WASHINGTON, D.C. – U.S. Senator Bob Menendez (D-N.J.), a senior member of the Senate Committee on Banking, Housing, and Urban Affairs in Tuesday’s hearing, “Oversight of Financial Regulators: A Strong Banking and Credit Union System for Main Street,” questioned federal financial regulators on the lack of safeguards for investors in digital assets and called for Congressional action to protect consumers.
According to reports, the collapsed crypto exchange FTX and its related businesses could owe money to more than one million people and organizations.
“The collapse of FTX last week is the latest in a series of high-profile crypto collapses this year, which have left investors locked out and facing uncertain prospects for recovering their money,” Menendez said. “Many of these firms are marketing themselves to consumers as safe and responsible while engaging in risky behaviors without the guardrails and safety nets that exist within the traditional financial system. With yet another large crypto exchange crashing, Congress and the regulators need to step up efforts to determine what regulations are needed to ensure investors and the overall financial system are protected.”
Sen. Menendez also questioned regulators on the importance of modernizing language access resources in the proposed Community Reinvestment Act (CRA) update and efforts to improve diversity within the Federal Reserve, especially as it relates to Latinos in leadership positions across the Federal Reserve Banks.
“According to the Census Bureau, there are over twenty-six million limited English proficient consumers in the United States, with 17 million of those consumers speaking predominantly Spanish,” Menendez said. “I hope you all seriously consider in your services test an evaluation of a bank’s ability to serve those with limited English proficiency.”
Sen. Menendez has been a leader in the fight to protect consumers and national security from cryptocurrency-related risks. In September, Sen. Menendez joined a letter urging Meta to provide information about the company’s efforts to combat cryptocurrency scams and hold bad actors accountable for cryptocurrency fraud on its platforms.
In March, Sen. Menendez joined colleagues and introduced the Digital Asset Sanctions Compliance Enhancement Act to ensure that Vladimir Putin and Russian elites cannot use digital assets to undermine the international community’s economic sanctions against Russia following its unprovoked invasion of Ukraine.
The Senator has also long been a champion for addressing the long-standing diversity problems at the Federal Reserve. In May, Senator Menendez voted against the confirmation of Powell to serve a second term as Chair of the Federal Reserve Board of Governors given the Federal Reserve’s failure under his leadership to appoint Latinos at the highest levels of the Fed’s leadership.
Menendez also led 21 colleagues from the Congressional Hispanic Caucus in urging the Fed to choose a Latino candidate as the next President of the Dallas Federal Reserve Bank, which was the most recent missed opportunity by the Federal Reserve to appoint a Hispanic or Latino American as president of a regional Federal Reserve Bank. Sen. Menendez has also called on the Fed to appoint a qualified Latino for the Chicago Presidency.