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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