FDIC Issues 53 August Enforcement Actions On Problem Banks

The FDIC issued a list of 53 administrative enforcement actions taken in August against problem banks and individuals.

Among the enforcement actions issued were 11 consent orders, 14 civil money penalties, 1 prompt corrective action and 17 orders terminating previous prompt corrective action directives, consent orders and cease and desist orders.   Please see complete list below.

Regulators publicly disclose formal enforcement actions which are used when regulators have limited confidence in a bank’s financial status and to address severe capital or operating deficiencies.  As capital levels deteriorate, the FDIC (under Section 38 of the FDIC Improvement Act of 1991) is required to take increasingly severe supervisory actions.  Regulators generally are required to close a critically undercapitalized institution within 90 days.

Descriptions of the most serious regulatory orders issued by the FDIC are listed below.

A cease and desist order is imposed in an involuntary manner when the FDIC has “determined that it had reason to believe that the Bank engaged in unsafe or unsound banking practices and violations of law and/or regulations.”  Under recent enforcement action nomenclature changes, if the financial institution accepts the FDIC cease and desist order, it is now issued as a “consent order”.

Under a consent order, a bank executes a “Stipulation to the Issuance of a Consent Order” under which a bank has consented to the issuance of the Consent Order “without admitting or denying any charges of unsafe or unsound banking practices or violations of law or regulations relating to weaknesses in asset quality, capital adequacy, earnings, management effectiveness, liquidity, and sensitivity to market risk”.

A prompt corrective action (PCA) directive by the FDIC is a more serious “formal action that requires an institution to take one or more specified actions to return to required minimum capital standards”.  Many of the financial institutions that receive a PCA are unable to comply with the directive and are shortly thereafter closed by regulators.

It is likely that most of the banks receiving enforcement actions are on the FDIC’s Problem Bank List.  The latest second quarter report from the FDIC shows a total of 865 banks classified as “problem banks”.

Listed below are the FDIC public enforcement actions for August 2011.

FINAL ORDERS ISSUED PURSUANT TO SECTION 8(b), 12 U.S.C. § 1818(b)
(Consent Orders)

Country Bank, Aledo, IL; FDIC-11-433b; Issued 8/17/11 – PDF

State Bank of Herscher, Herscher, IL; FDIC-11-327b; Issued 8/3/11 – PDF

Farmers’ and Traders’ State Bank, Shabbona, IL; FDIC-11-308b; Issued 8/31/11 – PDF

State Central Bank, Keokuk, IA; FDIC-11-306b; Issued 8/24/11- PDF

Hometown Community Bank, Cyrus, MN; FDIC-11-226b; Issued 8/8/11 – PDF

Amalgamated Bank, New York, NY; FDIC-11-260b; Issued 8/31/11 – PDF

Community Bank of the Arbuckles, Sulphur, OK; FDIC-11-305b; Issued 8/26/11 – PDF

GreenBank, Greeneville, TN; FDIC-11-143b; Issued 8/15/11 – PDF

The Citizens State Bank, Corrigan, TX; FDIC-11-354b; Issued 8/26/11 – PDF

RiverBank, Spokane, WA; FDIC-11-385b; Issued 8/29/11 – PDF

The Bank of Kaukauna, Kaukauna, WI; FDIC-11-291b; Issued 8/31/11 – PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 8(e), 12 U.S.C. § 1818(e)
(Removal and Prohibition Orders)

Central Bank of Georgia, Ellaville, GA; FDIC-10-625e; FDIC-10-624k; in the amount of $15,000.00; against William Ben Dupree, III; Issued 8/29/11 – PDF

BancorpSouth Bank, Tupelo, MS; FDIC-10-064e; against Christie McCarty; Issued 8/11/11 – PDF

BankAsiana, Palisades Park, NJ; FDIC-10-871e; against James T. Kang; Issued 8/1/11 – PDF

Branch Banking and Trust, Winston-Salem, NC; FDIC-11-280e; against Lisa Michelle Darbrowski; Issued 8/11/11 – PDF

First Midwest Bank, Centerville, SD; FDIC-10-869e; against Lee C. Peterson; Issued 8/1/11 – PDF

City Bank, Lubbock, TX; FDIC-10-818e; against Mary Frances Dunn; Issued 8/11/11- PDF

Bank of Clark County (In Receivership), Vancouver, WA; FDIC-10-416e; against David Kennelly; Issued 8/11/11 – PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 8(g), 12 U.S.C. § 1818(g)

SunFirst Bank, St. George, UT; FDIC-11-221g; against John Campos; Issued 8/1/11 – PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 8(i), 12 U.S.C. § 1818(i)
(Civil Money Penalties)

Quinnipiac Bank & Trust Company, Hamden, CT; FDIC-11-387k; in the amount of $4,275.00; Issued 8/25/11 – PDF

Ocean Bank, Miami, FL, FDIC-11-045k; in the amount of $10,900,000.00; Issued 8/22/11 – PDF

Central Bank of Georgia, Ellaville, GA; FDIC-10-625e; FDIC-10-624k; Order of Removal From Office and Prohibition From Further Participation and Order to Pay a Civil Money Penalty against William Ben Dupree, III in the amount of $15,000.00; Issued 8/29/11 – PDF

Fidelity Bank, West Des Moines, IA; FDIC-11-323k; in the amount of $10,000.00; Issued 8/4/11 – PDF

First Guaranty Bank, Martin, KY; FDIC-11-156k; in the amount of $1,800.00; Issued 8/22/11 – PDF

Seaway Community Bank, Saint Clair, MI; FDIC-11-168k; in the amount of $7,400.00; Issued 8/22/11 – PDF

Vermillion State Bank, Vermillion, MN; FDIC-11-409k; in the amount of $8,000.00; Issued 8/29/11 – PDF

Vermillion State Bank, Vermillion, MN; FDIC-11-410k; in the amount of $4,235.00; Issued 8/29/11 – PDF

FortuneBank, Arnold, MO; FDIC-11-343k; in the amount of $3,000.00; Issued 8/12/11 – PDF

Community State Bank of Missouri, Bowling Green, MO; FDIC-11-373k; in the amount of $3,000.00; Issued 8/2/11 – PDF

Patriots Bank, Liberty, MO, FDIC-11-374k; in the amount of $5,000.00; Issued 8/16/11 – PDF

Integrity Bank, Camp Hill, PA; in the amount of $12,610.00; FDIC-11-360k; Issued 8/31/11 – PDF

First Midwest Bank, Centerville, SD; FDIC-10-870k; against Lee C. Peterson in the amount of $35,000.00; Issued 8/1/11 – PDF

Plains Commerce Bank, Hoven, SD; FDIC-11-407b; in the amount of $10,000.00; Issued 8/18/11 – PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 38, 12 U.S.C. § 1831o
(Prompt Corrective Action)

Community Shores Bank, Muskegon, MI; FDIC-11-412PCAS; Issued 8/17/11 – PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 19, 12 U.S.C. § 1829
(Section 19)

Ronald L. Wynn Jr. ; FDIC-10-949L; Order Granting Permission to File Application and Approving Application for Consent to Participate in the Affairs of any Insured Depository Institution; Issued 8/5/11 – PDF

Donald Patrick Crane, FDIC-11-382L; Order Denying Application for a Waiver of the Depository Institution Filing Requirement; Issued 8/25/11 – PDF

TERMINATIONS

Orders Terminating Consent Orders and Cease and Desist Orders

Peoples Independent Bank, Boaz, AL; FDIC-09-670b; Issued 8/22/11 – PDF

Sunrise Bank, San Diego, CA; FDIC-09-732b; Issued 8/9/11 – PDF

Bank of Choice, Greeley, CO; FDIC-10-142b; Issued 8/15/11 – PDF

Oceanside Bank, Jacksonville Beach, FL; FDIC-09-037b; Issued 8/12/11 – PDF

First Peoples Bank, Port St. Lucie, FL; FDIC-09-717b; Issued 8/15/11 – PDF

Grand Rivers Community Bank, Grand Chain, IL; FDIC-09-093b; Issued 8/15/11 – PDF

High Trust Bank, Stockbridge, GA; Now known as Ameris Bank, Moultrie, GA; FDIC-09-486b; Issued 8/12/11 – PDF

Bank of Shorewood, Shorewood, IL; FDIC-09-392b; Issued 8/19/11 – PDF

Clarkston State Bank, Clarkston, MI; FDIC-08-056b; Issued 8/17/11 – PDF

Citizens Bank of Spencer, Tenn.; Spencer, TN; FDIC-10-651b; Issued 8/15/11 – PDF

Jefferson Bank, Dallas, TX; FDIC-09-452b; Issued 8/17/11 – PDF

Western Community Bank, Orem, UT; Now Known As Rock Canyon Bank; Orem, UT; FDIC-09-368b; Issued 8/5/11 – PDF

Home Savings Bank, Salt Lake City, UT; FDIC-09-418b; Issued 8/16/11 – PDF

Order Terminating Supervisory Prompt Corrective Action Directive

Bank of Choice, Greeley, CO; FDIC-11-038PCAS; Issued 8/15/11 – PDF

Broadway Bank, Chicago, IL; FDIC-10-266PCAS; Issued 8/22/11 – PDF

Bank of Shorewood, Shorewood, IL; FDIC-11-115PCAS; Issued 8/19/11 – PDF

The Bank of Commerce, Wood Dale, IL; FDIC-10-767PCAS; Issued 8/19/11 – PDF

NOTICES ISSUED
(Note: A Notice is not a final decision or order by the FDIC, but initiates an administrative hearing that may result in the issuance of a final decision or order)

Notice of Intention to Prohibit From Further Participation, and Notice of Assessment of Civil Money Penalty, Findings of Fact and Conclusions of Law, Order to Pay, and Notice of Hearing

Integrity Bank, Alpharetta, GA; FDIC-10-356e; Notice of Intention to Prohibit From Further Participation, Findings of Fact and Conclusions of Law, and Notice of Hearing against Joseph Todd Foster; Issued 8/19/11 – PDF

Appalachian Community Bank, Ellijay, GA; FDIC-11-255e; FDIC-11-262k; Notice of Intention to Prohibit From Further Participation, and Notice of Assessment of Civil Money Penalty, Findings of Fact and Conclusions of Law, Order to Pay, and Notice of Hearing against Adam M. Teague; Issued 8/11/11 – PDF

Silver State Bank, Henderson, NV; FDIC-11-370e; FDIC-11-371k; Notice of Intention to Remove and Prohibit From Further Participation, Notice of Assessment of Civil Money Penalties, Findings of Fact and Conclusions of Law, Order to Pay, and Notice of Hearing against Steven D. Haynes; Issued 8/2/11 – PDF

 

 

 

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