States Sue to Block ‘First Fintech Charter’ Bank Application (1)

State bank supervisors are suing to block a federal regulator from granting a national bank charter to Figure Technologies, a blockchain-based financial services provider.

The Office of the Comptroller of the Currency would be preempting state authority to regulate non-banks if the application is approved, the Conference of State Bank Supervisors argued in a complaint filed Tuesday in the U.S. District Court for the District of Columbia.

A financial company that doesn’t obtain deposit insurance from the Federal Deposit Insurance Corporation—as Figure plans to do—isn’t a bank, the CSBS said.

Approving Figure’s application would result in the OCC going “far ...