InfoBytes Blog
FDIC releases May enforcement actions
On June 24, the FDIC released a list of 14 public enforcement actions taken against banks and individuals in May. These orders consist of “two consent orders, one modification of an 8(e) prohibition order, three orders to pay civil money penalty, three orders of prohibition, two section 19 orders, and one order of prohibition from further participation and order to pay, one order terminating amended supervisory prompt corrective action directive, and one order of termination of insurance.” Included is an order to pay a civil money penalty imposed against a Texas-based bank related to alleged violations of the Flood Disaster Protection Act. Among other things, the FDIC claimed that the bank failed “to obtain flood insurance or obtain an adequate amount of insurance coverage, at or before loan origination, for all structures in a flood zone, including multiple structures,” and failed “to force-place flood insurance, after loan origination, when the insurance on buildings securing the loan” was insufficient or nonexistent. The order assessed a $2,000 civil money penalty.
The FDIC also issued a consent order against a Utah-based bank based on alleged unsafe or unsound banking practices relating to the Bank Secrecy Act. The bank neither admitted nor denied the alleged violations but agreed to, among other things, “increase its oversight of the Bank's compliance with the BSA” and “conduct a comprehensive assessment of BSA/AML staffing needs.”