The Federal Deposit Insurance coverage Company (FDIC) has launched a probe into the bankrupt crypto firm Voyager Digital for allegedly deceiving customers.
FDIC is a shopper safety company that insures consumer deposits, oversees monetary establishments, together with banks, for security, and protects buyers within the occasion of financial institution failures.
Voyager Digital, the Toronto-based crypto agency, reportedly marketed that every one depositors within the agency had been coated by FDIC insurance coverage via its partnership with Metropolitan Industrial Financial institution, Voyager’s banking associate.
In easy phrases, it might have offered Voyager as FDIC insured.
The FDIC spokesperson confirmed to Bloomberg that solely Metropolitan Industrial Financial institution is insured, not Voyager.
Therefore, the depositors are usually not protected towards Voyager’s failure, together with chapter and loss in worth of merchandise.
Final week, Voyager filed for chapter after considered one of its vital debtors, Three Arrows Capital, which owes $650 million, went bancrupt, leaving its consumer funds in danger.
On July 6, the Toronto Inventory Trade (TSX) suspended the buying and selling of Voyager’s inventory (TSE: VOYG) at round $0.27, a 98% decline year-to-date.
At this time, Voyager has introduced that they may voluntarily delist their shares from the Toronto Inventory Trade (TSX). Buying and selling can also be halted in U.S OTC Markets.
Voyager misrepresents FDIC Insurance coverage
In a weblog publish courting again to December 2019, Voyager defined that the FDIC insurance coverage covers each Voyager and its banking associate’s failure.
“In the uncommon occasion your USD funds are compromised because of the firm or our banking associate’s failure, you’re assured a full reimbursement (as much as $250,000),” learn the publish, in line with internet archives.
Yesterday, this wording was, nevertheless, modified, and the safety of FDIC insurance coverage towards Voyager’s failures was eliminated.
As an alternative, the next now seems: “Within the uncommon occasion your USD funds are compromised, you’re assured a full reimbursement (as much as $250,000), so the money you maintain with Voyager is protected.”
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