ICBA Sues OCC Over Crypto Trust Bank Charters

The Independent Community Bankers of America has sued the Office of the Comptroller of the Currency, asking a federal court to invalidate a rule and guidance it says unlawfully facilitate national trust bank charters for cryptocurrency firms. The lawsuit, filed in federal court in Washington, challenges an OCC final rule dated March 2 and related interpretive guidance. The ICBA argues that the agency exceeded the authority Congress granted under the National Bank Act by allowing trust-chartered institutions to conduct substantial nonfiduciary activities without the safeguards that apply to traditional banks. It asks the court to find the rule and guidance unlawful or require their revocation. The dispute centers on what activities national trust banks may undertake and what oversight should apply. The ICBA says firms using the charters can gain the credibility of a federal charter without requirements such as deposit insurance, capital and liquidity standards, and consolidated supervision. The group also argues that the difference in regulatory obligations could put community banks at a competitive disadvantage.