Cynthia Lummis Accuses FDIC of Destroying Operation Chokepoint 2.0 Records
Wyoming Senator Cynthia Lummis has issued a formal letter to Federal Deposit Insurance Corporation (FDIC) Chair Martin Gruenberg, expressing concerns following reports from whistleblowers within the agency.
According to the Republican legislator, her office was contacted by individuals alleging that the corporation was destroying documents tied to its digital asset activities.
The Alleged Activities
In her letter on Thursday, Lummis highlighted claims that suspected whistleblowers were being closely monitored by management as part of an effort to block communication with her office, with threats of legal action if staff members attempted to reach out.
She condemned the purported activities in a separate statement, saying:
The FDICs alleged efforts to destroy and conceal materials from the U.S. Senate related to Operation Chokepoint 2.0 is not only unacceptable, it is illegal.
The assertions revolve around Operation Chokepoint 2.0, an initiative ostensibly designed to hinder the crypto sectors access to traditional banking and financial services.
Concerns over the approach of regulators to crypto-related banking surfaced prominently last year. In August, multiple crypto industry figures met with White House officials to discuss their relationship, including Mark Cuban and Anthony Scaramucci, as well as representatives from Coinbase, Kraken, and Uniswap.
During the meeting, Deputy Treasury Secretary Wally Adeyemo denied any coordinated attempt to block crypto from the financial system. However, when a participant asked who had experienced restricted banking access due to White House policies, nearly all attendees reportedly raised their hands.
Coinbase also sued the FDIC in June 2024, accusing it of attempting to sever cryptos ties to traditional banking. However, the agency has denied targeting the industry. Its 2024 Risk Review report said that financial institutions are neither prohibited nor discouraged from providing banking services to customers of any specific class or type.
Senator Asks for Preservation of Crypto Records
In her message to Gruenberg, Lummis demanded that the regulator preserve all documents related to its digital asset activities since January 1, 2022. She detailed specific records to retain, including communications involving Signature Bank, Silvergate Bank, and crypto-related enforcement actions.
Additionally, she requested the preservation of guidance materials and records concerning the FDICs coordination with other federal agencies on digital assets.
The senators directive also called for safeguarding records containing terms such as crypto, Bitcoin, Ethereum, and digital asset, with an emphasis on protecting metadata and preventing the alteration or destruction of electronic information.
Further, the lawmaker warned that if anyone within the FDIC were found to have knowingly destroyed relevant materials or obstructed Senate oversight, swift criminal referrals would be made to the U.S. Department of Justice. Stressing the importance of transparency, Lummis pledged to ensure Americans receive the answers they deserve.
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