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08/12/2024
Fed Enforcements Now Focus on Instant Payments and Tokens
PYMNTS
A recent enforcement action by the Federal Reserve taken against Customers Bancorp and its Customers Bank subsidiary has taken note of the risks and challenges inherent in handling digital assets — and faster payments, too.
In the action, announced on Thursday (Aug. 8) and signed by the parties this week, the central bank ordered that the bank must submit plans to retool and improve its risk management practices, with an eye on anti-money laundering (AML) and digital asset concentration — along with addressing compliance deficiencies tied to its instant payment operations.
A Digital Strategy
In terms of the bank’s business model, Customers Bancorp has pursued a business strategy “that involves offering banking services to digital asset customers … and also operates an instant payments platform that allows commercial clients to make tokenized payments over a distributed ledger technology system to other commercial clients of the Bank."
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