FDIC Investigates Voyager’s Claims About Customers’ Funds Covered by Deposit Insurance: Report

Shortly after filing for bankruptcy, embattled cryptocurrency brokerage firm Voyager Digital has reportedly come under scrutiny from the U.S. Federal Deposit Insurance Corporation (FDIC) for claiming that funds were FDIC-insured.

• According to the Wall Street Journal on Thursday (July 7, 2022), anonymous sources revealed that the FDIC is probing Voyager’s marketing. A statement on the company’s website in December 2019 said:

“Through our strategic relationships with our banking partner, Metropolitan Commercial Bank, all customers’ USD held with Voyager is FDIC insured. That means that in the rare event your USD funds are compromised, you are guaranteed a full reimbursement (up to $250,000), so the cash you hold with Voyager is protected.”

• However, customers of Voyager recently learned that their deposits were not FDIC-insured as marketed by the crypto firm.
• Also, a previous statement from Metropolitan Commercial Bank (MCB), a New York-chartered bank and FDIC member, stated that Voyager holds an omnibus account for only U.S. dollars and not crypto. The bank added that the insurance applies to the failure of MCB, not Voyager.

“FDIC insurance coverage is available only to protect against the failure of Metropolitan Commercial Bank. FDIC insurance does not protect against the failure of Voyager, any act or omission of Voyager or its employees, or the loss in value of cryptocurrency or other assets.”

• The latest development comes shortly after Voyager and its subsidiaries filed for Chapter 11 Bankruptcy. Earlier in July, the brokerage firm placed suspension on deposits, withdrawals, and trading.