FDIC Law, Regulations, Related Acts

[Table of Contents] [Previous Page] [Next Page] [Search]

1000 - Federal Deposit Insurance Act

(j) Criminal penalty.--Whoever, being subject to an order in effect under subsection (e) or (g), without the prior written approval of the appropriate Federal financial institutions regulatory agency, knowingly participates, directly or indirectly, in any manner (including by engaging in an activity specifically prohibited in such an order or in subsection (e)(6)) in the conduct of the affairs of--

(1) any insured depository institution;

(2) any institution treated as an insured bank under subsection (b)(3) or (b)(4);

(3) any insured credit union (as defined in section 101(7) of the Federal Credit Union Act); or

(4) any institution chartered under the Farm Credit Act of 1971,

shall be fined not more than $1,000,000, imprisoned for not more than 5 years, or both.

(5) [Repealed]

[Codified to 12 U.S.C. 1818(j)]

[Source: Section 2[8(j)] of the Act of September 21, 1950 (Pub. L. No. 797), as added by section 202 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1052), effective October 16, 1966; as amended by section 111(a)(3) of title I of the Act of November 10, 1978 (Pub. L. No. 95--630; 92 Stat. 3667), effective March 10, 1979; section 427(d)(4) of title IV of the Act of October 15, 1982 (Pub. L. No. 97--320; 96 Stat. 1526), effective October 15, 1982; section 201(a)(1) of title II and sections 901(d) and 908(a) of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 187, 450, and 477, respectively), effective August 9, 1989; section 363(3)(E) of title III of the Act of July 21, 2010 (Pub. L. No. 111--203; 124 Stat. 1552), effective July 21, 2010 ]

(k) [Repealed]

[Codified to 12 U.S.C. 1818(k)]

[Source: Section 2[8(k)] of the Act of September 21, 1950 (Pub. L. No. 797), as added by section 202 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1052), effective October 16, 1966; and as amended by section 111(a)(4) of title I of the Act of November 10, 1978 (Pub. L. No. 95--630; 92 Stat. 3667), effective March 10, 1979; as removed by section 920(c) of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 488), effective August 9, 1989]

(l) Notice of Service.--Any service required or authorized to be made by the appropriate Federal banking agency under this section may be made by registered mail, or in such other manner reasonably calculated to give actual notice as the agency may by regulation or otherwise provide. Copies of any notice or order served by the agency upon any State depository institution or any institution-affiliated party, pursuant to the provisions of this section, shall also be sent to the appropriate State supervisory authority.

[Codified to 12 U.S.C. 1818(l)]

[Source: Section 2[8(l)] of the Act of September 21, 1950 (Pub. L. No. 797), as added by section 202 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1052), effective October 16, 1966, and as amended by section 901(b)(1)(I) and (d) of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 448 and 450), effective August 9, 1989]

(m) Notice to State Authorities.--In connection with any proceeding under subsection (b), (c)(1), or (e) of this section involving an insured State bank or any institution-affiliated party, the appropriate Federal banking agency shall provide the appropriate State supervisory authority with notice of the agency's intent to institute such a proceeding and the grounds therefor. Unless within such time as the Federal banking agency deems appropriate in the light of the circumstances of the case (which time must be specified in the notice prescribed in the preceding sentence) satisfactory corrective action is effectuated by action of the State supervisory authority, the agency may proceed as provided in this section. No bank or other party who is the subject of any notice or order issued by the agency under this section shall have standing to raise the requirements of this subsection as ground for attacking the validity of any such notice or order.

[Codified to 12 U.S.C. 1818(m)]

[Source: Section 2[8(m)] of the Act of September 21, 1950 (Pub. L. No. 797), as added by section 202 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1052), effective October 16, 1966, and as amended by section 901(b)(1)(J) of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 448), effective August 9, 1989]

(n) Ancillary Provisions; Subpoena Power, etc.--In the course of or in connection with any proceeding under this section, or in connection with any claim for insured deposits or any examination or investigation under section 10(c), the agency conducting the proceeding, examination, or investigation or considering the claim for insured deposits, or any member or designated representative thereof, including any person designated to conduct any hearing under this section, shall have the power to administer oaths and affirmations, to take or cause to be taken depositions, and to issue, revoke, quash, or modify subpoenas and subpoenas duces tecum; and such agency is empowered to make rules and regulations with respect to any such proceedings, claims, examinations, or investigations. The attendance of witnesses and the production of documents provided for in this subsection may be required from any place in any State or in any territory or other place subject to the jurisdiction of the United States at any designated place where such proceeding is being conducted. Any such agency or any party to proceedings under this section may apply to the United States District Court for the District of Columbia, or the United States district court for the judicial district or the United States court in any territory in which such proceeding is being conducted, or where the witness resides or carries on business, for enforcement of any subpoena or subpoena duces tecum issued pursuant to this subsection, and such courts shall have jurisdiction and power to order and require compliance therewith. Witnesses subpoenaed under this subsection shall be paid the same fees and mileage that are paid witnesses in the district courts of the United States. Any court having jurisdiction of any proceeding instituted under this section by an insured depository institution or a director or officer thereof, may allow to any such party such reasonable expenses and attorneys' fees as it deems just and proper; and such expenses and fees shall be paid by the depository institution or from its assets. Any person who willfully shall fail or refuse to attend and testify or to answer any lawful inquiry or to produce books, papers, correspondence, memoranda, contracts, agreements, or other records, if in such person's power so to do, in obedience to the subpoena of the appropriate Federal banking agency, shall be guilty of a misdemeanor and, upon conviction, shall be subject to a fine of not more than $1,000 or to imprisonment for a term of not more than one year or both.

[Codified to 12 U.S.C. 1818(n)]

[Source: Section 2[8(n)] of the Act of September 21, 1950 (Pub. L. No. 797), as added by section 202 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1052), effective October 16, 1966; and as amended by section 111(a)(5) of title I and section 303 of title III of the Act of November 10, 1978 (Pub. L. No. 95--630; 92 Stat. 3667 and 3676), effective March 10, 1979; and section 901(d) of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 450), effective August 9, 1989]

(o) Termination of Membership of State Bank in Federal Reserve System.--Whenever the insured status of a State member bank shall be terminated by action of the Board of Directors, the Board of Governors of the Federal Reserve System shall terminate its membership in the Federal Reserve System in accordance with the provisions of section 9 of the Federal Reserve Act, and whenever the insured status of a national member bank shall be so terminated the Comptroller of the Currency shall appoint a receiver for the bank, which shall be the Corporation. Except as provided in subsection (c) or (d) of section 4, whenever a member bank shall cease to be a member of the Federal Reserve System, its status as an insured depository institution shall, without notice or other action by the Board of Directors, terminate on the date the bank shall cease to be a member of the Federal Reserve System, with like effect as if its insured status had been terminated on said date by the Board of Directors after proceedings under subsection (a) of this section. Whenever the insured status of an insured Federal savings bank shall be terminated by action of the Board of Directors, the Comptroller of the Currency shall appoint a receiver for the bank, which shall be the Corporation.

[Codified to 12 U.S.C. 1818(o)]

[Source: Section 2[8(o), formerly 8(b)] of the Act of September 21, 1950 (Pub. L. No. 797; 64 Stat. 880), effective September 21, 1950; as redesignated by section 202 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1046), effective October 16, 1966; and as amended by section 113(h) of title I of the Act of October 15, 1982 (Pub. L. No. 97--320; 96 Stat. 1474), effective October 15, 1982; section 201(a)(1) and (b) of title II of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 187 and 188), effective August 9, 1989; section 602(a)(16) of title VI of the Act of September 23, 1994 (Pub. L. No. 103--325; 108 Stat. 2289), effective September 23, 1994; section 1232 of title XII of the Act of December 27, 2000 (Pub. L. No. 106--569; 114 Stat. 3037, effective December 27, 2000; section 363(3)(F) of title III of the Act of July 21, 2010 (Pub. L. No. 111--203; 124 Stat. 1552), effective July 21, 2010]

(p) Banks Not Receiving Deposits.--Notwithstanding any other provision of law, whenever the Board of Directors shall determine that an insured depository institution is not engaged in the business of receiving deposits, other than trust funds as herein defined, the Corporation shall notify the depository institution that its insured status will terminate at the expiration of the first full assessment period following such notice. A finding by the Board of Directors that a depository institution is not engaged in the business of receiving deposits, other than such trust funds, shall be conclusive. The Board of Directors shall prescribe the notice to be given by the depository institution of such termination and the Corporation may publish notice thereof. Upon the termination of the insured status of any such depository institution, its deposits shall thereupon cease to be insured and the depository institution shall thereafter be relieved of all future obligations to the Corporation, including the obligation to pay future assessments.

[Codified to 12 U.S.C. 1818(p)]

[Source: Section 2[8(p), formerly 8(c)] of the Act of September 21, 1950 (Pub. L. No. 797; 64 Stat. 880), effective September 21, 1950; as redesignated by section 202 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1046), effective October 16, 1966; section 602(a)(17) of title VI of the Act of September 23, 1994 (Pub. L. No. 103--325; 108 Stat. 2289), effective September 23, 1994; section 3(a)(6) of the Act of February 15, 2006 (Pub. L. No. 109--173; 119 Stat. 3605), effective date shall take effect on the date that the final regulations required under section 2109(a)(5) of the Federal Deposit Insurance Reform Act of 2005 take effect]

(q) Assumption of Liabilities.--Whenever the liabilities of an insured depository institution for deposits shall have been assumed by another insured depository institution or depository institutions, whether by way of merger, consolidation, or other statutory assumption, or pursuant to contract (1) the insured status of the depository institution whose liabilities are so assumed shall terminate on the date of receipt by the Corporation of satisfactory evidence of such assumption; (2) the separate insurance of all deposits so assumed shall terminate at the end of six months from the date such assumption takes effect or, in the case of any time deposit, the earliest maturity date after the six-month period. Where the deposits of an insured depository institution are assumed by a newly insured depository institution, the depository institution whose deposits are assumed shall not be required to pay any assessment with respect to the deposits which have been so assumed after the assessment period in which the assumption takes effect.

[Codified to 12 U.S.C. 1818(q)]

[Source: Section 2[8(q), formerly 8(d)] of the Act of September 21, 1950 (Pub. L. No. 797; 64 Stat. 881), effective September 21, 1950; as redesignated by section 202 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1046), effective October 16, 1966, and as amended by section 304 of title III of the Act of November 10, 1978 (Pub. L. No. 95--630; 92 Stat. 3676), effective March 10, 1979; section 433(a) of title IV of the Act of October 15, 1982 (Pub. L. No. 97--320; 96 Stat. 1527), effective October 15, 1982; section 201(a)(1) of title II and section 901(d) of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 187 and 450), effective August 9, 1989; section 302(e)(4) of title III of the Act of December 19, 1991 (Pub. L. No. 102--242; 105 Stat. 2349), effective December 19, 1991; section 3(a)(7) of the Act of February 15, 2006 (Pub. L. No. 109--173; 119 Stat. 3605), effective date shall take effect on the date that the final regulations required under section 2109(a)(5) of the Federal Deposit Insurance Reform Act of 2005 take effect]

(r) Action or Proceeding Against Foreign Bank; Basis; Removal of Officer or Other Person; Venue; Service of Process.--

(1) Except as otherwise specifically provided in this section, the provisions of this section shall be applied to foreign banks in accordance with this subsection.

(2) An act or practice outside the United States on the part of a foreign bank or any officer, director, employee, or agent thereof may not constitute the basis for any action by any officer or agency of the United States under this section, unless--

(A) such officer or agency alleges a belief that such act or practice has been, is, or is likely to be a cause of or carried on in connection with or in furtherance of an act or practice within any one or more States which, in and of itself, would constitute an appropriate basis for action by a Federal officer or agency under this section; or

(B) the alleged act or practice is one which, if proven, would, in the judgment of the Board of Directors, adversely affect the insurance risk assumed by the Corporation.

(3) In any case in which any action or proceeding is brought pursuant to an allegation under paragraph (2) of this subsection for the suspension or removal of any officer, director, or other person associated with a foreign bank, and such person fails to appear promptly as a party to such action or proceeding and to comply with any effective order or judgment therein, any failure by the foreign bank to secure his removal from any office he holds in such bank and from any further participation in its affairs shall, in and of itself, constitute grounds for termination of the insurance of the deposits in any branch of the bank.

(4) Where the venue of any judicial or administrative proceeding under this section is to be determined by reference to the location of the home office of a bank, the venue of such a proceeding with respect to a foreign bank having one or more branches or agencies in not more than one judicial district or other relevant jurisdiction shall be within such jurisdiction. Where such a bank has branches or agencies in more than one such jurisdiction, the venue shall be in the jurisdiction within which the branch or branches or agency or agencies involved in the proceeding are located, and if there is more than one such jurisdiction, the venue shall be proper in any such jurisdiction in which the proceeding is brought or to which it may appropriately be transferred.

(5) Any service required or authorized to be made on a foreign bank may be made on any branch or agency located within any State, but if such service is in connection with an action or proceeding involving one or more branches or one or more agencies located in any State, service shall be made on at least one branch or agency so involved.

[Codified to 12 U.S.C. 1818(r)]

[Source: Section 2[8(r)] of the Act of September 21, 1950 (Pub. L. No. 797), as added by section 6(c)(15) of the Act of September 17, 1978 (Pub. L. No. 95--369; 92 Stat. 618--619), effective September 17, 1978; section 602(a)(18) of title VI of the Act of September 23, 1994 (Pub. L. No. 103--325; 108 Stat. 2289), effective September 23, 1994]

(s) Compliance With Monetary Transaction Recordkeeping and Report Requirements.--

(1) COMPLIANCE PROCEDURES REQUIRED.--Each appropriate Federal banking agency shall prescribe regulations requiring insured depository institutions to establish and maintain procedures reasonably designed to assure and monitor the compliance of such depository institutions with the requirements of subchapter II of chapter 53 of title 31, United States Code.

(2) EXAMINATIONS OF DEPOSITORY INSTITUTIONS TO INCLUDE REVIEW OF COMPLIANCE PROCEDURES.--

(A) IN GENERAL.--Each examination of an insured depository institution by the appropriate Federal banking agency shall include a review of the procedures required to be established and maintained under paragraph (1).

(B) EXAM REPORT REQUIREMENT.--The report of examination shall describe any problem with the procedures maintained by the insured depository institution.

(3) ORDER TO COMPLY WITH REQUIREMENTS.--If the appropriate Federal banking agency determines that an insured depository institution--

(A) has failed to establish and maintain the procedures described in paragraph (1); or

(B) has failed to correct any problem with the procedures maintained by such depository institution which was previously reported to the depository institution by such agency,

the agency shall issue an order in the manner prescribed in subsection (b) or (c) requiring such depository institution to cease and desist from its violation of this subsection or regulations prescribed under this subsection.

[Codified to 12 U.S.C. 1818(s)]

[Source: Section 2[8(s)] of the Act of September 21, 1950 (Pub. L. No. 797), as added by section 1359(a)(1) of subtitle H of title I of the Act of October 27, 1986 (Pub. L. No. 99--570; 100 Stat. 3207--27), effective (January 27, 1987), and as amended by section 201(a)(1) of title II and section 901(d) of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 187 and 450), effective August 9, 1989]

(t) Authority of FDIC To Take Enforcement Action Against Insured Depository Institutions and Institution-Affiliated Parties.--

(1) RECOMMENDING ACTION BY APPROPRIATE FEDERAL BANKING AGENCY.--The Corporation, based on an examination of an insured depository institution by the Corporation or by the appropriate Federal banking agency or on other information, may recommend in writing to the appropriate Federal banking agency that the agency take any enforcement action authorized under section 7(j), this section, or section 18(j) with respect to any insured depository institution, any depository institution holding company, or any institution-affiliated party. The recommendation shall be accompanied by a written explanation of the concerns giving rise to the recommendation.

(2) FDIC'S AUTHORITY TO ACT IF APPROPRIATE FEDERAL BANKING AGENCY FAILS TO FOLLOW RECOMMENDATION.--If the appropriate Federal banking agency does not, before the end of the 60-day period beginning on the date on which the agency receives the recommendation under paragraph (1), take the enforcement action recommended by the Corporation or provide a plan acceptable to the Corporation for responding to the Corporation's concerns, the Corporation may take the recommended enforcement action if the Board of Directors determines, upon a vote of its members, that--

(A) the insured depository institution is in an unsafe or unsound condition;

(B) the institution or institution-affiliated party is engaging in unsafe or unsound practices, and the recommended enforcement action will prevent the institution or institution-affiliated party from continuing such practices;

(C) the conduct or threatened conduct (including any acts or omissions) poses a risk to the Deposit Insurance Fund, or may prejudice the interests of the institution's depositors or,

(D) the conduct or threatened conduct (including any acts or omissions) of the depository institution holding company poses a risk to the Deposit Insurance Fund, provided that such authority may not be used with respect to a depository institution holding company that is in generally sound condition and whose conduct does not pose a foreseeable and material risk of loss to the Deposit Insurance Fund;

(3) EFFECT OF EXIGENT CIRCUMSTANCES.--

(A) AUTHORITY TO ACT.--The Corporation may, upon a vote of the Board of Directors, and after notice to the appropriate Federal banking agency, exercise its authority under paragraph (2) in exigent circumstances without regard to the time period set forth in paragraph (2).

(B) AGREEMENT ON EXIGENT CIRCUMSTANCES.--The Corporation shall, by agreement with the appropriate Federal banking agency, set forth those exigent circumstances in which the Corporation may act under subparagraph (A).

(4) CORPORATION'S POWERS; INSTITUTION'S DUTIES.--For purposes of this subsection--

(A) the Corporation shall have the same powers with respect to any insured depository institution and its affiliates as the appropriate Federal banking agency has with respect to the institution and its affiliates; and

(B) the institution and its affiliates shall have the same duties and obligations with respect to the Corporation as the institution and its affiliates have with respect to the appropriate Federal banking agency.

(5) REQUESTS FOR FORMAL ACTIONS AND INVESTIGATIONS.--

(A) SUBMISSION OF REQUESTS.--A regional office of an appropriate Federal banking agency (including a Federal Reserve bank) that requests a formal investigation of or civil enforcement action against an insured depository institution or institution-affiliated party shall submit the request concurrently to the chief officer of the appropriate Federal banking agency and to the Corporation.

(B) AGENCIES REQUIRED TO REPORT ON REQUESTS.--Each appropriate Federal banking agency shall report semiannually to the Corporation on the status or disposition of all requests under subparagraph (A), including the reasons for any decision by the agency to approve or deny such requests.

(6) POWERS AND DUTIES WITH RESPECT TO DEPOSITORY INSTITUTION HOLDING COMPANIES.--For purposes of exercising the backup authority provided in this subsection--

(A) the Corporation shall have the same powers with respect to a depository institution holding company and its affiliates as the appropriate Federal banking agency has with respect to the holding company and its affiliates; and

(B) the holding company and its affiliates shall have the same duties and obligations with respect to the Corporation as the holding company and its affiliates have with respect to the appropriate Federal banking agency.

[Codified to 12 U.S.C. 1818(t)]

[Source: Section 2[18(t)] of the Act of September 21, 1950 (Pub. L. No. 797), effective September 21, 1950, as added by section 912 of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 482), effective August 9, 1989; as amended by section 307 of title III of the Act of December 19, 1991 (Pub. L. No. 102--242; 105 Stat. 2360), effective December 19, 1991; section 1605(a)(11) of title XVI of the Act of October 28, 1992 (Pub. L. No. 102--550; 106 Stat. 4086), effective October 28, 1992; section 8(a)(10) of the Act of February 15, 2006 (Pub. L. No. 109--173; 119 Stat. 3611), effective date shall take effect on the day of the merger of the Bank Insurance Fund pursuant to the Federal Deposit Insurance Reform Act of 2005; section 172(b) of title I of the Act of July 21, 2010 (Pub. L. No. 111--203; 124 Stat. 1439), and section 1090(1) of title X of the Act of July 21, 2010 (Pub.L. No. 111--203; 124 Stat. 2094), effective July 21, 2010]

(u) Public Disclosures of Final Orders and Agreements.--

(1) IN GENERAL.--The appropriate Federal banking agency shall publish and make available to the public on a monthly basis--

(A) any written agreement or other written statement for which a violation may be enforced by the appropriate Federal banking agency, unless the appropriate Federal banking agency, in its discretion, determines that publication would be contrary to the public interest;

(B) any final order issued with respect to any administrative enforcement proceeding initiated by such agency under this section or any other law; and

(2) HEARINGS.--All hearings on the record with respect to any notice of charges issued by a Federal banking agency shall be open to the public, unless the agency, in its discretion, determines that holding an open hearing would be contrary to the public interest.

(3) TRANSCRIPT OF HEARING.--A transcript that includes all testimony and other documentary evidence shall be prepared for all hearings commenced pursuant to subsection (i). A transcript of public hearings shall be made available to the public pursuant to section 552 of title 5, United States Code.

(4) DELAY OF PUBLICATION UNDER EXCEPTIONAL CIRCUMSTANCES.--If the appropriate Federal banking agency makes a determination in writing that the publication of a final order pursuant to paragraph (1)(B) would seriously threaten the safety and soundness of an insured depository institution, the agency may delay the publication of the document for a reasonable time.

(5) DOCUMENTS FILED UNDER SEAL IN PUBLIC ENFORCEMENT HEARINGS.--The appropriate Federal banking agency may file any document or part of a document under seal in any administrative enforcement hearing commenced by the agency if disclosure of the document would be contrary to the public interest. A written report shall be made part of any determination to withhold any part of a document from the transcript of the hearing required by paragraph (2).

(6) RETENTION OF DOCUMENTS.--Each Federal banking agency shall keep and maintain a record, for a period of at least 6 years, of all documents described in paragraph (1) and all informal enforcement agreements and other supervisory actions and supporting documents issued with respect to or in connection with any administrative enforcement proceeding initiated by such agency under this section or any other laws.

(7) DISCLOSURES TO CONGRESS.--No provision of this subsection may be construed to authorize the withholding, or to prohibit the disclosure, of any information to the Congress or any committee or subcommittee of the Congress.

[Codified to 12 U.S.C. 1818(u)]

[Source: Section 2[18(u)] of the Act of September 21, 1950 (Pub. L. No. 797), effective September 21, 1950, as added by section 913 of title IX of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 483), effective August 9, 1989; amended by section 2547(a)(1) of title XXV of the Act of November 29, 1990 (Pub. L. No. 101--647; 104 Stat. 4886), effective November 29, 1990; section 1001(d) of title X of the Act of November 10, 1998 (Pub. L. No. 105--362; 112 Stat. 3291), effective November 10, 1998]

(v) Foreign Investigations.--

(1) REQUESTING ASSISTANCE FROM FOREIGN BANKING AUTHORITIES.--In conducting any investigation, examination, or enforcement action under this Act, the appropriate Federal banking agency may--

(A) request the assistance of any foreign banking authority; and

(B) maintain an office outside the United States.

(2) PROVIDING ASSISTANCE TO FOREIGN BANKING AUTHORITIES.--

(A) IN GENERAL.--Any appropriate Federal banking agency may, at the request of any foreign banking authority, assist such authority if such authority states that the requesting authority is conducting an investigation to determine whether any person has violated, is violating, or is about to violate any law or regulation relating to banking matters or currency transactions administered or enforced by the requesting authority.

(B) INVESTIGATION BY FEDERAL BANKING AGENCY.--Any appropriate Federal banking agency may, in such agency's discretion, investigate and collect information and evidence pertinent to a request for assistance under subparagraph (A). Any such investigation shall comply with the laws of the United States and the policies and procedures of the appropriate Federal banking agency.

(C) FACTORS TO CONSIDER.--In deciding whether to provide assistance under this paragraph, the appropriate Federal banking agency shall consider--

(i) whether the requesting authority has agreed to provide reciprocal assistance with respect to banking matters within the jurisdiction of any appropriate Federal banking agency; and

(ii) whether compliance with the request would prejudice the public interest of the United States.

(D) TREATMENT OF FOREIGN BANKING AUTHORITY.--For purposes of any Federal law or appropriate Federal banking agency regulation relating to the collection or transfer of information by any appropriate Federal banking agency, the foreign banking authority shall be treated as another appropriate Federal banking agency.

(3) RULE OF CONSTRUCTION.--Paragraphs (1) and (2) shall not be construed to limit the authority of an appropriate Federal banking agency or any other Federal agency to provide or receive assistance or information to or from any other foreign authority with respect to any matter.

[Codified to 12 U.S.C. 1818(v)]

[Source: Section 2[18(v)] of the Act of September 1, 1950 (Pub. L. No. 797), effective September 21, 1950, as added by section 2532(a) of title XXV of the Act of November 29, 1990 (Pub. L. No. 101--647; 104 Stat. 4880), effective November 29, 1990]

(w) Termination of Insurance for Money Laundering or Cash Transaction Reporting Offenses.--

(1) IN GENERAL.--

(A) CONVICTION OF TITLE 18 OFFENSES.--

(i) DUTY TO NOTIFY.--If an insured State depository institution has been convicted of any criminal offense under section 1956 or 1957 of title 18, United States Code, the Attorney General shall provide to the Corporation a written notification of the conviction and shall include a certified copy of the order of conviction from the court rendering the decision.

(ii) NOTICE OF TERMINATION; PRETERMINATION HEARING.--After receipt of written notification from the Attorney General by the Corporation of such a conviction, the Board of Directors shall issue to the insured depository institution a notice of its intention to terminate the insured status of the insured depository institution and schedule a hearing on the matter, which shall be conducted in all respects as a termination hearing pursuant to paragraphs (3) through (5) of subsection (a).

(B) CONVICTION OF TITLE 31 OFFENSES.--If an insured State depository institution is convicted of any criminal offense under section 5322 or 5324 of title 31, United States Code, after receipt of written notification from the Attorney General by the Corporation, the Board of Directors may initiate proceedings to terminate the insured status of the insured depository institution in the manner described in subparagraph (A).

(C) NOTICE TO STATE SUPERVISOR.--The Corporation shall simultaneously transmit a copy of any notice issued under this paragraph to the appropriate State financial institutions supervisor.

(2) FACTORS TO BE CONSIDERED.--In determining whether to terminate insurance under paragraph (1), the Board of Directors shall take into account the following factors:

(A) The extent to which directors or senior executive officers of the depository institution knew of, or were involved in, the commission of the money laundering offense of which the institution was found guilty.

(B) The extent to which the offense occurred despite the existence of policies and procedures within the depository institution which were designed to prevent the occurrence of any such offense.

(C) The extent to which the depository institution has fully cooperated with law enforcement authorities with respect to the investigation of the money laundering offense of which the institution was found guilty.

(D) The extent to which the depository institution has implemented additional internal controls (since the commission of the offense of which the depository institution was found guilty) to prevent the occurrence of any other money laundering offense.

(E) The extent to which the interest of the local community in having adequate deposit and credit services available would be threatened by the termination of insurance.

(3) NOTICE TO STATE BANKING SUPERVISOR AND PUBLIC.--When the order to terminate insured status initiated pursuant to this subsection is final, the Board of Directors shall--

(A) notify the State banking supervisor of any State depository institution described in paragraph (1), where appropriate, at least 10 days prior to the effective date of the order of termination of the insured status of such depository institution, including a State branch of a foreign bank; and

(B) publish notice of the termination of the insured status of the depository institution in the Federal Register.

(4) TEMPORARY INSURANCE OF PREVIOUSLY INSURED DEPOSITS.--Upon termination of the insured status of any State depository institution pursuant to paragraph (1), the deposits of such depository institution shall be treated in accordance with subsection (a)(7).

(5) SUCCESSOR LIABILITY.--This subsection shall not apply to a successor to the interests of, or a person who acquires an insured depository institution that violated a provision of law described in paragraph (1), if the successor succeeds to the interests of the violator, or the acquisition is made, in good faith and not for purposes of evading this subsection or regulations prescribed under this subsection.

(6) "SENIOR EXECUTIVE OFFICER" DEFINED.--The term "senior executive officer" has the same meaning as in regulations prescribed under section 32(f) of this Act.

[Codified to 12 U.S.C. 1818(w)]

[Source: Section 2[18(w)] of the Act of September 21, 1950 (Pub. L. No. 797), effective September 21, 1950, as added by section 1503(a)(1) of title XV of the Act of October 28, 1992 (Pub. L. No. 102--550; 106 Stat. 4048), effective October 28, 1992; section 411(c)(2)(A) of title IV of the Act of September 23, 1994 (Pub. L. No. 103--325; 108 Stat. 2253), effective September 23, 1994; section 363(3)(G) of title III of the Act of July 21, 2010 (Pub. L. No. 111--203; 124 Stat. 1552), effective July 21, 2010]

NOTES

Derivation. Sections 8(a), 8(o) [formerly 8(b)], and 8(q) [formerly 8(d)] derive from sections 12B(i)(1), 12B(i)(2), and 12B(i)(4), respectively, of the Federal Reserve Act, as added by section 101[12B(i)(1), 12B(i)(2), and 12B(i)(4)] of title I of the Act of August 23, 1935 (Pub. L. No. 305; 49 Stat. 690), effective August 23, 1935. Section 12B(i)(2) of the Federal Reserve Act was amended by section 7 of the Act of August 17, 1950 (Pub. L. No. 706; 64 Stat. 458), effective August 17, 1950. By section 1 of the Act of September 21, 1950 (Pub. L. No. 797; 64 Stat. 873), effective September 21, 1950, section 12B of the Federal Reserve Act was withdrawn as a part of that Act and was made a separate act known as the "Federal Deposit Insurance Act."

Section 8(p) [formerly 8(c)] was enacted by section 2[8(p), formerly 8(c)] of the Act of September 21, 1950 (Pub. L. No. 797; 64 Stat. 880), effective September 21, 1950.

Sections 8(b)--(n) were added by section 202 of title II of the Act of October 16, 1966 (Pub. L. No. 89--695; 80 Stat. 1046), effective October 16, 1966. They were originally effective only during the period ending at the close of June 30, 1972. They were made "permanent" law by section 908 of title IX of the Act of December 31, 1970 (Pub. L. No. 91--609; 84 Stat. 1811), effective December 31, 1970.

Section 8(r) was added by section 6(c)(15) of the Act of September 17, 1978 (Pub. L. No. 95--369; 92 Stat. 618), effective September 17, 1978.

Section 8(s) derives from section 1359(a)(10 of the Act of October 27, 1986 (Pub. L. No. 99--570; 100 Stat. 3207), effective January 27, 1987.

Sections 8(t) and 8(u) were enacted by sections 912 and 913 of the Act of August 9, 1989 (Pub. L. No. 101--73; 103 Stat. 482 and 483, respectively), effective August 9, 1989.

Implementing regulations. FDIC regulations regarding notification of changes of insured status are entitled "Part 307--Notification of Changes of Insured Status." Regulations regarding involuntary termination of insured status, cease-and-desist, and suspension or removal proceedings are entitled "Part 308--Rules of Practice and Procedures." Both parts appear under the "FDIC Rules and Regulations" tabcard.

[Table of Contents] [Previous Page] [Next Page] [Search]

About

Resources

Analysis

News

FDIC Law, Regulations, Related Acts

1000 - Federal Deposit Insurance Act

Contact the FDIC

Stay Informed

How Can We Help You?