News Release 2022-53 | May 17, 2022
WASHINGTON—Acting Comptroller of the Currency Michael J. Hsu issued the following statement at today’s Federal Deposit Insurance Corporation (FDIC) board meeting regarding the final rule on false advertising, misrepresentation of insured status and misuse of the FDIC’s name or logo.
I support the final rule implementing the FDIC’s statutory authority to prohibit any person or organization from making misrepresentations about FDIC deposit insurance or misusing the FDIC’s name or logo. The final rule describes the process by which the FDIC will identify, investigate, and evaluate potential violations of the statutory provision, and the procedures the FDIC will adhere to when formally or informally enforcing the provisions. The transparency provided by the final rule benefits all parties and promotes stability and confidence in FDIC deposit insurance and the nation’s financial system.
This final rule is timely given changes in the marketplace, technological developments, and rapidly evolving consumer behaviors. It is especially important in light of the growth of nonbank crypto firms and fintechs and their relationships with banks. The potential for consumer confusion about the status of cash held at these firms is high and this final rule will help provide clarity. It requires these firms, when highlighting the FDIC’s name or logo or representing that cash held at the firm is insured by the FDIC, to identify for consumers the insured depository institutions with which the firm has a business relationship and into which the consumer’s deposits may be placed. This information empowers consumers and allows them to make more informed decisions when interacting with nonbank crypto firms and fintechs.
Finally, I will note that the risk being addressed by this final rule reflects the strong confidence that the public and financial industry have in FDIC insurance. During times of uncertainty, the FDIC logo provides reassurance and an important sense of stability, as designed and intended. This is due to the tireless, behind the scenes hard work of the staff of this agency. I would like to recognize them for this. Thank you.