WASHINGTON, D.C. – Dennis M. Kelleher, Cofounder, President and CEO, issued the following statement in connection with Federal Reserve Board’s (Fed) enforcement action issued today against Customers Bancorp, Inc. and Customers Bank in Pennsylvania:
“The Fed’s enforcement action today against Customers Bank details 13 pages of significant deficiencies in the bank’s most basic risk management practices and compliance with the applicable laws, rules, and regulations relating to anti-money laundering (‘AML’) and the Bank Secrecy Act (‘BSA’). While the Fed’s action today is welcome, it is too little and too late. These are incredibly serious failures and the fact that the Fed is just now taking action is inexplicable. Adding insult to injury, today’s enforcement action provides another 60 days for the bank’s board of directors to submit a plan to strengthen the bank’s management and operations, allowing for even more time for deficient and risky activities to continue endangering the bank, its customers, and the banking system as a whole. And this is just the submission of the plan, not the plan of action to strengthen the bank.
“The crypto industry is baselessly claiming that the Fed is targeting crypto-friendly banks and claims this enforcement action is part of some orchestrated, well-timed conspiracy. Those claims are laughable. This is about the most basic systems and controls that all banks are required to have to ensure compliance with the laws, including the laws to prevent money laundering. The crypto industry’s complaints highlight yet again the degree to which its reputation as a lawless industry is so well-deserved. A responsible, legitimate business wouldn’t have broken the laws in the first place and would have promptly fixed them when discovered.
“This action also shows the wisdom of the banking agencies decision to investigate the risks that lurk in third-party arrangements. Those agencies need to do that with far more urgency than shown in this enforcement action. Nothing less is required to protect the financial system and Main Street Americans before it is too late.”
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Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.org.
