Financial Institutions

This August, the Federal Deposit Insurance Corporation issued letters to five different cryptocurrency companies demanding that they cease and desist from making false and misleading statements about FDIC insurance. In this video, Jeffrey Alberts, co-chair of Pryor Cashman’s Financial Institutions Group, discusses the nature of FDIC insurance, the FDIC’s concern with how crypto companies are referencing FDIC insurance and how to avoid violating the Federal Deposit Insurance Act’s prohibitions on misleading statements about FDIC insurance.

Last week, the DOJ settled a groundbreaking case against Meta Platforms (formerly Facebook) based on allegations of what it described as “algorithmic discrimination” under the Fair Housing Act. The Consumer Financial Protection Bureau (CFPB) has made clear that it also intends to target algorithmic discrimination and the use of artificial intelligence by financial institutions. In this video, Jeffrey Alberts, co-chair of Pryor Cashman’s Financial Institutions Group, discusses how financial institutions are relying on artificial intelligence, the difficulties that this can create with the CFPB, and what financial institutions and FinTechs should do now to ensure that their use of algorithms complies with consumer protection law.

The U.S. government has recently announced a variety of sanctions against certain Russian oligarchs, Russian entities and regions of Ukraine. There's a number of ways in which this can impact cryptocurrency and blockchain companies, even those that are not doing business in the United States. In this video, Jeffrey Alberts explains the recent sanctions programs, how they apply to crypto companies, and what crypto companies should do now to ensure that they don't violate the sanctions that the U.S. government has recently imposed. 

On March 16, FinCEN announced the creation of the Kleptocracy Asset Recovery Program, which is aimed at offering rewards to people who provide information to the U.S. government about various stolen assets that are linked to the Russian government. It can implicate people who work at financial institutions, as well as a number of other types of companies that are involved in high value transactions, such as transactions involving real estate, artwork, luxury goods, or crypto assets. In this video, Jeffrey Alberts, co-chair of Pryor Cashman's FinTech Group and chair of the White Collar Defense and Investigation Practice, discusses the development of the program and its potential implications.

The use of decentralized exchanges (“DEXs”) to execute cryptocurrency trades has exploded this year. Earlier this month, however, the Wall Street Journal reported that the main developer of one of the world’s largest DEXs is being investigated by the U.S. Securities and Exchange Commission. This has caused a great deal of concern over whether regulators are going to seek to regulate or even shut down DEXs.

In this video, Jeffrey Alberts, co-chair of Pryor Cashman's Financial Institutions Group, discusses the regulatory status of DEXs, and what DEX developers and users can do to minimize their regulatory risk.

Regulators have been ramping up enforcement actions based on cybersecurity program deficiencies.  In this video, Jeffrey Alberts, co-chair of Pryor Cashman's Financial Institutions Group, discusses the types of enforcement actions we have seen so far this year and what regulated businesses can do now to reduce the risk of facing a cybersecurity enforcement action.

Marijuana possession and recreational use were legalized in New York, the banking capital of the United States.  This has banks and other financial services companies asking whether it is now legal to provide financial services to marijuana-related businesses.  Is it really possible that you can smoke it, but you can’t bank it?  In this video, Jeffrey Alberts, co-chair of Pryor Cashman's Financial Institutions Group, discusses the current state of the cannabis banking law, changes to expect in the coming year, and what financial services companies can do now to prepare for these legal developments.

This week, FinCEN published an advance notice of proposed rulemaking for a rule implementing the beneficial ownership reporting provisions of the Corporate Transparency Act.  In this video, Jeffrey Alberts, co-chair of Pryor Cashman's Financial Institutions Group, discusses the proposed rule and shares a few thoughts on what financial institutions should do now to prepare.

The National Defense Authorization Act for Fiscal Year 2021 (“NDAA”)  dramatically expanded the government’s power to use Patriot Act subpoenas to obtain records from banks.  Foreign banks and U.S. banks that provide correspondent accounts to foreign banks should prepare now for the increased use of these subpoenas. In the video, Jeffrey Alberts, co-chair of Pryor Cashman's Financial Institutions Group, discusses the NDAA and shares a few thoughts on what banks should do now to prepare.

On October 1, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued an advisory clarifying that banks and payments companies could be fined for facilitating ransomware payments to sanctioned entities. The same day, the Financial Crimes Enforcement Network (FinCEN) issued a related advisory concerning the threats posed by ransomware payments and the obligation of money services businesses to file suspicious activity reports (SARs) concerning suspicious ransomware payments.

On September 21, the OCC clarified in an interpretive letter that federally chartered banks and thrifts may take reserves on behalf of customers who issue cryptocurrency stablecoins. As Jeff Alberts, co-head of the FinTech Group, discusses in this video, taking stablecoin reserve deposits represents a potentially lucrative opportunity for federally chartered banks. To learn more about the benefits and challenges of accepting stablecoin reserve deposits, check out the video below.

Our Partner Jeffrey Alberts shares his thoughts on Bank Hapoalim agreeing to pay over $900 million in fines and admitting last week to participating in two different major criminal conspiracies involving bribing FIFA officials and tax evasion.

OFAC’s statement about when banks can reallocate sanctions compliance resources has confused compliance professionals. As Jeffrey Alberts discusses in this video, the announcement’s legal effect is minimal, but it still provides practical guidance to banks.

Partner Jeffrey Alberts shares his thoughts on the $86 million in penalties imposed on the Industrial Bank of Korea by the Manhattan U.S. Attorney's Office and the New York Department of Financial Services.

A new version of the BSA/AML Manual was released this week. Here are a few thoughts on how the new manual may be helpful for banks and FinTechs.

Partner Jeffrey Alberts provides an overview of the intra-agency appeals process.