On December 21, 2022, the Federal Deposit Insurance Corporation published a notice of proposed rulemaking elaborating on what constitutes false advertising of deposit insurance for purposes of the Federal Deposit Insurance Act.
The Proposal would modernize rules on using the FDIC’s official sign and insured depository institutions’ advertising statements, as well as clarify regulations regarding misrepresentations of deposit insurance coverage. Should the Proposal be adopted, IDIs offering digital asset products (including stablecoins) and non-banks relying on pass-through deposit insurance arrangements with IDIs would face expanded disclosure obligations, even beyond those imposed last year.
Please click here to read the full alert memorandum.
(Republished May 2023 by The Banking Law Journal.)