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Open Recommendations (9 total)

Bank Supervision: Federal Reserve and FDIC Should Address Weaknesses in Their Process for Escalating Supervisory Concerns [Reissued with revisions on Nov. 25, 2024]

GAO-25-106771
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2 Open Recommendations
Agency Affected Recommendation Status
Federal Deposit Insurance Corporation The Chair of FDIC should consider a requirement that case managers for Continuous Examination process institutions periodically rotate assignments. (Recommendation 5)
Open
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Federal Deposit Insurance Corporation The Chair of FDIC should develop a central database for recording and reporting supervisory recommendations, similar to that used for matters requiring board attention. (Recommendation 3)
Open
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

Bank Supervision: Federal Reserve and FDIC Should Address Weaknesses in Their Process for Escalating Supervisory Concerns [Reissued with revisions on Nov. 25, 2024]

GAO-25-106771
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1 Open Recommendations
Agency Affected Recommendation Status
Federal Deposit Insurance Corporation The Chair of FDIC should establish procedures, such as vetting meetings, for the Continuous Examination process program to ensure that managers formally consult with the examination team and relevant stakeholders before making substantive changes to examination findings. Such vetting meetings should be documented and include any divergent views that arise. (Recommendation 4)
Open
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

Sexual Harassment: Actions Needed to Improve Prevention Training for Federal Civilian Employees

GAO-24-106589
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1 Open Recommendations
Agency Affected Recommendation Status
Federal Deposit Insurance Corporation The Chairman of the Federal Deposit Insurance Corporation should develop and implement a plan to evaluate the agency's required sexual harassment prevention training to identify needed improvements. The evaluation plan should include an assessment of training content and implementation to determine whether revisions are needed to better align with management practices to enhance the effectiveness of sexual harassment prevention training. (Recommendation 4)
Open
The Federal Deposit Insurance Corporation concurred with this recommendation. We have not yet received information on their efforts to address the recommendation and we will update its status once information is received.

Financial Technology: Agencies Can Better Support Workforce Expertise and Measure the Performance of Innovation Offices

GAO-23-106168
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1 Open Recommendations
Agency Affected Recommendation Status
Federal Deposit Insurance Corporation The Chair of the Federal Deposit Insurance Corporation should fully incorporate leading workforce planning practices for the primary offices involved in policymaking and oversight related to financial technology by collecting staff skillset data and determining the critical financial technology skills the agency needs; developing targeted strategies to address financial technology-related skills gaps; and measuring the effectiveness of its financial technology-related training in addressing skill needs. (Recommendation 4)
Open
In June 2024, FDIC officials told us the agency is working on corrective actions to address this recommendation. FDIC expects to complete this process by December 31, 2024. We will continue to monitor agency progress towards implementing this recommendation.

Blockchain in Finance: Legislative and Regulatory Actions Are Needed to Ensure Comprehensive Oversight of Crypto Assets

GAO-23-105346
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1 Open Recommendations
1 Priority
Agency Affected Recommendation Status
Federal Deposit Insurance Corporation
Priority Rec.
The Chairman of the Federal Deposit Insurance Corporation should jointly establish or adapt an existing formal coordination mechanism with CFPB, CFTC, the Federal Reserve, NCUA, OCC, and SEC for collectively identifying risks posed by blockchain-related products and services and formulating a timely regulatory response. To facilitate these objectives, this mechanism could include formal planning documents that establish the frequency of meetings and processes for identifying risks and responding to them within agreed-upon time frames. (Recommendation 3)
Open – Partially Addressed
FDIC neither agreed nor disagreed with the recommendation. In addition, FDIC noted it has coordinated through venues including the Financial Stability Oversight Council, the President's Working Group, and some international organizations. However, the regulators' coordination efforts have not always addressed risks posed by crypto assets in a timely manner. In April 2024, several of the financial regulators told us that the Financial Stability Oversight Council (of which CFPB, CFTC, FDIC, the Federal Reserve, NCUA, OCC, and SEC are members) established a formal coordination mechanism through the creation of the Digital Asset Working Group to promote information sharing and enhance interagency coordination in identifying potential risks in the digital asset space. They stated that the working group meets regularly and has discussed a variety of topics, including regulatory developments, rulemaking, risks, data collection, and market developments. In July 2024, the agencies provided documentation demonstrating that the working group meets regularly and has developed and implemented processes for identifying risks and regulatory challenges concerning blockchain-related products and services. To fully implement the recommendation, the agencies should continue to work towards developing processes for responding to those risks and challenges that cross regulatory jurisdictions within agreed-upon timeframes.

Banking Services: Regulators Have Taken Actions to Increase Access, but Measurement of Actions' Effectiveness Could Be Improved

GAO-22-104468
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1 Open Recommendations
Agency Affected Recommendation Status
Federal Deposit Insurance Corporation The Chairman of FDIC should develop and implement outcome-oriented performance measures for its strategic objective of ensuring access to safe and affordable bank services that reflect leading practices, including demonstrating results, measuring outcomes, and providing useful information for decision-making. (Recommendation 1)
Open
In May 2024, FDIC officials said the agency is working on implementation of an outcomes measurement framework that reflects FDIC's updated Economic Inclusion Strategic Plan. The officials noted that FDIC's timeframe to complete responsive actions on this recommendation has shifted to June 2025. We will continue to monitor FDIC's progress towards implementing this recommendation.

Bank Supervision: FDIC Could Better Address Regulatory Capture Risks

GAO-20-519
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1 Open Recommendations
Agency Affected Recommendation Status
Federal Deposit Insurance Corporation The Division Director for Risk Management Supervision (RMS) should require case managers to document how high-risk areas in the scoping plan were considered by the examination team if they were not addressed in the examination report. (Recommendation 1)
Open
In November 2021, FDIC officials provided documentation of examination policies they updated in March 2021 to require that examiners-in-charge discuss proposed changes to the examination scope with their manager and obtain concurrence for any material changes in the examination scope. Although this policy change likely would improve management's control over changes to scoping plans, it would not necessarily create better documentation to track how FDIC's case managers reviewed whether the work described in the scoping plan was appropriately evaluated and documented by the examination team. As stated in our report, if case managers documented that examination procedures for areas not discussed in the examination report were assessed and that examiners' conclusions about these areas were well-supported, RMS management would have better assurance that case managers were monitoring examination teams' procedures and conclusions for all planned aspects of the examination. We continue to believe that RMS management could better assure the effectiveness of the case-manager review process by implementing a requirement for case managers to review and document how all elements of the examination scope--including those not discussed in the report of examination--were addressed by the examination team. In August 2023, FDIC officials indicated that they did not intend to take further steps beyond those already taken to address this recommendation.

Financial Technology: Agencies Should Provide Clarification on Lenders' Use of Alternative Data [Reissued with revisions on Mar. 12, 2019.]

GAO-19-111
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1 Open Recommendations
1 Priority
Agency Affected Recommendation Status
Federal Deposit Insurance Corporation
Priority Rec.
The Chairman of the Federal Deposit Insurance Corporation should, in coordination with the other federal banking regulators and the Bureau of Consumer Financial Protection and with input from relevant stakeholders, communicate in writing to banks that engage in third-party relationships with fintech lenders on the appropriate use of alternative data in the underwriting process, including issues to consider when selecting types of alternative data to use. (Recommendation 3)
Open
In December 2019, the Board of Governors of the Federal Reserve System, the Consumer Financial Protection Bureau, the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration, and the Office of the Comptroller of the Currency (the agencies) issued an interagency statement on the use of alternative data in credit underwriting. The statement broadly highlights some potential benefits and risks of using alternative data and encourages firms to responsibly use alternative data. However, the statement does not provide firms or banks with specific direction on the appropriate use of alternative data. In March 2021, the federal banking regulators and the Consumer Financial Protection Bureau issued a request for information (RFI) on Financial Institutions' Use of Artificial Intelligence, including Machine Learning, and in July 2021, the banking regulators issued proposed third party risk management guidance for comment, both of which discuss alternative data. In June 2023, the banking regulators issued final interagency guidance on third party risk management, but the guidance does not address specific topics, such as alternative data, or specific types of third-party relationships, such as relationships with fintech companies. Further, the banking regulators and Consumer Financial Protection Bureau have not issued any documentation related to the RFI as of April 9, 2024. To fully implement this recommendation, FDIC needs to provide, in coordination with other federal banking regulators and the Consumer Financial Protection Bureau, finalized written communication that gives banks that engage in third party relationships with fintech lenders specific direction on the appropriate use of alternative data in the underwriting process. Without such direction, banks partnering with financial technology lenders may not effectively manage associated risks, including compliance with fair lending and other consumer protection laws.
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