The U.S. regulators Federal Reserve and Federal Deposit Insurance Corporation (FDIC) issues a joint letter against Voyager Digital demanding a “cease and desist” from making claims that its customers’ funds were protected by the government.
According to the letter, Voyager made a number of statements suggesting that the company was FDIC-insured and that customers’ funds invested in its platform have insurance coverage.
The company also stated that the FDIC would insure its customers against the failure of Voyager itself, and the regulator called these representations “false and misleading”.
Just three weeks back, the FDIC started examining Voyager Digital over false insurance claims. Deposits in Metropolitan Commercial Bank were advertised by Voyager as being FDIC-insured, when in fact only MCB is insured, not the Voyager ones.
The regulators are now demanding Voyager to remove all “statements, representations, or references” suggesting that Voyager is FDIC-insured and related claims from Voyager’s websites, social media accounts, mobile app, online outlets, and “all forms of marketing, advertising, or consumer-facing materials and communications.”
Voyager is required to give written confirmation to the FDIC and Board of Governors that it has fully complied with the above requests within two business days of receiving this letter.
The letter also demanded Voyager to provide a full listing of all statements regarding any reference to FDIC insurance within 10 days.
Almost three weeks back Voyager Digital filed for Chapter 11 bankruptcy. A few days back crypto exchange FTX came to its rescue saying it would provide early liquidity to the clients but Voyager called the proposal a “low-ball bid dressed up as a white knight rescue” benefitting FTX itself.
