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United States Code (Last Updated: May 24, 2014) |
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Title 12. BANKS AND BANKING |
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Chapter 14. FEDERAL CREDIT UNIONS |
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SubChapter II. SHARE INSURANCE |
§ 1786. Termination of insured credit union status; cease and desist orders; removal or suspension from office; procedure
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(a) Termination of insurance (1) Any insured credit union other than a Federal credit union may, upon not less than ninety days’ written notice to the Board and upon the affirmative vote of a majority of its members within one year prior to the giving of such notice, terminate its status as an insured credit union. (2) Any insured credit union, other than a Federal credit union, which has obtained a new certificate of insurance from a corporation authorized and duly licensed to insure member accounts may upon not less than ninety days’ written notice to the Board convert from status as an insured credit union under this chapter: Provided, That at the time of giving notice to the Board the provisions of paragraph (b)(1) of this section are not being invoked against the credit union. (b) Unsound condition of credit union; notice to correct condition; hearing; judicial review (1) Whenever, in the opinion of the Board, any insured credit union is engaging or has engaged in unsafe or unsound practices in conducting the business of such credit union, or is in an unsafe or unsound condition to continue operations as an insured credit union, or is violating or has violated an applicable law, rule, regulation, order, or any condition imposed in writing by the Board in connection with any action on any application, notice, or other request by the credit union or institution-affiliated party,, exceed $1,000,000; and (ii) in the case of any insured credit union, an amount not to exceed the lesser of— (I) $1,000,000; or (II) 1 percent of the total assets of such credit union. (E) Assessment.— (i) Written notice.— Any penalty imposed under subparagraph (A), (B), or (C) may be assessed and collected by the Board by written notice. (ii) Finality of assessment.— If, with respect to any assessment under clause (i), a hearing is not requested pursuant to subparagraph (H) within the period of time allowed under such subparagraph, the assessment shall constitute a final and unappealable order. (F) Authority to modify or remit penalty.— The Board may compromise, modify, or remit any penalty which such agency may assess or had already assessed under subparagraph (A), (B), or (C). (G) Mitigating factors.— In determining the amount of any penalty imposed under subparagraph (A), (B), or (C), the Board shall take into account the appropriateness of the penalty with respect to— (i) the size of financial resources and good faith of the insured credit union or the person charged; (ii) the gravity of the violation; (iii) the history of previous violations; and (iv) such other matters as justice may require. (H) Hearing.— The insured credit union or other person against whom any penalty is assessed under this paragraph shall be afforded an agency hearing if such institution or person submits a request for such hearing within 20 days after the issuance of the notice of assessment. (I) Collection.— (i) Referral.— If any insured credit union or other person fails to pay an assessment after any penalty assessed under this paragraph has become final, the Board shall recover the amount assessed by action in the appropriate United States district court. (ii) Appropriateness of penalty not reviewable.— In any civil action under clause (i), the validity and appropriateness of the penalty shall not be subject to review. (J) Disbursement.— All penalties collected under authority of this paragraph shall be deposited into the Treasury. (K) “Violate” defined.— For purposes of this section, the term “violate” includes any action (alone or with another or others) for or toward causing, bringing about, participating in, counseling, or aiding or abetting a violation. (L) Regulations.— The Board shall prescribe regulations establishing such procedures as may be necessary to carry out this paragraph. (3) Notice under this section after separation from service.— The resignation, termination of employment or participation, or separation of a institution-affiliated party (including a separation caused by the closing of an insured credit union) shall not affect the jurisdiction and authority of the Board to issue any notice or order and proceed under this section against any such party, if such notice or order is served before the end of the 6-year period beginning on the date such party ceased to be such a party with respect to such credit union (whether such date occurs before, on, or after August 9, 1989 ).(l) Criminal penalty for violation of certain orders Whoever— (1) under this chapter, is suspended or removed from, or prohibited from participating in the affairs of any credit union described in subsection (g)(5) of this section; and (2) knowingly participates, directly or indirectly, in any manner (including by engaging in an activity specifically prohibited in such an order or in subsection (g)(5) of this section) in the conduct of the affairs of such a credit union; shall be fined not more than $1,000,000, imprisoned for not more than 5 years, or both. (m) Definitions As used in this section (1) the terms “cease-and-desist order which has become final” and “order which has become final” means a cease-and-desist order, or an order issued by the Board with the consent of the credit union or the director, officer, committee member, or other person concerned, or with respect to which no petition for review of the action of the Board has been filed and perfected in a court of appeals as specified in paragraph (2) of subsection (j) of this section, or with respect to which the action of the court in which said petition is so filed is not subject to further review by the Supreme Court of the United States in proceedings provided for in said paragraph, or an order issued under subsection (i) of this section, and (2) the term “violation” includes, without limitation any action (alone or with another or others) for or toward causing, bringing about, participating in, counseling, or aiding or abetting a violation.
(n) Notice or order to State board supervising State-chartered credit union Any service required or authorized to be made by the Board under this section may be made by registered mail or in such other manner reasonably calculated to give actual notice as the Board may by regulation or otherwise provide. Copies of any notice or order served by the Board upon any State-chartered credit union or any director, officer, or committee member thereof or other person participating in the conduct of its affairs, pursuant to the provisions of this section, shall also be sent to the commission, board, or authority, if any, having supervision of such credit union.
(o) Notice of proceedings to State board supervising State-chartered credit union; effect of corrective action by State board; attack on validity of notice or order In connection with any proceeding under subsection (e), (f)(1), or (g) of this section involving an insured State-chartered credit union or any institution-affiliated party, the Board shall provide the commission, board, or authority, if any, having supervision of such credit union, with notice of its intent to institute such a proceeding and the grounds thereof. Unless within such time as the Board 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 such commission, board, or authority, the Board may proceed as provided in this section. No credit union or other party who is the subject of any notice or order issued by the Board 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.
(p) Proceedings; powers of Board; court enforcement of subpenas; witness fees; expenses and attorneys’ fees 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 1784(b) of this title, the Board, in conducting the proceeding, examination, or investigation or considering the claim for insured deposits,,1 or any 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 subpenas and subpenas duces tecum, and the Board 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 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 subpena or subpena duces tecum issued pursuant to this subsection, and such courts shall have jurisdiction and power to order and require compliance therewith. Witnesses subpenaed under this section 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 proceedings instituted under this section by an insured credit union or a director, officer, or committee member 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 credit union or from its assets.
(q) Compliance with monetary transaction recordkeeping and report requirements (1) Compliance procedures required The Board shall prescribe regulations requiring insured credit unions to establish and maintain procedures reasonably designed to assure and monitor the compliance of such credit unions with the requirements of subchapter II of chapter 53 of title 31.
(2) Examinations of credit unions to include review of compliance procedures (A) In general Each examination of an insured credit union by the Board 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 credit union.
(3) Order to comply with requirements If the Board determines that an insured credit union— (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 credit union which was previously reported to the credit union by the Board, the Board shall issue an order in the manner prescribed in subsection (e) or (f) of this section requiring such credit union to cease and desist from its violation of this subsection or regulations prescribed under this subsection. (r) “Institution-affiliated party” defined For purposes of this chapter, the term “institution-affiliated party” means— (1) any committee member, director, officer, or employee of, or agent for, an insured credit union; (2) any consultant, joint venture partner, and any other person as determined by the Board (by regulation or on a case-by-case basis) who participates in the conduct of the affairs of an insured credit union; and (3) any independent contractor (including any attorney, appraiser, or accountant) who knowingly or recklessly participates in— (A) any violation of any law or regulation; (B) any breach of fiduciary duty; or (C) any unsafe or unsound practice, which caused or is likely to cause more than a minimal financial loss to, or a significant adverse effect on, the insured credit union. (s) Public disclosure of agency action (1) In general The Board 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 Board, unless the Board, 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 the Board under this section or any other law; and (C) any modification to or termination of any order or agreement made public pursuant to this paragraph. (2) Hearings All hearings on the record with respect to any notice of charges issued by the Board 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) Reports to Congress A written report shall be made part of a determination not to hold a public hearing pursuant to paragraph (2) or not to publish a document pursuant to paragraph (1)(A). At the end of each calendar quarter, all such reports shall be transmitted to the Congress.
(4) Transcript of hearing A transcript that includes all testimony and other documentary evidence shall be prepared for all hearings commenced pursuant to subsection (k) of this section. A transcript of public hearings shall be made available to the public pursuant to section 552 of title 5.
(5) Delay of publication under exceptional circumstances If the Board 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.
(6) Documents filed under seal in public enforcement hearings The Board 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).
(7) Retention of documents The Board 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.
(8) 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.
(9) Preservation of records (A) In general The Board may cause any and all records, papers, or documents kept by the Administration or in the possession or custody of the Administration to be— (i) photographed or microphotographed or otherwise reproduced upon film; or (ii) preserved in any electronic medium or format which is capable of— (I) being read or scanned by computer; and (II) being reproduced from such electronic medium or format by printing or any other form of reproduction of electronically stored data. (B) Treatment as original records Any photographs, micrographs, or photographic film or copies thereof described in subparagraph (A)(i) or reproduction of electronically stored data described in subparagraph (A)(ii) shall be deemed to be an original record for all purposes, including introduction in evidence in all State and Federal courts or administrative agencies, and shall be admissible to prove any act, transaction, occurrence, or event therein recorded.
(C) Authority of the administration Any photographs, microphotographs, or photographic film or copies thereof described in subparagraph (A)(i) or reproduction of electronically stored data described in subparagraph (A)(ii) shall be preserved in such manner as the Administration shall prescribe, and the original records, papers, or documents may be destroyed or otherwise disposed of as the Administration may direct.
(t) Regulation of certain forms of benefits to institution-affiliated parties (1) Golden parachutes and indemnification payments The Board may prohibit or limit, by regulation or order, any golden parachute payment or indemnification payment.
(2) Factors to be taken into account The Board shall prescribe, by regulation, the factors to be considered by the Board in taking any action pursuant to paragraph (1) which may include such factors as the following: (A) Whether there is a reasonable basis to believe that the institution-affiliated party has committed any fraudulent act or omission, breach of trust or fiduciary duty, or insider abuse with regard to the credit union that has had a material affect on the financial condition of the credit union. (B) Whether there is a reasonable basis to believe that the institution-affiliated party is substantially responsible for the insolvency of the credit union, the appointment of a conservator or liquidating agent for the credit union, or the credit union’s troubled condition (as defined in regulations prescribed by the Board pursuant to paragraph (4)(A)(ii)(III)). (C) Whether there is a reasonable basis to believe that the institution-affiliated party has materially violated any applicable Federal or State banking law or regulation that has had a material effect on the financial condition of the credit union. (D) Whether there is a reasonable basis to believe that the institution-affiliated party has violated or conspired to violate— (i) section 215, 656, 657, 1005, 1006, 1007, 1014, 1032, or 1344 of title 18; or (ii) section 1341 or 1343 of such title affecting a financial institution. (E) Whether the institution-affiliated party was in a position of managerial or fiduciary responsibility. (F) The length of time the party was affiliated with the credit union and the degree to which— (i) the payment reasonably reflects compensation earned over the period of employment; and (ii) the compensation involved represents a reasonable payment for services rendered. (3) Certain payments prohibited No credit union may prepay the salary or any liability or legal expense of any institution-affiliated party if such payment is made— (A) in contemplation of the insolvency of such credit union or after the commission of an act of insolvency; and (B) with a view to, or has the result of— (i) preventing the proper application of the assets of the credit union; or (ii) preferring one creditor over another. (4) “Golden parachute payment” defined For purposes of this subsection— (A) In general The term “golden parachute payment” means any payment (or any agreement to make any payment) in the nature of compensation by any credit union for the benefit of any institution-affiliated party pursuant to an obligation of such credit union that— (i) is contingent on the termination of such party’s affiliation with the credit union; and (ii) is received on or after the date on which— (I) the credit union is insolvent; (II) any conservator or liquidating agent is appointed for such credit union; (III) the Board determines that the credit union is in a troubled condition (as defined in regulations which the Board shall prescribe); (IV) the credit union has been assigned a composite rating by the Board of 4 or 5 under the Uniform Financial Institutions Rating System (as applicable with respect to credit unions); or (V) the credit union is subject to a proceeding initiated by the Board to terminate or suspend deposit insurance for such credit union. (B) Certain payments in contemplation of an event Any payment which would be a golden parachute payment but for the fact that such payment was made before the date referred to in subparagraph (A)(ii) shall be treated as a golden parachute payment if the payment was made in contemplation of the occurrence of an event described in any subclause of such subparagraph.
(C) Certain payments not included The term “golden parachute payment” shall not include— (i) any payment made pursuant to a retirement plan which is qualified (or is intended to be qualified) under section 401 of title 26 or other nondiscriminatory retirement or severance benefit plan; (ii) any payment made pursuant to a bona fide deferred compensation plan or arrangement which the Board determines, by regulation or order, to be permissible; or (iii) any payment made by reason of the death or disability of an institution-affiliated party. (5) Other definitions For purposes of this subsection— (A) Indemnification payment Subject to paragraph (6), the term “indemnification payment” means any payment (or any agreement to make any payment) by any credit union for the benefit of any person who is or was an institution-affiliated party, to pay or reimburse such person for any liability or legal expense with regard to any administrative proceeding or civil action instituted by the Board which results in a final order under which such person— (i) is assessed a civil money penalty; (ii) is removed or prohibited from participating in conduct of the affairs of the credit union; or (iii) is required to take any affirmative action described in subsection (e)(3) of this section with respect to such credit union. (B) Liability or legal expense The term “liability or legal expense” means— (i) any legal or other professional expense incurred in connection with any claim, proceeding, or action; (ii) the amount of, and any cost incurred in connection with, any settlement of any claim, proceeding, or action; and (iii) the amount of, and any cost incurred in connection with, any judgment or penalty imposed with respect to any claim, proceeding, or action. (C) Payment The term “payment” includes— (i) any direct or indirect transfer of any funds or any asset; and (ii) any segregation of any funds or assets for the purpose of making, or pursuant to an agreement to make, any payment after the date on which such funds or assets are segregated, without regard to whether the obligation to make such payment is contingent on— (I) the determination, after such date, of the liability for the payment of such amount; or (II) the liquidation, after such date, of the amount of such payment. (6) Certain commercial insurance coverage not treated as covered benefit payment No provision of this subsection shall be construed as prohibiting any credit union from purchasing any commercial insurance policy or fidelity bond, except that, subject to any requirement described in paragraph (5)(A)(iii), such insurance policy or bond shall not cover any legal or liability expense of the credit union which is described in paragraph (5)(A).
(u) Foreign investigations (1) Requesting assistance from foreign banking authorities In conducting any investigation, examination, or enforcement action under this chapter, the Board 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 The Board 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 The Board may, in the Board’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 Board.
(C) Factors to consider In deciding whether to provide assistance under this paragraph, the Board shall consider— (i) whether the requesting authority has agreed to provide reciprocal assistance with respect to banking matters within the jurisdiction of the Board or 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 Board regulation relating to the collection or transfer of information by the Board or 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 the Board or any other Federal agency to provide or receive assistance or information to or from any foreign authority with respect to any matter.
(v) 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 credit union has been convicted of any criminal offense under section 1956 or 1957 of title 18, the Attorney General shall provide to the Board 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 After written notification from the Attorney General to the Board of such a conviction, the Board shall issue to such insured credit union a notice of its intention to terminate the insured status of the insured credit union and schedule a hearing on the matter, which shall be conducted as a termination hearing pursuant to subsection (b) of this section, except that no period for correction shall apply to a notice issued under this subparagraph.
(B) Conviction of title 31 offenses If a credit union is convicted of any criminal offense under section 5322 or 5324 of title 31 after prior written notification from the Attorney General, the Board may initiate proceedings to terminate the insured status of such credit union in the manner described in subparagraph (A).
(C) Notice to State supervisor The Board shall simultaneously transmit a copy of any notice 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 shall take into account the following factors: (A) The extent to which directors, committee members, or senior executive officers (as defined by the Board in regulations which the Board shall prescribe) of the credit union knew of, or were involved in, the commission of the money laundering offense of which the credit union was found guilty. (B) The extent to which the offense occurred despite the existence of policies and procedures within the credit union which were designed to prevent the occurrence of any such offense. (C) The extent to which the credit union has fully cooperated with law enforcement authorities with respect to the investigation of the money laundering offense of which the credit union was found guilty. (D) The extent to which the credit union has implemented additional internal controls (since the commission of the offense of which the credit union 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 credit union supervisor and public When the order to terminate insured status initiated pursuant to this subsection is final, the Board shall— (A) notify the commission, board, or authority (if any) having supervision of the credit union described in paragraph (1) at least 10 days prior to the effective date of the order of the termination of the insured status of such credit union; and (B) publish notice of the termination of the insured status of the credit union. (4) Temporary insurance of previously insured deposits Upon termination of the insured status of any State credit union pursuant to paragraph (1), the deposits of such credit union shall be treated in accordance with subsection (d)(2) of this section.
(5) Successor liability This subsection shall not apply to a successor to the interests of, or a person who acquires, an insured credit union 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.
(w) One-year restrictions on Federal examiners of insured credit unions (1) In general In addition to other applicable restrictions set forth in title 18, the penalties set forth in paragraph (5) of this subsection shall apply to any person who— (A) was an officer or employee (including any special Government employee) of the Administration; (B) served 2 or more months during the final 12 months of his or her employment with the Administration as the senior examiner (or a functionally equivalent position) of an insured credit union with continuing, broad responsibility for the examination (or inspection) of that insured credit union on behalf of the Administration; and (C) within 1 year after the termination date of his or her service or employment with the Administration, knowingly accepts compensation as an employee, officer, director, or consultant from such insured credit union. (2) Rule of construction For purposes of this subsection, a person shall be deemed to act as a consultant for an insured credit union only if such person directly works on matters for, or on behalf of, such insured credit union.
(3) Regulations (A) In general The Board shall prescribe rules or regulations to administer and carry out this subsection, including rules, regulations, or guidelines to define the scope of persons referred to in paragraph (1)(B).
(B) Consultation In prescribing rules or regulations under this paragraph, the Board shall, to the extent it deems necessary, consult with the Federal banking agencies (as defined in section 1813 of this title) on regulations issued by such agencies in carrying out section 1820(k) of this title.
(4) Waiver The Board may grant a waiver, on a case by case basis, of the restriction imposed by this subsection to any officer or employee (including any special Government employee) of the Administration if the Chairman certifies in writing that granting the waiver would not affect the integrity of the supervisory program of the Administration.
(5) Penalties (A) In general In addition to any other administrative, civil, or criminal remedy or penalty that may otherwise apply, whenever the Board determines that a person subject to paragraph (1) has become associated, in the manner described in paragraph (1)(C), with an insured credit union, the Board shall impose upon such person one or more of the following penalties: (i) Industry-wide prohibition order The Board shall serve a written notice or order in accordance with and subject to the provisions of subsection (g)(4) of this section for written notices or orders under paragraph (1) or (2) of subsection (g) of this section, upon such person of the intention of the Board— (I) to remove such person from office or to prohibit such person from further participation in the conduct of the affairs of the insured credit union for a period of up to 5 years; and (II) to prohibit any further participation by such person, in any manner, in the conduct of the affairs of any insured credit union for a period of up to 5 years. (ii) Civil monetary penalty The Board may, in an administrative proceeding or civil action in an appropriate United States district court, impose on such person a civil monetary penalty of not more than $250,000. Any administrative proceeding under this clause shall be conducted in accordance with subsection (k) of this section. In lieu of an action by the Board under this clause, the Attorney General of the United States may bring a civil action under this clause in the appropriate United States district court.
(B) Scope of prohibition order Any person subject to an order issued under this subparagraph (A)(i) shall be subject to paragraphs (5) and (7) of subsection (g) of this section in the same manner and to the same extent as a person subject to an order issued under subsection (g) of this section.
References In Text
The Depository Institution Management Interlocks Act, referred to in subsec. (g)(2)(A)(iii), is title II of Pub. L. 95–630,
The Farm Credit Act of 1971, referred to in subsec. (g)(7)(A)(iv), (D)(ii), is Pub. L. 92–181,
Amendments
2010—Subsec. (g)(7)(A)(ii). Pub. L. 111–203, § 362(3)(A)(i), substituted “(b)(9)” for “(b)(8)”.
Subsec. (g)(7)(A)(v). Pub. L. 111–203, § 362(3)(A)(ii), substituted “financial” for “depository” and inserted “and” at end.
Subsec. (g)(7)(A)(vi). Pub. L. 111–203, § 362(3)(A)(iii), substituted “Agency” for “Board” and a period for “; and” at end.
Subsec. (g)(7)(A)(vii). Pub. L. 111–203, § 362(3)(A)(iv), struck out cl. (vii) which read as follows: “the Resolution Trust Corporation.”
Subsec. (g)(7)(D)(iii). Pub. L. 111–203, § 362(3)(B)(i), inserted “and” at end.
Subsec. (g)(7)(D)(iv). Pub. L. 111–203, § 362(3)(B)(ii), substituted “Agency” for “Board” and struck out “and” at end.
Subsec. (g)(7)(D)(v). Pub. L. 111–203, § 362(3)(B)(iii), struck out cl. (v) which read as follows: “the Thrift Depositor Protection Oversight Board, in the case of the Resolution Trust Corporation.”
2006—Subsec. (b)(1). Pub. L. 109–351, § 716(b)(1), substituted “any action on any application, notice, or other request by the credit union or institution-affiliated party,” for “the granting of any application or other request by the credit union” in first sentence.
Subsec. (e)(3)(D). Pub. L. 109–351, § 726(14), struck out “and” after semicolon.
Subsec. (f)(1). Pub. L. 109–351, § 726(15), substituted “subsection (e)(3)” for “subsection (e)(3)(B)”.
Subsec. (g)(1)(A)(i)(III). Pub. L. 109–351, § 716(b)(2), substituted “any action on any application, notice, or request by such credit union or institution-affiliated party” for “the grant of any application or other request by such credit union”.
Subsec. (g)(7)(D). Pub. L. 109–351, § 726(16), struck out “and subsection (1)” after “For purposes of this paragraph” in introductory provisions.
Subsec. (i). Pub. L. 109–351, § 708(b)(2), inserted heading.
Subsec. (i)(1)(A). Pub. L. 109–351, § 708(b)(1)(A), substituted “any credit union” for “the credit union” in two places.
Subsec. (i)(1)(B)(i). Pub. L. 109–351, § 708(b)(1)(B), inserted “of which the subject of the order is, or most recently was, an institution-affiliated party” before period at end.
Subsec. (i)(1)(C). Pub. L. 109–351, § 708(b)(1)(C), substituted “any credit union’s” for “the credit union’s” in cl. (i) and “any credit union” for “the credit union” wherever appearing.
Subsec. (i)(1)(D)(i). Pub. L. 109–351, § 708(b)(1)(D), substituted “upon the credit union of which the subject of the order is, or most recently was, an institution-affiliated party” for “upon such credit union”.
Subsec. (i)(1)(E). Pub. L. 109–351, § 708(b)(1)(E), added subpar. (E).
Subsec. (k)(2)(A)(iii). Pub. L. 109–351, § 716(b)(3), substituted “any action on any application, notice, or other request by the credit union or institution-affiliated party” for “the grant of any application or other request by such credit union”.
Subsec. (k)(3). Pub. L. 109–351, § 715(b), inserted “or order” after “notice” in two places.
Subsec. (s)(9). Pub. L. 109–351, § 723(b), added par. (9).
Subsec. (t)(2)(B). Pub. L. 109–351, § 726(17), inserted “regulations” after “(as defined in”.
Subsec. (t)(2)(C). Pub. L. 109–351, § 726(18), substituted “material effect” for “material affect”.
Subsec. (t)(4)(A)(ii)(II). Pub. L. 109–351, § 726(19), struck out “or” after semicolon at end.
2004—Subsec. (w). Pub. L. 108–458 added subsec. (w).
1998—Subsec. (h)(1). Pub. L. 105–219, § 301(g)(2), inserted “or another (including, in the case of a State-chartered insured credit union, the State official having jurisdiction over the credit union)” after “appoint itself” in introductory provisions.
Subsec. (h)(1)(F), (G). Pub. L. 105–219, § 301(b)(1)(A), added subpars. (F) and (G).
Subsec. (h)(2)(A). Pub. L. 105–219, § 301(b)(1)(B)(i), substituted “Except as provided in subparagraph (C), in the case” for “In the case”.
Subsec. (h)(2)(C). Pub. L. 105–219, § 301(b)(1)(B)(ii), added subpar. (C).
Subsec. (k)(1). Pub. L. 105–219, § 301(g)(1)(A), inserted “or section 1790d of this title” after “this section” in three places.
Subsec. (k)(2)(A)(ii). Pub. L. 105–219, § 301(g)(1)(B), inserted “, or any final order under section 1790d of this title” before semicolon at end.
1994—Subsecs. (h)(1)(C), (i)(1)(A)(ii), (v)(1)(B). Pub. L. 103–325 substituted “section 5322 or 5324 of title 31” for “section 5322 of title 31”.
1992—Subsec. (g)(2). Pub. L. 102–550, § 1504(b)(1), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “Whenever, in the opinion of the Board, any director, officer, or committee member of an insured credit union has committed any violation of the Depository Institution Management Interlocks Act, the Board may serve upon such director, officer, or committee member a written notice of its intention to remove him from office.”
Subsec. (h)(1)(C) to (E). Pub. L. 102–550, § 1501(b), added subpar. (C) and redesignated former subpars. (C) and (D) as (D) and (E), respectively.
Subsec. (i)(1). Pub. L. 102–550, § 1504(b)(2), amended par. (1) generally, subdividing existing provisions into subpars. (A) to (D), and, in subpar. (A), including violations under section 1956, 1957, or 1960 of title 18 or section 5322 of title 31 as reason for suspension of any violator from further participation in the affairs of the credit union.
Subsec. (v). Pub. L. 102–550, § 1503(b), added subsec. (v).
1990—Subsec. (j)(1). Pub. L. 101–647, § 2547(b)(2), which directed amendment of par. (1) by striking out after first sentence “Such hearing shall be private, unless the Board, 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.” was executed by striking out “Such hearing shall be private unless the Board, 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.” as the probable intent of Congress.
Subsec. (s). Pub. L. 101–647, § 2547(b)(1), amended subsec. (s) generally. Prior to amendment, subsec. (s) read as follows:
“(1) In general.—The Board shall publish and make available to the public—
“(A) any final order issued with respect to any administrative enforcement proceeding initiated by such agency under this section or any other provision of law; and
“(B) any modification to or termination of any final order described in subparagraph (A).
“(2) Delay of publication under exceptional circumstances.—If the Board makes a determination in writing that the publication of any final order pursuant to paragraph (1) would seriously threaten the safety or soundness of an insured credit union or other federally regulated depository institution, the Board may delay the publication of such order for a reasonable time.”
Subsec. (t). Pub. L. 101–647, § 2523(b), added subsec. (t).
Subsec. (u). Pub. L. 101–647, § 2532(c), added subsec. (u).
1989—Subsec. (e)(1). Pub. L. 101–73, § 901(b)(2)(A), (B), substituted references to institution-affiliated parties for references to directors, officers, committee members, agents, or other persons participating in the conduct of the affairs of credit unions. Substitution by section 901(b)(2)(A)(ii) was executed to reflect the probable intent of Congress, notwithstanding an error in the directory language.
Subsec. (e)(3), (4). Pub. L. 101–73, § 902(b)(1), added pars. (3) and (4).
Subsec. (f)(1). Pub. L. 101–73, § 902(b)(2)(B), substituted “significant” for “substantial”, struck out “seriously” before “weaken the condition of” and before “prejudice the interests of”, and inserted after first sentence “Such order may include any requirement authorized under subsection (e)(3)(B) of this section.”
Pub. L. 101–73, § 901(b)(2)(B), (C), substituted references to institution-affiliated parties for references to directors, officers, committee members, employees, agents, or other persons participating in the conduct of the affairs of credit unions.
Subsec. (f)(2). Pub. L. 101–73, § 901(b)(2)(B), substituted references to institution-affiliated parties for references to directors, officers, committee members, employees, agents, or other persons participating in the conduct of the affairs of credit unions.
Subsec. (f)(3), (4). Pub. L. 101–73, § 902(b)(2)(A), (C), added par. (3) and redesignated former par. (3) as (4).
Subsec. (g)(1). Pub. L. 101–73, § 903(b)(1), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “Whenever, in the opinion of the Board, any director, officer, committee member, or employee of an insured credit union has committed any violation of law, rule, or regulation, or of a cease-and-desist order which has become final, or has engaged or participated in any unsafe or unsound practice in connection with the credit union, or has committed or engaged in any act, omission, or practice which constitutes a breach of his fiduciary duty as such director, officer, committee member, or employee and the Board determines that the credit union has suffered or will probably suffer substantial financial loss or other damage or that the interests of its insured members could be seriously prejudiced by reason of such violation or practice or breach of fiduciary duty, the Board may serve upon such director, officer, committee member, or employee a written notice of its intention to remove him from office.”
Subsec. (g)(2). Pub. L. 101–73, § 903(b)(2), redesignated par. (3) as (2) and struck out former par. (2) which read as follows: “Whenever, in the opinion of the Board, any director, officer, committee member, or employee of an insured credit union, by conduct or practice with respect to another insured credit union or other business institution which resulted in substantial financial loss or other damage, has evidenced his personal dishonesty or unfitness to continue as a director, officer, committee member, or employee, and, whenever, in the opinion of the Board, any agent or other person participating in the conduct of the affairs of an insured credit union, by conduct or practice with respect to such credit union or other insured credit union or other business institution which resulted in substantial financial loss or other damage, has evidenced his personal dishonesty or unfitness to participate in the conduct of the affairs of such insured credit union, the Board may serve upon such director, officer, committee member, employee, agent, or other person a written notice of its intention to remove him from office and/or to prohibit his further participation in any manner in the conduct of the affairs of such credit union.”
Subsec. (g)(3). Pub. L. 101–73, § 903(b)(2), added par. (3). Former par. (3) redesignated (2).
Subsec. (g)(4). Pub. L. 101–73, § 903(b)(2), redesignated par. (5) as (4) and struck out former par. (4) which provided for temporary suspension from office or prohibition from further participation in credit union activities.
Subsec. (g)(5). Pub. L. 101–73, § 903(b)(2), (3), added par. (5). Former par. (5) redesignated (4).
Subsec. (g)(6). Pub. L. 101–73, § 903(b)(4), substituted “credit union under paragraph (3)” for “credit union under paragraph (4)” and “person under paragraph (1) or (2)” for “person under paragraph (1), (2), or (3)”.
Subsec. (g)(7). Pub. L. 101–73, § 904(b), amended par. (7) generally, revising and restating as subpars. (A) to (F) provisions of former subpars. (A) and (B).
Subsec. (h)(3). Pub. L. 101–73, § 1217(b), inserted at end “Except as provided in this paragraph, no court may take any action, except at the request of the Board by regulation or order, to restrain or affect the exercise of powers or functions of the Board as conservator.”
Subsec. (i)(1). Pub. L. 101–73, § 906(b), struck out “authorized by a United States attorney” after “is charged in any information, indictment, or complaint”, and substituted “or an agreement to enter a pre-trial diversion or other similar program” for “with respect to such crime” after “judgment of conviction”.
Pub. L. 101–73, § 901(b)(2)(D)(i)–(iv), (vi), substituted references to institution-affiliated parties for references to directors, committee members, or officers of insured credit unions, or other persons participating in the conduct of the affairs of credit unions, and substituted “whereupon such party (if a director, a committee member, or an officer)” for “whereupon such director, committee member, or officer”.
Pub. L. 101–73, § 901(b)(2)(D)(v), which directed the substitution of “party” for “director, officer or other person” could not be executed because “director, officer or other person” does not appear in par. (1).
Subsec. (i)(3). Pub. L. 101–73, § 901(b)(2)(E)(i)–(iv), substituted references to institution-affiliated parties for references to directors, committee members, officers, or other persons.
Pub. L. 101–73, § 901(b)(2)(E)(v), which directed the substitution of “such party” for “said director, committee member, officer or other person” was executed by making the substitution for “said director, committee member, officer, or other person” after “whether the order removing” in third sentence to reflect the probable intent of Congress.
Subsec. (j)(2). Pub. L. 101–73, § 920(b), substituted “Any party to any proceeding under paragraph (1)” for “Any party to the proceeding, or any person required by an order issued under this section to cease and desist from any of the practices or violations stated therein,”.
Pub. L. 101–73, § 901(b)(2)(F), substituted “institution-affiliated party” for “director, officer, committee member, or other person”.
Subsec. (k)(2). Pub. L. 101–73, § 907(b), in amending par. (2) generally, designated existing provisions as cls. (i) to (iv), substituted provisions imposing a fine of $5,000 per day for violation of any law or regulation, a final or temporary order, any condition imposed in writing, or any written agreement for provisions imposing a fine of $1,000 per day for violation of any final order, authorizing the penalizing agency to compromise or modify such penalty, providing for assessment and collection of such penalty by written notice, and defining “violates”, and added subpars. (B) to (L).
Subsec. (k)(3). Pub. L. 101–73, § 905(b), added par. (3).
Subsec. (l). Pub. L. 101–73, § 908(b), amended subsec. (l) generally. Prior to amendment, subsec. (l) read as follows: “Any director, officer, or committee member, or former director, officer, or committee member, of an insured credit union or of a credit union any of the member accounts of which are insured, or any other person against whom there is outstanding and effective any notice or order (which is an order which has become final) served upon such director, officer, committee member, or other person under subsections (g)(4), (g)(5), or (i) of this section and who (i) participates in any manner in the conduct of the affairs of the credit union involved, or directly or indirectly solicits or procures, or transfers or attempts to transfer, or votes or attempts to vote, any proxies, consents, or authorizations in respect of any voting rights in such credit union, or (ii) without the prior written approval of the Board votes for a director, serves or acts as a director, officer, committee member, or employee of any credit union, shall upon conviction be fined not more than $5,000 or imprisoned for not more than one year, or both.”
Subsec. (o). Pub. L. 101–73, § 901(b)(2)(G), substituted “institution-affiliated party” for “director, officer, committee member or other person participating in the conduct of its affairs”.
Subsec. (p). Pub. L. 101–73, § 915(b), in first sentence, inserted “or in connection with any claim for insured deposits or any examination or investigation under section 1784(b) of this title” after “any proceeding under this section”, “, in conducting the proceeding, examination, or investigation or considering the claim for insured deposits,” after “section, the Board”, and “, claims, examinations, or investigations” before period at end.
Subsec. (r). Pub. L. 101–73, § 901(a), added subsec. (r).
Subsec. (s). Pub. L. 101–73, § 913(b), added subsec. (s).
1987—Pub. L. 100–86, § 509(a), repealed Pub. L. 97–320, § 141. See 1982 Amendment notes below.
Subsec. (g)(1). Pub. L. 100–86, § 709(1), substituted “committee member, or employee” for “or committee member” in three places.
Subsec. (g)(2). Pub. L. 100–86, § 709(2)–(4), substituted “committee member, or employee” for “or committee member” in two places, substituted “any agent or other person” for “any other person”, and inserted “employee, agent,” before “or other person”.
Subsec. (g)(7). Pub. L. 100–86, § 710, added par. (7).
Subsec. (h)(1)(C), (D). Pub. L. 100–86, § 711, added subpars. (C) and (D).
Subsec. (h)(2)(B). Pub. L. 100–86, § 712, substituted “30” for “ninety”.
Subsec. (h)(8), (9). Pub. L. 100–86, § 713, added par. (8) and redesignated former par. (8) as (9).
1986—Subsec. (k)(2)(A). Pub. L. 99–570, § 1359(d)(2), inserted reference to subsec. (q) of this section.
Subsec. (q). Pub. L. 99–570, § 1359(d)(1), added subsec. (q).
1984—Subsec. (d)(1). Pub. L. 98–369 inserted “(1)” after “subsection (a)”, “maintain its deposit with and”, and provisions relating to termination of insured status and the obtaining of comparable insurance coverage from another source.
1982—Subsec. (b)(2). Pub. L. 97–320, § 132(b), substituted “subsection (j)” for “subsection (i)”.
Pub. L. 97–320, § 141(a)(8), which directed that, effective
Subsec. (g)(3) to (6). Pub. L. 97–320, § 427(c)(1), added par. (3); redesignated former pars. (3) to (5) as (4) to (6), respectively; inserted reference to par. (3) in two places and substituted reference to par. (6) for par. (5) in par. (4); and inserted reference to par. (3) and substituted reference to par. (4) for par. (3) in par. (6).
Subsecs. (h), (i). Pub. L. 97–320, § 132(a), added subsec. (h) and redesignated former subsecs. (h) and (i) as (i) and (j), respectively.
Pub. L. 97–320, § 141(a)(8), which directed that, effective
Subsec. (j). Pub. L. 97–320, § 132(a), (c), (d), redesignated former subsec. (i) as (j), substituted “subsection (i)(3)” for “subsection (h)(3)” in first sentence and “subsection (j)” for “subsection (i)” in fourth sentence of par. (1), and substituted “subsection (i)(1)” for “subsection (h)(1)” after “an order issued under” in par. (2). Former subsec. (j) redesignated (k).
Pub. L. 97–320, § 141(a)(8), which directed that, effective
Subsec. (k). Pub. L. 97–320, § 132(a)(1), redesignated former subsec. (j) as (k). Former subsec. (k) redesignated (l).
Pub. L. 97–320, § 141(a)(8), which directed that, effective
Subsec. (k)(2)(A), (D). Pub. L. 97–320, § 424(a), (d)(9), (e), which directed insertion of proviso giving Board authority to compromise, etc., any civil money penalty imposed under this subsection and substitution of “may be assessed” for “shall be assessed” in subsec. (j)(2)(A), and substitution of “twenty days from the service” for “ten days from the date” in subsection (j)(2)(D), was executed to subsec. (k)(2)(A), (D) to reflect the probable intent of Congress and the redesignation of subsec. (j) as (k) by section 132(a)(1) of Pub. L. 97–320.
Subsec. (l). Pub. L. 97–320, § 132(a)(1), (e), redesignated former subsec. (k) as (l) and substituted “(i)” for “(h)” after “(g)(3), (g)(4), or”. Former subsec. (l) redesignated (m).
Pub. L. 97–320, § 141(a)(8), which directed that, effective
Pub. L. 97–320, § 427(c)(2), which directed substitution of reference to subsec. (g)(5) for subsec. (g)(3) in subsec. (k), was executed to subsec. (l) to reflect the probable intent of Congress and the redesignation of subsec. (k) as (l) by section 132(a)(1) of Pub. L. 97–320.
Subsec. (m). Pub. L. 97–320, § 132(a)(1), (f), redesignated former subsec. (l) as (m) and substituted “subjection (j)” for “subsection (i)” after “paragraph (2) of” and “subsection (i)” for “subsection (h)” after “an order issued under”. Former subsec. (m) redesignated (n).
Pub. L. 97–320, § 141(a)(8), which directed that, effective
Subsecs. (n) to (p). Pub. L. 97–320, § 132(a)(1), redesignated former subsecs. (m) to (o) as (n) to (p), respectively.
Pub. L. 97–320, § 141(a)(8), which directed that, effective
1978—Subsecs. (a) to (d). Pub. L. 95–630, § 502(b), substituted “Board” for “Administrator” wherever appearing, and “it” and “its” for “he” and “his”, respectively, where appropriate.
Subsec. (e). Pub. L. 95–630, §§ 107(a)(4), 502(b), substituted “Board” for “Administrator” wherever appearing, and in par. (1) extended coverage of provisions to include directors, officers, committee members, employees, agents, or other persons participating in the conduct of the affairs of any insured credit union or credit union which has insured accounts.
Subsec. (f). Pub. L. 95–630, §§ 107(c)(4), 502(b), substituted “Board” for “Administrator” wherever appearing, inserted references to any director, officer, committee member, employee, agent, or other person participating in the conduct of the affairs of the credit union, and inserted in par. (1) “prior to the completion of the proceedings conducted pursuant to paragraph (1) of subsection (e) of this section” after “its insured members” and “and to take affirmative action to prevent such insolvency, dissipation, condition, or prejudice pending completion of such proceedings” after “violation or practice”.
Subsec. (g). Pub. L. 95–630, §§ 107(d)(4), 502(b), substituted “Board” for “Administrator” wherever appearing, in pars. (1), (2) “its” for “his”, in par. (3) “it” for “he”, “or prohibit him” for “and/or prohibit him”, “suspension or prohibition” for “suspension and/or prohibition”, and “removal and prohibition” for “removal and/or prohibition”, and in par. (4) “or to prohibit” for “and/or to prohibit”, “removal or prohibition” for “removal and/or prohibition”, and “or prohibition” for “and/or prohibition”.
Subsec. (h). Pub. L. 95–630, §§ 111(d)(1), 502(b), among other changes, substituted “Board” for “Administrator” wherever appearing, in par. (1) substituted “Crime” for “felony” in two places and “subsection (g) of this section” for “paragraph (1) or (2) of subsection (g) of this section”, inserted “which is punishable by imprisonment for a term exceeding one year under State or Federal law” after “or breach of trust” and “, if continued service or participation by the individual may pose a threat to the interests of the credit union’s members or may threaten to impair public confidence in the credit union” after “the Board may” in two places, and inserted provision that any notice of suspension or order of removal issued under this paragraph remain effective and outstanding until the completion of any hearing or appeal authorized under paragraph (3) hereof unless terminated by the Board, and added par. (3).
Subsec. (i). Pub. L. 95–630, §§ 111(d)(2), (3), 502(b), substituted “Board” for “Administrator” wherever appearing, in par. (1) substituted “its” for “his” and “it” for “he” and “him” and inserted “(other than the hearing provided for in subsection (h)(3) of this section)” after “provided for in this section”, and in par. (2) substituted “subsection (h)(1)” for “subsection (h)”.
Subsec. (j). Pub. L. 95–630, §§ 107(e)(4), 502(b), designated existing provisions as par. (1), added par. (2), and substituted “Board” for “Administrator” wherever appearing and “its” for “his” in par. (1).
Subsecs. (k) to (o). Pub. L. 95–630, § 502(b), substituted “Board” for “Administrator” wherever appearing.
1977—Subsec. (g)(1). Pub. L. 95–22, § 307(a), struck out “and that such violation or practice or breach of fiduciary duty is one involving personal dishonesty on the part of such director, officer, or committee member” after “or breach of fiduciary duty”.
Subsec. (g)(2). Pub. L. 95–22, § 307(b), substituted “dishonesty or unfitness” for “dishonesty and unfitness” wherever appearing.
1974—Subsec. (a). Pub. L. 93–383, § 728(a), designated existing provisions as par. (1) and added par. (2).
Subsec. (c). Pub. L. 93–383, § 728(b), inserted “(1)” after “(a)”.
Subsec. (d). Pub. L. 93–383, § 728(c), designated existing provisions as par. (1) and added pars. (2) and (3).
Change Of Name
Oversight Board redesignated Thrift Depositor Protection Oversight Board, effective
Effective Date Of Amendment
Amendment by Pub. L. 111–203 effective on the transfer date, see section 351 of Pub. L. 111–203, set out as a note under section 906 of Title 2, The Congress.
Pub. L. 108–458, title VI, § 6303(d),
Pub. L. 102–550, title XV, § 1501(c),
Pub. L. 101–73, title IX, § 903(e),
Amendment by sections 107(a)(4), (c)(4), (d)(4), and 111(d)(1)–(3) of Pub. L. 95–630 effective upon expiration of 120 days after
Amendment by section 107(e)(4) of Pub. L. 95–630 applicable to violations occurring or continuing after
Amendment by section 502(b) of Pub. L. 95–630 effective on expiration of 120 days after
Miscellaneous
The regulations required to be prescribed under amendment by Pub. L. 99–570 effective at end of 3-month period beginning on
No amendment made by section 141(a) of Pub. L. 97–320, set out as a note under section 1464 of this title, as in effect before
No amendment made by section 141(a) of Pub. L. 97–320, set out as a note under section 1464 of this title, as in effect on the day before
Section 141(a) of Pub. L. 97–320, set out as a note under section 1464 of this title, as in effect on the day after