The Independent Community Bankers of America (ICBA) sued the Office of the Comptroller of the Currency (OCC) and Comptroller Jonathan V. Gould on Friday, October 2, 2026, in the US District Court for the District of Columbia. Filed under the Administrative Procedure Act (APA), the complaint asks the court to vacate the OCC’s March 2, 2026 final rule on chartering and Interpretive Letter No. 1176 (IL 1176), the two texts behind its national trust bank charters for crypto firms. It also targets the conditional approval granted in February to Protego Holdings, a Seattle digital asset company.
“Congress did not create the national trust charter as a side door into the banking system for crypto firms seeking the credibility of a federal bank charter without the Community Reinvestment Act obligations, consolidated supervision, capital and liquidity standards, and FDIC insurance that apply to insured depository institutions,” ICBA President and CEO Rebeca Romero Rainey said. An OCC spokesperson told PYMNTS the agency does not comment on litigation.
The case turns on a sentence Congress added in 1978
That sentence, in the National Bank Act, says a national bank “is not illegally constituted solely because its operations are or have been required by the Comptroller of the Currency to be limited to those of a trust company and activities related thereto.” ICBA reads it as allowing the OCC to limit a charter to fiduciary work. IL 1176, dated January 11, 2021, and written by Gould when he was the OCC’s senior deputy comptroller and chief counsel, read it as authority to charter any company engaged in a trust company’s activities, including non-fiduciary ones. ICBA says that opens the charter to firms that neither take deposits nor act as fiduciaries.
The final rule wrote that reading into the OCC’s chartering regulation, replacing “fiduciary activities” with “operations of a trust company and activities related thereto.” When it issued the rule, the OCC said it “would neither expand nor contract the OCC’s authority to charter a national bank.” ICBA says the agency adopted it unchanged and answered objections in two pages.
No deposit insurance and no consolidated supervision
According to the complaint, a national trust bank needs no FDIC deposit insurance and escapes Bank Holding Company Act rules, including the separation of banking from commerce and Federal Reserve consolidated supervision of its parent. Prompt corrective action and the Volcker Rule do not apply, and the national charter preempts many state laws, including some consumer protection laws. Customers, ICBA argues, will assume that a company with “national bank” in its name is insured.
Protego is on its second try at a federal charter
The OCC granted preliminary conditional approval on February 13, 2026, to National Digital Trust Company, a proposed Seattle trust bank wholly owned by Protego Holdings Corporation. The bank plans four business lines, mainly in crypto assets: custody, trading, lending and borrowing, and issuer services for tokenization. The complaint says a first OCC conditional approval for Protego, granted in 2021, expired in 2023 without the bank opening, and that the company laid off more than half its workforce that year. Banking Dive reported that FTX was among Protego’s investors.
A stablecoin issuer takes the same route
On September 18, the OCC conditionally approved the conversion of Bastion’s New York trust company into Bastion Platforms National Trust Company, an uninsured trust bank that plans white-label stablecoin issuance. ICBA argues that the GENIUS Act, the federal stablecoin law, cannot cure the problem: it takes effect only on January 18, 2027, or 120 days after final implementing rules, whichever comes first, and it does not amend the provisions at issue.
“Companies should not receive trust charters unless they plan to limit their operations to genuine trust activities,” said Paige Pidano Paridon, executive vice president and co-head of regulatory affairs at the Bank Policy Institute. On October 5, Crypto Council for Innovation CEO Ji Hun Kim called the suit “a clear attempt to resist national trust charters, payments innovation, and competition in financial services.” Gould, who has defended the approvals, said in May at a Semafor event: “we don’t have a zero risk tolerance anymore.”