Voyager accused of lying about deposit insurance

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A struggling cryptocurrency firm should retract all claims that she and her clients are FDIC insured.

US regulators take over

US Federal Reserve System (FRS) banking regulators e Federal Deposit Insurance Corporation (FDIC) Thursday issued an order to shut down the operations of cryptocurrency firm Voyager Digital. Agencies blame Voyager for this “false and misleading” claims.‘, informing customers that theirs The funds were provided by the government.

Federal Deposit Insurance Corporation (FDIC) is an independent agency created by Congress Maintain the stability and trust of the public in the national financial system. What FDIC insures the depositscontrols and monitors financial institutions for safety, security and consumer protection, makes large and complex financial institutions solvable, and manages bankruptcy proceedings.

In partnership with @FederalReserve, we have sent a letter to #VoyagerDigital urging them to stop making false and misleading claims about their FDIC deposit insurance status and take immediate action to correct these false claims. https://t.co/sWv1n7z710

– FDIC (@FDICgov) July 28, 2022

On July 8, the FDIC announced an investigation into Voyager’s claims. which was insured by the FDIC thanks to him Partnership with Metropolitan Commercial Bank.

“MCB is a depository institution whose deposits are insured by the FDIC. The Board of Governors is the primary federal regulator of the MCB, “the regulators said. In short, the fact that MCB is insured by the FDIC it doesn’t mean that Business trips are also insured. from the FCSD.

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Voyager filed for bankruptcy on July 5 after it was revealed that the company had $ 661 million in the 3AC cryptocurrency hedge fund, which also went bankrupt.

Did the traveler lie?

She has now been accused of what she claimed on her website, app and social media: be insured with the FDIC. This is required by the supervisory authority. Voyager removes any claims immediatelyview or link offer FDIC insurance for Voyager that customers will have FDIC coverage or that FDIC will insure customers against Voyager bankruptcy.

Voyager appears to have already taken steps to comply. In the original December 2019 blog post titled “US dollars held in Voyager are now insured by FDIC,” Voyager said that FDIC insurance covers both Voyager and its banking partner in the event of bankruptcy. its general customers are guaranteed a full refund of up to $ 250,000..

In the July 2022 update, “Are US dollars in my FDIC account insured?” The website now states that the US dollars in the customer’s Voyager Cash account are held in MCB and are FDIC insured.

This means that in the event of MCB’s default, you cover up to a maximum of $ 250,000 per Voyager customer. FDIC insurance does not protect Voyager from bankruptcy, but to be clear, Voyager does not hold customer money, which is held in the MCB.

Voyager also updated the original blog post, so the order will require it. Voyager will provide written confirmation what the company did Order within two business days after receiving the letter. “This confirmation is intended to detail Voyager’s efforts to comply with this letter, including all steps taken by Voyager to identify and detect all of these distortions,” reads the order.

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The journey continues raise concerns and this time it appears to have been overtaken by US regulators well named. After going bankrupt, largely due to a loan from Three Arrows Capital, Voyager has unveiled in recent days. restructuring plan.

He mentioned this on July 11th. The funds will be returned to the usersWith:

Client funds belong to you and will be returned to you after verification and fraud prevention. All client funds are held in a client account with the Metropolitan Commercial Bank and contain the same amount as the funds in Voyager accounts.

We are closely monitoring consequences of this case it’s making headlines in the crypto media and it doesn’t look like it’s going to stop anytime soon. FROM Failures of Three Arrows Capital and Celsiusthis case is partial responsible for the accident what the cryptocurrency market has experienced in recent weeks.

For more information on Voyager’s restructuring plan, read our article here.

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