The US Federal Deposit Insurance Corporation (FDIC) is facing accusations of withholding key documents related to its “pause letters,” impacting crypto-related banking activities. This is part of an ongoing lawsuit filed by Coinbase through the Freedom of Information Act (FOIA).
The FDIC has been criticized for its lack of transparency. Coinbase CLO Paul Grewal has claimed that the FDIC has intentionally refused to provide additional pause letters. Grewal said that the FDIC’s search for these documents was limited and that they were essential materials. It would impact the banking sector’s view on cryptocurrency were left out.
As per one of the redacted letters turned in on Jan. 3, the FDIC sent 25 pause letters thus far, but these were incomplete and did not follow the FOIA request. The firm hired by History Associates, the company that litigated the case, verified this. As well, the FDIC is reported to have recognized that their search did not encompass all potential sources. In turn, might have contributed to the omissions of certain documents.
The FDIC, which hadn’t had any insider information before, now starts to get more reports. It suggests that ICERs are a revealing case about them. Those who say otherwise state that the agency has classified incorrect documents. Additionally, has declined FOIA requests by not consulting some databases.
Coinbase plans to amend lawsuit over FDIC’s non-compliance
The dealings of History Associates have since fallen out of the legal document, and they have asked the couriers to be the middlemen in getting to the sealed records. In addition, they intend to change the legal argument to challenge the agency’s incompetency in complying with the FOIA regulations and the proper search for records.
The talk has taken a turn, with Senator Cynthia Lummis having referred to the reports of whistleblowers at the FDIC who say that the agency is removing materials containing information about digital assets. Furthermore, they are trying to push the FDIC to start preserving evidence and avoid any deletion of sensitive information.
The matter is still in full swing and always stands a good chance, with Coinbase and History Associates adhering to full openness. The plaintiffs are bearing no worries no matter how harsh the opposition from the FDIC is. They claim that the FDIC has done that deliberately, planning to jeopardize the legal process by limiting access. It is crucial for the documents that would revolutionize the crypto banking landscape in the US.
