On September 17, 2024, the Federal Deposit Insurance Corporation released a proposed rule that would impose new recordkeeping and reconciliation requirements on banks that maintain “custodial deposit accounts with transactional features." As described further below, the proposed rule is a response to the recent bankruptcy of Synapse Financial Technologies, Inc. If finalized, the rule would require significant changes to the account structures and ledgering and reconciliation processes that many banks and financial technology providers (fintechs) have used in connection with bank-fintech relationships. The FDIC would promulgate the rule under its authority as deposit insurer and resolution authority for all insured banks, and the proposal would apply to all insured banks that maintain accounts within scope of the rule, not only large banks or those banks for which the FDIC is the primary federal regulator.
Comments on the proposal will be due 60 days after publication in the Federal Register.