Deposit insurance is the government’s guarantee that an account holder’s money at an insured bank is safe up to a certain amount, currently $250,000 per account. Deposit insurance is provided by the Federal Deposit Insurance Corporation (FDIC), a government agency that collects fees – insurance premiums – from banks. The FDIC is overseen by a five-member board – three nominated by the President and confirmed by the Senate, plus the Comptroller of the Currency and the director of the Consumer Financial Protection Bureau.
Deposit insurance, created during the Great Depression in 1933, has sharply reduced the frequency of bank runs that once were common in the U.S. As former Federal Reserve Chair Ben Bernanke explained in his 2022 Nobel Prize speech, about 40% of all U.S. banks disappeared between 1929 and 1933: “They failed, closed, or were absorbed by other banks. That happened because there were massive runs, bank runs, where people lost confidence in the banks and pulled out their money…The ones that were closed couldn’t make loans, obviously, and the ones that survived became extremely cautious being very reluctant to make loans.”
“Shortly after [Franklin Delano Roosevelt] became president, he called a bank holiday and all the banks had to shut down, and he promised the American public that they wouldn’t open up until the government had inspected them and was confident that they were in viable condition. And then the Congress passed deposit...
Dr. Helen Boerman, once a leader at Remnant Fellowship Church, used the money to fund a lavish lifestyle, including a $7 million home, prosecutors said. She was sentenced to 3.5 years in prison an...