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The Independent Community Bankers of America (ICBA) sued the Office of the Comptroller of the Currency (OCC) on October 2, challenging the agency’s authority to charter non-depository, non-fiduciary national trust banks that conduct substantial cryptocurrency activities.
The lawsuit, filed in the U.S. District Court for the District of Columbia, targets the OCC’s March 2026 final rule governing national trust bank charters, Interpretive Letter No. 1176, and the agency’s conditional approval of Protego Holdings Corp.’s national trust bank charter.
ICBA argues that the OCC exceeded the authority granted under the National Bank Act by allowing firms that do not take deposits and are not primarily engaged in fiduciary activities to operate under a national trust-bank charter. The banking group is asking the court to declare the challenged actions unlawful and vacate them.
ICBA challenges OCC’s expanded trust-bank framework
At the center of the case is the scope of the national trust-bank charter.
The OCC issued Interpretive Letter No. 1176 in 2021, concluding that a national trust bank is not limited to fiduciary activities and can conduct certain non-fiduciary activities when separately authorized under federal banking law.
ICBA has repeatedly challenged that interpretation. In its lawsuit, the group argues that the National Bank Act does not authorize the OCC to create a national banking pathway for companies that neither accept deposits nor primarily perform fiduciary functions.
The group also argues that the OCC should have used formal notice-and-comment rulemaking before expanding the permissible activities of national trust banks. ICBA previously raised the same objection in comments on crypto and fintech charter applications.
The OCC’s 2026 rulemaking followed a January proposal that would allow limited-purpose trust banks to engage substantially in non-fiduciary activities. ICBA opposed that approach and urged the agency to withdraw or revise the proposal.
Crypto firms have become major charter applicants
The lawsuit comes after a series of national trust-bank approvals and applications from crypto and fintech companies.
In February, the OCC approved national trust-bank charters for Stripe’s Bridge National Trust Bank, Protego’s National Digital Trust Company, and Foris DAX National Trust Bank, the proposed U.S. banking subsidiary of Crypto.com, according to ICBA.
Other crypto and payments companies have also pursued the charter. ICBA has separately opposed applications involving companies including Payward, the parent of Kraken, as well as other digital-asset and fintech firms.
ICBA argues that these institutions can obtain a federal charter without being subject to the full set of requirements that apply to federally insured commercial banks. National trust banks that do not accept deposits generally do not have FDIC-insured deposits. They also operate under a different regulatory structure from full-service insured banks, including differences in capital, liquidity, and other prudential requirements.
Warren and large banks also question OCC charters
The ICBA’s lawsuit follows separate criticism from lawmakers and larger banking groups over the OCC’s approach to national trust-bank charters. In May, Senator Elizabeth Warren questioned the agency’s approval of crypto-focused trust charters, arguing that some firms appeared to be conducting activities beyond those permitted under the National Bank Act, according to a Bloomberg report.
Warren cited at least nine national trust charters for crypto companies and questioned whether the firms were eligible for the structure. Her objections center on the same broader issue raised by ICBA: whether the OCC can use the national trust-bank framework for companies whose businesses extend beyond traditional fiduciary activities.
Large U.S. banks have also considered legal action. The Bank Policy Institute, which represents major lenders, was reviewing a possible challenge to the OCC’s chartering approach, according to a March report by The Guardian. The group had not decided at the time whether to file a lawsuit.
Banking groups have separately opposed several crypto and fintech charter applications, including those involving Circle, Ripple and payments company Wise. Their objections have focused on differences between the regulatory requirements for national trust banks and those applicable to traditional insured banks.
Protego charter is also in court challenge
ICBA is separately asking the court to vacate Protego’s conditionally approved national trust-bank charter. The OCC conditionally approved the charter for Protego Holdings in February 2026. The company’s proposed activities include digital-asset custody and other cryptocurrency-related services.
ICBA had previously opposed the application, arguing that the proposed business model included substantial non-fiduciary activities outside the traditional scope of a national trust charter. The group also raised concerns about Protego’s governance, risk-management structure, and financial condition in its objections to the application. Those are ICBA’s allegations and objections, rather than findings by the court.
Community banks cite regulatory differences
ICBA’s broader argument is that the charter framework could create different regulatory requirements for institutions competing in similar financial markets. Traditional community banks that accept insured deposits operate under requirements involving capital, liquidity, consumer protection, the Community Reinvestment Act, and FDIC supervision.
The lawsuit argues that a non-depository national trust bank can provide certain custody, trading, lending, or other financial services without being subject to the same framework. ICBA says that difference could create competitive pressure on community banks and allow crypto companies to expand into banking-related activities under a less extensive regulatory regime.
The group has made similar arguments in its objections to several national trust-bank applications. In December 2025, for example, ICBA criticized the OCC’s conditional approvals of five nonbank fintech charter applications, saying the applicants were seeking access to the banking system without the full regulatory requirements applicable to traditional banks.
Lawsuit raises consumer and supervisory questions
ICBA also argues that the different regulatory treatment could have implications for consumers holding digital assets with national trust banks.
The group says crypto-focused institutions can face risks associated with digital-asset markets, including market volatility, cybersecurity, fraud, and money laundering. It argues that the absence of FDIC insurance and some traditional bank requirements could leave customers with different protections from those available at insured banks. The lawsuit also questions the regulatory framework for resolving an uninsured national bank if it fails.
These arguments form part of ICBA’s case that the OCC should not expand the national trust-bank charter without clearer congressional authorization and a broader regulatory framework.
ICBA seeks to vacate OCC rule and charter approval
The lawsuit was brought under the Administrative Procedure Act. ICBA asks the court to find the OCC’s final rule and Interpretive Letter No. 1176 unlawful and set them aside.
The group is also challenging Protego’s conditional charter approval and is asking the court to vacate that approval. ICBA’s central legal argument is that the OCC cannot use its existing authority under the National Bank Act to establish a national trust-bank pathway for companies that are neither deposit-taking banks nor primarily fiduciary institutions.
The OCC’s interpretation of that authority will now be tested in federal court as crypto and fintech companies continue seeking national trust-bank charters.
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