Federal Reserve Takes Action Against FTX-Linked US Bank By Cointelegraph

The U.S. Federal Reserve and the Washington State Department of Financial Institutions announced an enforcement action against Farmington State Bank, a financial institution whose parent company received more than $11 million from Alameda Research.

In the Aug. 17 announcement, the Fed said just that The move was related to Farmington “improperly changing its business plan” in 2022 without proper notice and approval. It did not inform the Fed of its intention to “pursue a strategy focused on digital banking or digital assets.” Farmington, formerly known as Moonstone, received about $11.5 million from FTX’s sister company, Alameda, through its holding company, FBH Corporation, in March 2022.

• FTX is seeking a $175 million settlement with Genesis Entities to settle the lawsuit

“The Board’s action ensures that the operations of the Bank will be settled in a manner that protects depositors of the Bank and the Deposit Insurance Fund,” Fed said. “The action also prohibits Farmington and FBH from making dividends or capital distributions, squandering cash assets, and engaging in certain activities without the approval of their supervisors.”

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