Fed Drops ‘Reputational Risk’ Checks, Is it Good for Crypto?
The Federal Reserve announced Monday it will stop checking banks for “reputational risk” when doing its regular reviews. This means it will no longer judge banks based on how public opinion or bad press could harm their image.
The change applies across all banks under the Fed’s watch, and examiners will now only look at risks that directly affect money, operations, or laws. “The Board has started the process of reviewing and removing references to reputation and reputational risk,” the Fed said in a statement.
Reputational risk meant banks could get flagged by regulators even if they followed the law, just because something they did might upset the public or attract negative media. For years, banks complained that this rule was…
