Breaking: Custodia Bank Files Appeal Stating Fed’s Law Violation & Dual Banking System

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As a researcher with extensive experience in banking law, I am closely following the developments in the Custodia Bank vs. Fed case. The filing of the opening brief by Custodia Bank in the 10th Circuit Court of Appeals is an important step in this legal battle.

Expert: In the 10th Circuit Court of Appeals, Custodia Bank has submitted its opening argument. The bank is contesting a Wyoming judge’s ruling that granted the Federal Reserve the authority to prevent it from obtaining a master account. Furthermore, the brief advocates for the appeals court to direct the Wyoming district court to rescind its denial and issue a master account to Custodia Bank instead.

Custodia Bank Files Opening Brief In 10th Circuit

Expert: Custodia Bank’s CEO, Caitlin Long, has recruited two seasoned Supreme Court lawyers for their legal action against the Federal Reserve. The lawyers’ primary concerns revolve around several pivotal issues, such as the alleged infringement of the dual banking system. According to Custodia Bank’s legal team, the Fed’s power to reject master accounts for state-chartered banks threatens the very foundation of the dual banking system.

As an analyst, I would put it this way: I analyze the banking regulatory landscape, and it’s essential to note that banks have the option to opt for either a state charter or a federal charter. This distinction is crucial because it reflects our country’s dual banking system. The 10th Circuit Court case of Cantero v. Bank of America further clarified this point, stating, “The US administers a dual banking system, with both federal and state entities playing significant roles.”

As a crypto investor, I’d interpret this as: The lawyers for Custodia have raised an important point regarding the Fed’s potential discrimination against state-chartered banks. They argue that such actions could conflict with the Monetary Control Act (MCA). This legislation is designed to guarantee equal access for all state-chartered banks to the Federal Reserve’s services. Furthermore, they emphasized that the MCA mandates “shall be available” to non-member depository institutions, implying a clear obligation for the Fed to provide these services.

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2024-06-27 09:12