Community banks group sues OCC over crypto trust bank charters

The Independent Community Bankers of America (ICBA) sued the Office of the Comptroller of the Currency (OCC) over its decision to allow cryptocurrency companies to obtain limited national trust bank charters. The ICBA alleges that the decision exceeds the authority Congress granted the agency. The group filed the lawsuit Friday in the US District Court for the District of Columbia. The ICBA claimed that the OCC has given cryptocurrency firms the credibility of a US bank charter without sufficient safeguards or compliance with normal bank requirements.

ICBA president and CEO Rebeca Romero Rainey said allowing national trust bank charters for substantial non-fiduciary activities exceeds the OCC's congressional authority. Rainey said Congress did not create the national trust charter to let crypto firms enter the banking system without requirements applicable to insured depository institutions. Rainey identified those requirements as Community Reinvestment Act obligations, consolidated supervision, capital and liquidity standards, and Federal Deposit Insurance Corporation insurance. Rainey said the ICBA is asking the court to return the OCC to its statutory limits.

The OCC had not responded to a request for comment on the lawsuit by publication. Reporting in August found that, under President Donald Trump and OCC head Jonathan Gould, the agency had approved or conditionally approved multiple crypto companies' trust charter applications. The companies sought the charters to expand their services in the US. However, trust bank charters do not allow companies to accept deposits or make loans, distinguishing these companies from conventional commercial banks.