The Federal Reserve Board of the United States and the Washington State Department of Financial Institutions have announced an enforcement action against Farmington State Bank, a financial institution whose parent company received more than $11 million from Alameda Research.
In an Aug. 17 announcement, the Fed said the enforcement action was related to Farmington “improperly chang[ing] its business plan” in 2022 without proper notification and approval. The bank did not inform the Fed it intended “to pursue a strategy focused on digital banking services or digital assets.” Formerly named Moonstone, Farmington received roughly $11.5 million from FTX’s sister firm Alameda through its holding company FBH Corporation in March 2022.
“The Board’s action ensures the bank’s operations will wind down in a manner that protects the bank’s depositors and the Deposit Insurance Fund,” said the Fed. “The action also prohibits Farmington and FBH from making dividends or capital distributions, dissipating cash assets, and engaging in certain activities without approval from its supervisors.”
Farmington announced in January that it planned to exit the crypto space in an effort to return to its “original mission” as a community bank. However, the Fed enforcement action suggests the bank had “engage[d] in activities related to digital assets,” including facilitating the issuance of stablecoins for an unnamed third party “in exchange for receipt of 50 percent of mint and burn fees.”
The Fed reported Farmington, based in Washington, had planned to sell its loans and deposits to the Bank of Eastern Oregon. Neither the Fed enforcement action nor the move to leave the space explicitly mentioned crypto exchange FTX, which declared bankruptcy in November 2022.
The enforcement action represented the latest by federal regulators against banks with ties to crypto firms and investors in the wake of the FTX collapse. Silvergate Bank’s parent company announced in March it planned to “wind down operations” for the crypto bank. This action preceded Silicon Valley Bank collapsing amid a run on deposits and the Federal Deposit Insurance Corporation shutting down the crypto-friendly Signature Bank.
U.S. lawmakers conducted several hearings in the wake of the bank failures, with some suggesting that ties to crypto firms had contributed to the banks’ collapse. New York Department of Financial Services superintendent Adrienne Harris reportedly said it was “ludicrous” to blame digital assets for the collapse of Signature.
Canterbury MP Rosie Duffield has resigned from the Labour Party.
The 53-year-old MP is the first to jump ship since the general election and in her resignation letter criticised the prime minister for accepting thousands of pounds worth of gifts.
She told Sir Keir Starmer the reason for leaving now is “the programme of policies you seem determined to stick to”, despite their unpopularity with the electorate and MPs.
In her letter she accused the prime minister and his top team of “sleaze, nepotism and apparent avarice” which are “off the scale”.
“I’m so ashamed of what you and your inner circle have done to tarnish and humiliate our once proud party,” she said.
Since December 2019, the prime minister received £107,145 in gifts, benefits, and hospitality – a specific category in parliament’s register of MPs’ interests.
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Ms Duffield, who has previously clashed with the prime minister on gender issues, attacked the government for pursuing “cruel and unnecessary” policies as she resigned the Labour whip.
She criticised the decision to keep the two-child benefit cap and means-test the winter fuel payment, and accused the prime minister of “hypocrisy” over his acceptance of free gifts from donors.
“Since the change of government in July, the revelations of hypocrisy have been staggering and increasingly outrageous,” she said.
“I cannot put into words how angry I and my colleagues are at your total lack of understanding about how you have made us all appear.”
Ms Duffield also mentioned the recent “treatment of Diane Abbott”, who said she thought she had been barred from standing by Labour ahead of the general election, before Sir Keir said she would be allowed to defend her Hackney North and Stoke Newington seat for the party.
Her relationship with the Labour leadership has long been strained and her decision to quit the party comes after seven other Labour MPs were suspended for rebelling by voting for a motion calling for the two-child benefit cap to be abolished.
“Someone with far-above-average wealth choosing to keep the Conservatives’ two-child limit to benefit payments which entrenches children in poverty, while inexplicably accepting expensive personal gifts of designer suits and glasses costing more than most of those people can grasp – this is entirely undeserving of holding the title of Labour prime minister,” she said.
Ms Duffield said she will continue to represent her constituents as an independent MP, “guided by my core Labour values”.