FDIC alleges Cross River engaged in ‘unsafe’ lending practices

The Federal Deposit Insurance Corporation (FDIC) has asked for Cross River Bank– known for its services to fintech and crypto companies like Visa and Coinbase– to “self-correct” and properly address weaknesses in its loaning activities.On April 28, the FDIC made public an approval order carried out with Cross River Bank on March 8, alleging that the bank engaged in “unsafe” or “unsound” banking practices in regard to its compliance with applicable reasonable loaning laws and policies in 2021. The order states that the bank needs to immediately take action to increase its supervision over the “system of internal controls, details systems, credit underwriting practises, and internal audit systems related to the customer defense laws and guidelines.” Furthermore, the bank is required to quickly “self-correct” any infractions of reasonable financing laws.Cross River was bought to “appropriately address” the weak points and shortages recognized in the 2021 report of evaluation, as well as create procedures to ensure these weak points do not appear in future.The FDIC performed the approval order with Cross River Bank on March 8.