Current Events > The FDIC is being gutted

(+) Yeah! (+)

https://www.axios.com/2025/03/24/fdic-doge-banks-regulator
Roughly 10% of FDIC staff have already been cut, including over 450 employees who accepted buyouts and at least 160 terminated probationary staff. The cuts came swiftly, framed as part of a broader efficiency initiative.

17% of remaining employees are eligible for retirement in 2025a potential cumulative loss of one-third of the workforce within a year.

https://news.bloomberglaw.com/banking-law/fdic-employees-take-trump-buyout-offer-ahead-of-restructuring
An additional 8% are on deferred resignation tracks, meaning theyre expected to exit later this year.

https://www.bankingdive.com/news/fdic-attrition-brain-drain-bank-failures-exams-oig-report/743220/
The FDIC's own Inspector General has issued warnings that these reductions put the agency at risk of failing to complete its legally mandated bank examinations by year-end, even as risks across the financial system continue to mount.

These are not cost-neutral reductions. Bank examiners take years to fully train. The system doesnt simply bounce back when staffing resumes, it hollows out and stays hollowed, often until a crisis forces a reaction.

When deposit protections are quietly dismantled while the agency responsible is systematically downsized, the end result is not just deregulation, it is engineered fragility.

The dismantling is becoming clear in new policy.

https://www.ndba.com/news/FDICWithdrawsProposedRulesonBrokeredDepositsCorporateGovernance/
The FDIC has rescinded key regulatory proposals, including stricter brokered deposit rules and executive compensation limitsrules specifically designed to reduce reckless risk-taking in banks.

https://www.steptoe.com/en/news-publications/fdic-board-of-directors-rolls-back-several-biden-era-rulemaking-actions.html
Merger review guardrails have been rolled back, reopening the door to rapid consolidation and reducing barriers to "too big to fail" entrenchment.

https://www.consumerfinanceandfintechblog.com/2025/03/occ-eliminates-reputational-risk-category-from-bank-supervision-criteria/
Examiners have been formally instructed to eliminate "reputational risk" as a supervisory category, following pressure from Congress and new guidance from both the FDIC and the OCC. This narrows the oversight lens just as emerging sectors, crypto, private fintech, AI-run financial platforms are gaining ground.

https://www.reuters.com/business/finance/fdic-says-banks-can-engage-crypto-activities-without-prior-approval-2025-03-28/
The FDIC has formally reversed its stance on crypto activity, stating banks no longer need prior approval to engage in cryptocurrency operations so long as they manage risks "appropriately." This marks a shift toward privatized digital finance with looser oversight, at a time when regulatory capacity is shrinking.

https://www.cftc.gov/PressRoom/PressReleases/9059-25
In parallel, the Commodity Futures Trading Commission (CFTC) quietly withdrew its advisory imposing stricter conditions on crypto derivatives, further aligning regulatory stances across financial sectors toward lighter oversight.

https://www.fdic.gov/quarterly-banking-profile/statement-acting-chairman-travis-hill-problem-bank-assets
The FDIC has ended its decades-long practice of disclosing the total assets of banks on its "problem bank" list, leaving only a raw count of how many institutions are in distress. The size of potential risk is now intentionally hidden.

https://newrepublic.com/post/193279/republicans-banks-overdraft-fees-consumer-protection
Congress has also advanced legislation easing restrictions on banks' ability to charge overdraft fees and removing limits on penalties for bounced checks. This measure dismantles existing consumer protections, signaling a coordinated effort to shift financial risk and burden further onto ordinary consumers.

So FDIC protection is just a shrug of the shoulders at this point? I could probably get better protection with SIPC.

Sigh.

I know the last time I went to Navy Federal ( which was about 3 weeks ago) there was a sign on the door that limits withdrawals to $3k.

I don't know if that's still the case though and if that was just related to tax refund withdrawals possibly.

Starks posted...

So FDIC protection is just a shrug of the shoulders at this point? I could probably get better protection with SIPC.

For now, but Musk has already gone after other independent federal nonprofits

jefffan posted...

Sigh.

I know the last time I went to Navy Federal ( which was about 3 weeks ago) there was a sign on the door that limits withdrawals to $3k.

I don't know if that's still the case though and if that was just related to tax refund withdrawals possibly.

NFCU isn't covered by the FDIC. As a credit union, it is subject to the NCUA. I'm not sure how intertwined their regulations are.

This is not good.

Sariana21 posted...

NFCU isn't covered by the FDIC. As a credit union, it is subject to the NCUA. I'm not sure how intertwined their regulations are.

True. But if they're going after one they won't leave the other alone.

Yep. The 250,000 dollars of insured money in FDIC compliant banks going away is gonna hurt. People are giddy for Elon's potential checks from doge he won't be sending out without realizing they are potentially stealing 250K from you!

Which step is this for the rich's plan to steal every bit of wealth away from the working class with zero consequences?

Time to withdraw my savings and hide it under a tree

Get in loser, were bringing back bank runs

Board_hunter567 posted...

Which step is this for the rich's plan to steal every bit of wealth away from the working class with zero consequences?

Worst case scenario:
The rich move their money to Europe
They start hawking crypto
The dollar plummets
The number in your savings account doesn't mean anything
Crypto plummets like it always does when the rich cash out
The number in your crypto account doesn't mean anything either

Bump for evening crowd. This on top of tariffs

quick, everyone take your money out of the bank and put it in crypto!

what could possibly go wrong?

I'm going to be begging for a mere Bush level recession before this is all over, aren't I?

Do I withdraw what modest savings I have...?

I get that they see the word "probation" and see it as a bad thing but when people get promoted they in a probationary period as they learn their new job.

Tom_Joad posted...

This is not good.

But Tom.

She laughed, buddy. You just can't let something like that slide!

https://gamefaqs.gamespot.com/a/forum/c/c8e0c683.jpg

See, they love crypto because it's SO UNREGULATED GUYS. Insurance for your stupid cash money is SO LAME DUDE