President-elect Donald Trump’s transition team is looking at ways to either reform, reorganize or completely eliminate the Federal Deposit Insurance Corporation (FDIC), a federal agency that provides insurance for banks to ensure that customers’ money can be recovered in the case of a bank closure.
Any changes to the FDIC, an independent agency created in the Great Depression era that insures banking customers’ deposits, would be controversial, to say the least.
Citing sources familiar with these discussions, The Wall Street Journal reported last week that individuals seeking to be part of the incoming administration are being asked by the Trump transition team and members of the Department of Government Efficiency (DOGE) task force if they believe the FDIC can be changed in some manner.
Individuals under consideration for roles within the agency itself, as well as in the Office of the Comptroller of the Currency, are also being asked “if deposit insurance could be absorbed into the Treasury Department” after eliminating the agency, the report noted.
While these questions are being asked of potential executive branch members, any changes to the FDIC would need to be made by a legislative act in Congress.
It’s unclear why the Trump team would want to dismantle or change the FDIC in any way. It’s possible these questions are being asked because of Elon Musk’s support for cryptocurrency, which the FDIC has warned in the past can be risky for banks to work with.
Any of the changes to the agency that are being discussed could have a detrimental effect on customers’ confidence in the banking system.
The FDIC insures customers’ accounts up to $250,000 in their deposits. The agency is........