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FDIC Enforcement Decisions and Orders |
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Bank directors who failed to file a request for a hearing within 10 days of being served with a Notice and Order were assessed final and unappealable civil money
{{4-1-90 p.A-927}}penalties. The FDIC further ruled that a hearing should be open to the public only if necessary to protect the public interest.
[.1] Civil Money PenaltiesHearingPublic or Private
[.2] Civil Money PenaltiesHearingRequest Required
In the matter of * * *, and * * *,
On July 31, 1985, a Notice of Assessment of Civil Money Penalties, Findings of Fact and Conclusions of Law, Order to Pay, and Notice of Hearing ("Notice and Order") was issued pursuant to section 18(j) of the Federal Deposit Insurance Act ("Act"), against Respondents, all directors of the * * * Bank * * *, * * *, now the * * * Bank, * * * ("Bank"). The Notice and Order alleged violations of Section 22(h) of the Federal Reserve Act, 12 U.S.C. § 375b, and Regulation O of the Board of Governors of the Federal Reserve System, 12 C.F.R. Part 215, promulgated thereunder.
1. The Request for Open Hearing
In the Notice and Order the FDIC stated that it was "preliminarily" of the opinion that the hearing should be open to the public. Respondents * * * and * * * have filed formal objection to a public hearing. Respondent * * * argues that the possible publicity will adversely affect the Bank and his attempts to improve its position. Respondent * * * states only that "it is obvious that the situation at the Bank will not be enhanced by a public hearing...." The ALJ has recommended that a public hearing be held in this matter.
[.1] Section 8(h)(1) of the FDI Act provides that administrative enforcement hearings (except (g)(1) suspension hearings) "shall be private, unless the appropriate Federal banking agency, in its discretion, after fully considering the views of the party afforded the hearing, determines that a public hearing is necessary to protect the public interest."
2. Motion to Exclude Respondents * * *, * * * and * * * from the Hearing
Enforcement Counsel for the FDIC has moved for entry of an order excluding Respondents * * *, * * * and * * * from the hearing because each failed to file a request for a hearing within 10 days of being served with the Notice and Order, as required by section 18(j)(3)(C) of the Act, 12 U.S.C. § 1828(j)(3)(C), and section 308.69(b) of the FDIC Rules and Regulations, 12 C.F.R. 308.69(b). The Notice and Order, dated July 31, 1985, was served by certified mail upon each Respondent.
ALJ'S RECOMMENDED DECISION
The ALJ has recommended that the Board deny the motion to exclude as to Respondents * * * and * * * on the ground that allowing their participation in the hearing did not inconvenience the parties or delay the proceedings. As to Respondent * * *, the ALJ has recommended that the Board deem the Motion to Exclude as moot and has issued a Recommended Decision and Order as to Respondent * * *, under section 308.06(d) of the FDIC Rules and Regulations, 12 C.F.R. § 308.06(d), as a default judgment based on his failure to file an answer.
THE BOARD'S DECISION
[.2] Section 18(j)(3)(C), 12 U.S.C. § 1828(j)(3)(C), and section 308.69(b) of the FDIC Rules and Regulations, 12 C.F.R. § 308.69(b), requires that each respondent to an enforcement action submit a request in writing for a hearing to the Executive Secretary. The failure to request a hearing within the statutory time period results in the civil money penalty assessment being final and unappealable. 12 U.S.C. § 1828(j)(3)(C) and 12 C.F.R. § 308.70. The Board is of the opinion that Respondents * * *, * * * and * * * were each fully apprised of the requirements of the Act and the Rules and Regulations with respect to the filing of a written request for a hearing, including the applicable time limitation, by both the Notice and Order and the letter transmitting it. Respondent * * * was served with the Notice and Order on August 20, but failed to respond until November 6, when he asserted that he could not afford the time or expense of a hearing. Respondent * * * did not file a request for hearing until January 8, 1986. Neither Respondent offered a valid excuse or explana-
{{4-1-90 p.A-929}}tion for his failure to comply with the ten day time limitation for a request for hearing.*
3. The ALJ's Recommended Decision as to Respondent * * *
In view of the fact that the Board's decision that the Notice and Order are final and unappealable because of Respondent * * *'s failure to request a hearing within the statutory time limit, the ALJ's Recommended Decision and Ruling on Motion for Default Judgment are moot and it is unnecessary for the Board to consider them.
ORDER
For the reasons set forth above, it is hereby
FDIC-85-216K
FINDINGS OF FACT AND
1. * * * Bank, now doing business as * * * Bank (The Bank) was, at all times pertinent to this proceedings, a corporation existing and doing business under the laws of the State * * *, having its principal place of business in * * *. The Bank, at all times pertinent to this proceeding, was an insured State nonmember bank subject to the Federal Deposit Insurance Act (The Act) (12 U.S.C. §§ 1811-1831 d).
RECOMMENDED ORDER TO PAY
After taking into account the appropriateness of the penalty with respect to the financial resources and good faith of * * *; the gravity of the violations of this Respondent; and other such matters as justice may require, it is hereby ORDERED: that by reason of the transactions and violations set forth in paragraphs 2 through 11 above, a penalty of $2,500 be, and hereby is, assessed against * * *, pursuant to section 18(j) (3) of the Act (12 U.S.C. § 1828(j) (3)).
FDIC-85-216K
On February 4, 1986 Counsel for the F.D.I.C. filed the above motion, for failure to file an answer. Counsel cites 12 C.F.R. 308.12 and asks me to enter a Recommended Order of Default Judgment. They apparently ask for a recommended Order because 12 C.F.R. 308.07(b) (9) reads that an administrative law judge does not have the authority to rule on any motion resulting in a final determination of the merits of the proceedings. |
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Last Updated 6/6/2003 | legal@fdic.gov |