FDIC releases April enforcement actions

Federal Issues FDIC Enforcement Flood Insurance Flood Disaster Protection Act Mortgages Bank Regulatory

On May 28, the FDIC released a list of administrative enforcement actions taken against banks and individuals in April. During the month, the FDIC issued 10 orders consisting of “two Orders to Pay Civil Money Penalties, one Section 19 Application, one Order Terminating Consent Order, and one Order of Prohibition from Further Participation.” Among the orders is a civil money penalty imposed against a Washington-based bank related to alleged violations of the Flood Disaster Protection Act (FDPA) for “failing to obtain adequate flood insurance on buildings and/or the buildings’ contents securing designated loans at the time the Bank made, increased, extended, or renewed the loans.” The order requires the payment of a $17,000 civil money penalty.

The FDIC also imposed a civil money penalty against a California-based bank related to alleged violations of the FDPA. Among other things, the FDIC claims that the bank (i) failed to notify the borrower to obtain flood insurance; and (ii) failed to purchase flood insurance on the borrower’s behalf. The order requires the payment of a $281,000 civil money penalty.