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[¶11,763] In the Matter of Michael R. Karnes, Murphy-Wall State Bank,
Pinckneyville, Illinois, Docket No. 00-093e (2-5-01)
Respondent prohibited from participating in the conduct of affairs of,
or exercising voting rights in, any insured institution without the
prior written approval of the FDIC.
[.1] Prohibition, Removal or SuspensionProhibition FromParticipation in
Conduct of Affairs
[.2] Prohibition, Removal or SuspensionProhibition FromVoting Rights,
Exercise of
In the Matter of
MICHAEL R. KARNES
individually, and as an institution-affiliated
party of
MURPHY-WALL STATE BANK
PINCKNEYVILLE, ILLINOIS
(Insured State Nonmember Bank)
ORDER OF PROHIBITION FROM FURTHER PARTICIPATION
FDIC-00-093e
Michael R. Karnes ("Respondent") has been advised of the
right to receive a NOTICE OF INTENTION TO PROHIBIT FROM FURTHER
PARTICIPATION ("NOTICE") issued by the Federal Deposit Insurance
Corporation ("FDIC") detailing the violations of law or
regulation, unsafe or unsound banking practices, and breaches of
fiduciary duty for which an ORDER OF PROHIBITION FROM FURTHER
PARTICIPATION ("ORDER") may issue, and has been further advised
of the right to a hearing on the charges under section 8(e) of the
Federal Deposit Insurance Act ("Act"), 12 U.S.C. §1818(e), and
the FDIC Rules of Practice and Procedure, 12 C.F.R. Part 308. Having
waived those rights, the 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
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Division of the FDIC, whereby solely for the purpose of this
proceeding and without admitting or denying any violations of law or
regulations, unsafe or unsound banking practices, and/or breaches of
fiduciary duty, Respondent consented to the issuance of an ORDER by the
FDIC.
The FDIC considered the matter and determined it had reason to believe
that:
(a) The Respondent has engaged or participated in violations of
law or regulation, unsafe or unsound banking practice, and/or breaches
of fiduciary duty as an institution-affiliated party of Murphy-Wall
State Bank, Pinckneyville, Illinois ("Bank");
(b) By reason of such violations, practices, and/or breaches of
fiduciary duty, the Bank has suffered or will probably suffer financial
loss or other damages, and/or the Respondent received financial gain or
other benefit and the interests of the Bank's depositors have been or
could be prejudiced; and
(c) Such violations, practices, and/or breaches of fiduciary duty
involve personal dishonesty on the part of the Respondent or
demonstrate the Respondent's willful and/or continuing disregard for
the safety and soundness of the Bank.
The FDIC further determined that such violations, practices,
and/or breaches of fiduciary duty demonstrate the Respondent's
unfitness to serve as a director, officer, person participating in the
conduct of the affairs or as an institution-affiliated party of the
Bank, any other insured depository institution, or any other agency or
organization enumerated in section 8(e)(7)(A) of the Act, 12 U.S.C.
§1818(e)(7)(A).
The FDIC, therefore, accepted the CONSENT AGREEMENT and issued the
following:
ORDER OF PROHIBITION FROM FURTHER PARTICIPATION
1. Michael R. Karnes is hereby, 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), prohibited from:
[.1] (a) participating in any manner in the conduct of the affairs of any
financial institution or organization enumerated in section 8(e)(7)(A)
of the Act, 12 U.S.C. §1818 (e)(7)(A);
[.2] (b) soliciting, procuring, transferring, attempting to transfer,
voting, or attempting to vote on any proxy, consent or authorization
with respect to any voting rights in any financial institution
enumerated in section 8(e)(7)(A) of the Act, 12 U.S.C. §1818
(e)(7)(A);
(c) violating any voting agreement previously approved by the
appropriate Federal banking agency; or
(d) voting for a director, or serving or acting as an
institution-affiliated party.
2. This ORDER will become effective ten (10) days after its issuance.
The provisions of this ORDER will 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 this 5th day of February, 2001.