New York, Tuesday, September 10, 2024 – United Texas Bank, a Dallas-based institution with ties to the cryptocurrency industry, has been hit with a cease and desist order from the U.S. Federal Reserve due to concerns over its risk management and compliance programs.
The Federal Reserve’s order, issued on September 4, 2024, cites “significant deficiencies” in the bank’s dealings with crypto-related entities and its foreign correspondent banking operations.
The order highlights issues with United Texas Bank’s adherence to anti-money laundering (AML) regulations and the Bank Secrecy Act (BSA).
While the Federal Reserve did not disclose specific failures, it called for immediate improvements to the bank’s compliance program, which had been reviewed during an examination in May 2023.
United Texas Bank has been given 90 days to submit a comprehensive plan to improve its oversight of AML and BSA compliance. Additionally, the bank must revise its customer due diligence program and submit it for review within 60 days.
This enforcement action signals increased regulatory pressure on crypto-friendly banks in the U.S., especially those with foreign crypto clients.
United Texas Bank said it is now working to bolster its compliance mechanisms in response to the order, joining other financial institutions facing similar scrutiny.
The tightening oversight comes as U.S. regulatory bodies increase their focus on the crypto sector ahead of the 2024 presidential elections, with both major candidates discussing the future of crypto regulations.
