One Year After Synapse Financial Collapse, Warren Presses Fed Nominee Bowman on Her Failed Responsibility to Prevent Meltdown
“One year ago today, more than 100,000 consumers had their funds frozen … you did not respond to the clear warning signs in the years leading up to the Evolve-Synapse meltdown.”
Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking, Housing and Urban Affairs Committee, wrote to Federal Reserve (Fed) Vice Chair nominee Michelle Bowman on the one-year anniversary of the Evolve-Synapse financial collapse that led over 100,000 consumers to lose access to hundreds of millions of dollars in deposits. The letter seeks answers from Bowman on her failure as Chair of the Fed’s Committee on Consumer and Community Affairs to appropriately supervise Evolve Bank, Synapse Financial’s primary bank partner, leading up to Synapses’s bankruptcy. The letter was also signed by Senators Ron Wyden, Ranking Member of the Senate Finance Committee (D-Ore.), Tammy Baldwin (D-Wis.), and John Fetterman (D-Penn.).
“When one of Evolve’s fintech partners, Synapse Financial, filed for bankruptcy one year ago today, more than 100,000 consumers had their funds frozen. Many consumers had to wait months before their funds were returned, while some consumers have not yet been made whole due to the disappearance of $65 million - $95 million in funds,” wrote the senators.
The senators continued: “The Evolve-Synapse disaster did not develop overnight. There were several troubling warning signs that should have prompted immediate supervisory and enforcement intervention from the Federal Reserve, which could have avoided, or at least mitigated, the damage.”
The letter requests examination records, staff communications, and other materials to help understand how Governor Bowman and the Federal Reserve failed to ensure Evolve Bank complied with all applicable federal consumer financial laws.
Michelle Bowman is President Trump’s nominee for Fed Vice Chair for Supervision. Ranking Member Warren has previously laid out her serious concerns that Bowman will put Wall Street over working people in this critical role at her nomination hearing in the Senate Banking Committee and in a letter beforehand.
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