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Financial Services Law Insights and Observations

FDIC releases October enforcement actions

Bank Regulatory Federal Issues Financial Crimes FDIC Enforcement Flood Disaster Protection Act Mortgages Anti-Money Laundering Combating the Financing of Terrorism Bank Secrecy Act

On November 25, the FDIC released a list of administrative enforcement actions taken against banks and individuals in October. During the month, the FDIC made public ten orders consisting of “one consent order; one amended and restated consent order; one personal cease and desist order; three orders to pay civil money penalties; two Section 19 orders; and two orders terminating consent orders.” Among the orders is an order to pay a civil money penalty imposed against a Mississippi-based bank related to 128 alleged violations of the Flood Disaster Protection Act. Among other things, the FDIC claimed that the bank failed to obtain the required flood insurance or obtain an adequate amount of insurance coverage, at or before loan origination, for all structures in a flood zone. The order requires the payment of a $320,500 civil money penalty.

The FDIC also issued a consent order to a New York-based bank, which alleged that the bank had unsafe or unsound banking practices relating to weaknesses in the Bank’s Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) Program. The bank neither admitted nor denied the alleged violations but agreed to, among other things, increase its supervision, direction, and oversight of AML/CFT personnel and its AML/CFT program.