The Federal Deposit Insurance Corporation said a July tweet by Brett Harrison, head of FTX’s U.S. operations, contained misleading claims that funds held at and stocks purchased through FTX were FDIC insured, and ordered the company to remove any misleading language from its social media accounts and websites.
In the tweet, which Harrison has since deleted, he stated that direct deposits from employers to the crypto exchange are “stored in individually FDIC-insured bank accounts” and that stocks purchased via FTX US “are held in FDIC-insured” brokerage accounts. The FDIC said in its cease and desist letter to FTX US that those statements implied that FDIC insurance was available for cryptocurrency and stock holdings, and that the agency does not insure brokerage accounts.
In a tweet on Friday, FTX CEO Sam Bankman-Fried emphasized FTX is not FDIC-insured, and apologized if anyone misinterpreted previous comments.
It’s worth noting that FTX has previously been in trouble with the FDIC for misrepresenting how funds were stored: https://www.msn.com/en-ca/money/topstories/crypto-exchange-ftx-ordered-to-halt-false-and-misleading-claims-by-us-bank-regulator/ar-AA10QJdY