Cross River Bank

Documented events with consequences still open. Each entry carries a source and a date.

1. Mar 8, 2023 Regulatory action Severe ● open

   FDIC consent order for unsafe or unsound banking practices in fair lending compliance: Cross River cannot enter new fintech partnerships without the regulator's prior approval

   The document is public and we read it in full: it is consent order FDIC-22-0040b, issued by the Federal Deposit Insurance Corporation against Cross River Bank, Teaneck, New Jersey. The bank signed the stipulation on 8 March 2023; the FDIC made it public on 28 April 2023 together with the month's other actions. WHAT THE REGULATOR FOUND. The FDIC "considered the matter and determined" that the bank engaged in unsafe or unsound banking practices related to its compliance with applicable fair lending laws and regulations, "by failing to establish and maintain internal controls, information systems, and prudent credit underwriting practices" in conformance with the safety and soundness standards of Appendix A to 12 C.F.R. Part 364, or violations of the Equal Credit Opportunity Act (Regulation B) and the Truth-in-Lending Act (Regulation Z). The finding stems from the 3 May 2021 Consumer Compliance Report of Examination. ONE CLARIFICATION THAT HAS TO BE MADE. In the text the bank "neither admits nor denies" the charges: that is the standard formula of US consent orders. The order does not accuse Cross River of any specific discriminatory practice and does not require it to make restitution to customers. What it does describe is a control failure: the bank lent through fintech partners that decided creditworthiness with automated algorithms, and in the regulator's view it did not have oversight adequate to that model. WHY IT MATTERS IF YOU ARE CHOOSING A SPONSOR BANK. The order requires the board to "immediately" increase its supervision of the system of internal controls, information systems, credit underwriting practices and internal audit related to consumer protection laws — what the bank itself calls its Marketplace Lending Compliance Management System. But the clause that changes things in practice is another one: Cross River must carry out enhanced due diligence and obtain the FDIC's prior approval before entering any new fintech partnership. For anyone evaluating Cross River as a BIN sponsor, that means onboarding a new programme does not depend on the bank alone. STATUS AT THE VERIFICATION DATE. A consent order stays in force until the FDIC formally terminates, modifies or suspends it. As of this verification no termination order appears to have been published, and the most recent press coverage (July 2026, about Cross River's role as the FDIC-insured bank behind X Money) still describes it as active. We write that as a check on what is publicly on the record, not as a certainty: if and when the FDIC publishes a termination, this entry should be closed.

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2. Mar 28, 2018 Fine Moderate $642K ✓ resolved

   FDIC civil money penalty of $641,750 for unfair and deceptive practices on consolidation loans sold through Freedom Financial, with $20 million set aside to repay consumers

   On 28 March 2018 the FDIC announced settlements with Cross River Bank (Teaneck, New Jersey) and Freedom Financial Asset Management, LLC (San Mateo, California) for unfair and deceptive practices in violation of Section 5 of the Federal Trade Commission Act, in the marketing and origination of "Consolidation Plus" loans, offered exclusively to consumers already contracted with the affiliated debt settlement company, Freedom Debt Relief. WHAT WAS FOUND. According to the regulator, consumers were required to sign loan documents without knowing the loan's essential terms; they were not told that major creditors do not negotiate with the debt settlement company; they were told the loan would result in all their debts being settled within 30 to 45 or 30 to 90 days; and the claims about credit improvement were misleading too. Violations of the Truth in Lending Act and the Electronic Fund Transfer Act were found alongside. THE FIGURES. A civil money penalty of $641,750 against Cross River Bank and $493,500 against Freedom Financial Asset Management. Separately, $20 million was placed in a segregated account to provide restitution to harmed consumers; in its release the FDIC specifies that the exact final restitution amount had not yet been determined. Both firms stipulated to their respective consent orders without admitting or denying the violations. HOW WE COUNT IT. We treat this as a closed case: the proceeding ended in a settlement, the penalties were assessed and the restitution fund was established. What no public document we could find reports is the final amount actually distributed to consumers: we say so because money set aside and money received are not the same thing, and here only the first of the two is documented. WHY IT STAYS ON THE CARD EIGHT YEARS ON. Not to tally up precedents, but because it is the same pattern as the 2023 order: a bank lending through a third-party partner and answering for how that partner treats the end customer. On a card aimed at people evaluating Cross River precisely as infrastructure operated on behalf of others, the two facts read together.

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verified on Sep 27, 2026