engage in activities with crypto
If reports of the investigation are true, it wouldn’t be the first one initiated by the NYDFS over the last year.
Coinbase Global U.S. reached a $100 million settlement with the New York regulator on Jan. 4 after they found that they failed to look over about 100,000 suspicious transactions from customers who opened accounts without sufficient background checks.
Shortly after Terra LUNA ecosystem and its failed algorithmic stablecoin TerraClassicUSD (USTC) collapsed in May, 2022, the NYDFS published stablecoin guidance report to ensure stablecoin issuers fully back their assets and attest regularly.
Cointelegraph reached out to Paxos and Binance to comment on the matter but did not receive an immediate response.
The U.S. Office of the Comptroller of the Currency (OCC) is issuing a joint statement with the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) urging US banks to be more cautious of risks related to crypto. The statement comes two months following the collapse of the crypto exchange FTX, which left many investors […]
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The head of the Office of the Comptroller of the Currency (OCC) is reiterating the risks of investing in crypto assets following the Terra (LUNA) collapse. In a new interview on Yahoo Finance Live, OCC Acting Comptroller of the Currency Michael Hsu says Terra’s crash unveiled the fragilities of the crypto space. “I think the […]
The post US Banking Regulator Issues Crypto Warning, Says Terra (LUNA) Collapse Exposed Three Industry ‘Fragilities’ appeared first on The Daily Hodl.
Omarova has stated she hopes to “end banking as we know it” but believes large financial firms can abuse the crypto market outside of regulators’ view.
The Biden administration reportedly intends to nominate Kazakhstani-American attorney, academic and former policy advisor Saule Omarova to head the Office of the Comptroller of the Currency (OCC) — the institution that oversees the U.S. banking sector.
Omarova has levied criticisms at both crypto assets and the legacy banking sector in the past, having once pledged to “end banking as we know it”. She has characterized cryptocurrency as “benefiting mainly the dysfunctional financial system we already have.”
According to a Sept. 22 report from Bloomberg citing three anonymous sources “familiar with the nomination process,” Omarova could be nominated as soon as this week.
Currently working as a law professor at Cornell University Law School, Omarova is expected to seek tighter regulations for crypto as she has described the sector as threatening the stability of the economy and ripe for abuse from large private financial entities. The academic specializes in banking law and corporate finance.
If confirmed, Omarova’s tenure at the OCC would likely comprise a significant shift from the previous administration, with former Coinbase legal officer and crypto proponent Brian Brooks having headed the agency toward the end of Trump’s presidency.
Omarova has also offered radical prescriptions for the finance industry, having advocated for consumer banking services to exclusively be administered by the Federal Reserve rather than private institutions. She previously served as a special adviser for regulatory policy to the U.S. Treasury Department during George W. Bush’s presidency.
However, analysts don’t believe Omarova will get the OCC jobwithout a fight, with the Democrats currently holding a slim majority in the Senate and the banking sector expected to lobby against her appointment.
If appointed, Omarova would become the first woman to formally lead the agency, although the OCC has been directed by a female acting head in the past.
Related: CFTC commissioner: Agency doesn’t have enforcement resources without Congress
The New York Times reported that the Biden administration had started vetting Omarova for the role in early August.
While the Democrats were previously considering former Treasury official Michael Barr and law professor Mehra Baradaran for the role, they were dropped after the Democrats decided neither candidate was likely to garner enough support to secure confirmation.
The digital currency and stablecoin issuer Paxos has been granted conditional approval for a bank charter under the Paxos National Trust in New York. The U.S. Office of the Comptroller of the Currency issued a preliminary conditional approval which means the regulating entity still has to authorize the firm’s future banking plans. Paxos Granted Preliminary […]