On December 17, CFPB Director Rohit Chopra, as a member of the FDIC Board of Directors, released a discussion draft outlining the FDIC’s policy on terminating deposit insurance for banks involved in money laundering. The draft highlighted the FDIC’s commitment to enforcing the Annunzio-Wylie Anti-Money Laundering Act of 1992, which mandates deposit insurance termination for banks convicted of certain criminal offenses. However, the FDIC has noted cases where banks were convicted of related crimes, such as conspiracy, rather than the specific offenses listed in the Act, and thus were not subject to deposit insurance termination. In such cases, the FDIC would use its discretionary authority to terminate deposit insurance under other legal provisions if the crimes meet the criteria for unsafe and unsound practices. According to the discussion draft, this approach aimed to uphold the spirit of the Annunzio-Wylie Act by addressing cases where banks or their holding companies are criminally convicted of money laundering-related activities, even if not directly charged under the Act’s enumerated offenses.

Chopra stated that the FDIC’s discussion draft policy sought to rectify these loopholes by initiating proceedings against any insured depository institution convicted of money laundering-related charges, even if not explicitly listed in the Annunzio-Wylie Act. He clarified while these proceedings might not always result in termination, they could lead to other limitations, such as preventing banks from offering new insured accounts.