FTX-linked Farmington State Bank Cleared from Federal Reserve Enforcement Action

Alameda Research Federal Reserve FTX
Last updated:
Author
Brian Yue
Author Categories
About Author

Last updated:
Why Trust Cryptonews
Cryptonews has covered the cryptocurrency industry topics since 2017, aiming to provide informative insights to our readers. Our journalists and analysts have extensive experience in market analysis and blockchain technologies. We strive to maintain high editorial standards, focusing on factual accuracy and balanced reporting across all areas - from cryptocurrencies and blockchain projects to industry events, products, and technological developments. Our ongoing presence in the industry reflects our commitment to delivering relevant information in the evolving world of digital assets. Read more about Cryptonews

The Federal Reserve terminated an enforcement action with Farmington State Bank on February 6, announcing that the FTX-affiliated bank had “completed its wind-down plan and no longer functions as a bank.”

“The Board’s enforcement action, which has been in effect since July 2023, ensured the bank’s operations would wind down in a manner that protected the bank’s depositors,” the central bank said in its statement.

Farmington State Bank’s Enforcement Action

The Fed previously asserted in August 2023 that Farmington State Bank and its holding company, FBH Corporation, modified their business plan without notifying regulatory supervisors.

The central bank also announced the termination of two enforcement actions with BNP Paribas in Paris, France.

“Both enforcement actions have been in effect since June 2014 and required BNP Paribas to implement a program to ensure global compliance with U.S. sanctions laws,” the central bank said regarding BNP Paribas.

Farmington had direct connections to defunct crypto exchange FTX’s trading arm, Alameda Research, although neither the Fed enforcement action nor the termination of its action explicitly mentioned FTX or Alameda.

Farmington, formerly known as Moonstone Bank, received around $11.5 million from FTX’s sister firm, Alameda Research, through FBH Corporation in March 2022.

Following the collapse of FTX in November 2022, Farmington initially announced plans to withdraw from crypto and revert to its “original mission” as a community bank. When faced with the central bank’s enforcement action last year, however, Farmington agreed to comply with the order.

“All bank regulatory approvals for the assumption of deposits and the purchase of assets by Bank of Eastern Oregon of Farmington State Bank have been received,” Farmington stated in August.

Farmington Bank Faces Scrutiny

Senator Elizabeth Warren, D-Mass., and Tina Smith, D-Minn., conducted an inquiry into the bank’s connections with FTX and wrote to the Fed in 2022, seeking information on how Alameda was reportedly able to acquire Moonstone Bank.

In their letters, they expressed concerns, stating, “While the banking system has, so far, been relatively unscathed by the latest crypto crash, FTX’s collapse shows that crypto may be more integrated into the banking system than regulators are aware.”

More Articles

Blockchain News
SEC Acknowledges Spot Solana ETF Filings from Canary, VanEck, Bitwise, and 21Shares
Hassan Shittu
Hassan Shittu
2025-02-12 00:29:24
Blockchain News
Crypto Custodian BitGo Eyes IPO in H2 as Regulatory Support Strengthens: Report
Tanzeel Akhtar
Tanzeel Akhtar
2025-02-11 23:30:45
Crypto News in numbers
editors
Authors List + 66 More
2M+
Active Monthly Users Around the World
250+
Guides and Reviews Articles
8
Years on the Market
70
International Team Authors