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FDIC Enforcement Decisions and Orders

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   [10,223] In the Matter of Edwin W. Brown, Docket No. FDIC-90-73e (4-23-91).

   Former officer/director prohibited from further participation in conduct of affairs of, or exercising voting rights in, Bank or any insured institution without prior consent of FDIC.

   [.1] Prohibition—Participation in Conduct of Affairs
   [.2] Prohibition—Exercise of Voting Rights

In the Matter of
EDWIN W. BROWN individually
and/or as an institution-affiliated
party of
TROUP BANK & TRUST COMPANY
TROUP, TEXAS
(Insured State Nonmember Bank)
ORDER OF PROHIBITION FROM
FURTHER PARTICIPATION

   Edwin W. Brown ("Respondent") received a NOTICE OF INTENTION TO PROHIBIT FROM FURTHER PARTICIPATION ("NOTICE") issued by the Federal Deposit Insurance Corporation ("FDIC") pursuant to section 8(e) of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. § 1818(e), on or about May 29, 1990. The NOTICE described the violations of law, unsafe or unsound practices and/or breaches of fiduciary duty allegedly committed by Respondent, individually and/or as an institution-affiliated party of Troup Bank & Trust Company, Troup, Texas ("Depository Institution"), by reason of which the Depository Institution suffered financial loss or other damage, and/or that the interests of deposits were prejudiced and/or that Respondent received financial gain or other benefit; and which demonstrate that such violations, practices, or breaches evidence Respondent's personal dishonesty and/or willful and/or continuing disregard for the safety and soundness of the Depository Institution. The Depository Institution is the subject of receivership proceedings.
   Having been advised of his right to a hearing on the allegations set forth in the NOTICE, under section 8(e) of the Act and Part 308 of the FDIC's Rules and Practice and Procedures, 12 C.F.R. Part 308, and having waived that right, Respondent entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF AN ORDER OF PROHIBITION FROM FURTHER PARTICIPATION ("CONSENT AGREEMENT") with a representative of the Legal Division of the FDIC, dated February 4, 1991, whereby, solely for the purpose of this proceeding and without admitting or denying any of the alleged violations of law, unsafe or unsound banking practices and/or breaches of fiduciary duty, Respondent consented to the issuance of an ORDER OF PROHIBITION FROM FURTHER PARTICIPATION ("ORDER") by the FDIC.
   Having been advised of his right to a hearing on the allegations set forth in the NOTICE, under section 8(e) of the Act and Part 308 of the FDIC's Rules of Practice and Procedures, 12 C.F.R. Part 308, and having waived that right. Respondent entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF AN ORDER OF PROHIBITION FROM FURTHER PARTICIPATION ("CONSENT AGREEMENT") with a representative of the Legal Division of the FDIC, dated February 4, 1991, whereby, solely for the purpose of this proceeding and without admitting or denying any of the alleged violations of law, unsafe or unsound banking practices and/or breaches of fiduciary duty, Respondent consented to the issuance of an ORDER OF PROHIBITION FROM FURTHER PARTICIPATION ("ORDER") by the FDIC.
   The FDIC considered the matter and determined there was reason to believe that:

       (i) Respondent had engaged or participated in violations of law, rule or regulation, unsafe or unsound banking practices and/or breaches of his fiduciary duty as an institution-affiliated party of the Depository Institution;
       (ii) By reason of such violations, practices and/or breaches of fiduciary duty, the Depository Institution suffered financial loss or other damage, the interests of the Depository Institution's depositors were prejudiced and/or the Respondent received financial gain or other benefit; and
       (iii) Such violations, practices and/or
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    breaches of fiduciary duty involved personal dishonesty on the part of Respondent and/or demonstrated Respondent's willful and/or continuing disregard for the safety or soundness of the Depository Institution.
   The FDIC further determined that such violations, practices and/or breaches of fiduciary duty demonstrate Respondent's unfitness to serve or participate as an institution-affiliated party in the conduct of the affairs of any insured depository institution or any other agency or organization enumerated in section 8(e)(7) of the Act, 12 U.S.C. § 1818(e)(7). The FDIC, therefore, accepts the CONSENT AGREEMENT and issues the following:

ORDER OF PROHIBITION FROM
FURTHER PARTICIPATION

   [.1] 1. Edwin W. Brown is hereby prohibited, without the prior written approval of the FDIC and the appropriate Federal financial institutions regulatory agency, as that term is defined in section 8(e)(7)(D) of the Act, 12 U.S.C. § 1818(e)(7)(D), from serving or acting as a director, officer, employee, or institution-affiliated party and/or from participating in any manner in the conduct of the affairs of any of the institutions or agencies listed hereinbelow:

       (i) Any insured depository institution, as defined in section 3(c)(2) of the Act, 12 U.S.C. § 1813(c)(2);
       (ii) Any institution treated as an insured bank under section 8(b)(3) or 8(b)(4) of the Act, 12 U.S.C. § 1818(b)(3) or (b)(4), or any institution treated as a savings association under section 8(b)(8) of the Act, 12 U.S.C. § 1818(b)(8);
       (iii) Any insured credit union under the Federal Credit Union Act, 12 U.S.C. § 1751 et seq.;
       (iv) Any institution chartered under the Farm Credit Act of 1971, 12 U.S.C. § 2001 et seq.;
       (v) Any appropriate Federal depository institution regulatory agency;
       (vi) The Federal Housing Finance Board and any Federal home loan bank; and
       (vii) The Resolution Trust Corporation.

   [.2] 2. Edwin W. Brown is hereby prohibited from voting, either directly or indirectly, for one or more directors of any insured depository institution, without the prior written approval of the FDIC and the appropriate Federal financial institutions regulatory agency, as that term is defined in section 8(e)(7)(D) of the Act, 12 U.S.C. § 1818(e)(7)(D).
   3. Edwin W. Brown is hereby prohibited from soliciting, procuring, transferring, voting, or otherwise attempting to transfer or vote any proxy, consent or authorization with respect to any voting rights in any institution listed in paragraph 1 of this ORDER, without the prior written approval of the FDIC and the appropriate Federal financial institutions regulatory agency, as that term is defined in section 8(e)(7)(D) of the Act, 12 U.S.C. § 1818(e)(7)(D).
   4. Edwin W. Brown is hereby prohibited from violating any voting agreement previously approved by the appropriate Federal financial institutions regulatory agency with regard to any institution listed in paragraph 1 of this ORDER, without the prior written approval of the FDIC and the appropriate Federal financial institutions regulatory agency, as defined in section 8(e)(7)(D) of the Act, 12 U.S.C. § 1818(e)(7)(D).
   5. This ORDER shall become effective ten (10) calendar days following its issuance by the FDIC pursuant to section 8(e) of the Act, 12 U.S.C. § 1818(e), and shall be enforceable pursuant to sections 8(i) and 8(j) of the Act, 12 U.S.C. §§ 1818(i) and 1818(j).
   6. The provisions of this ORDER shall remain effective and enforceable, except to the extent that, and until such time as, any provision of this ORDER shall have been modified, terminated, suspended, or set aside by the FDIC.
   Pursuant to delegated authority.
   Dated at Washington, D.C. this 23rd day of April, 1991.

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