Two former employees of Regions Bank, Birmingham, Ala., would be barred permanently from working in the banking industry and pay a collective $28,404 in civil money penalties (CMPs) for inflating credit applicants’ incomes and, in some cases, opening credit card accounts without customer authorization under a notice of intent released Monday by the Federal Reserve Board.
The notice describes the alleged activities of former bank employees Nathaniel Frazier and Jeffrey Garrison and focuses on the period from June 7, 2013, through Jan. 31, 2017. Both men are charged with engaging in unsafe or unsound banking practices and for violating federal prohibitions against bank employees making false entries with intent to injure or defraud such bank. The latter charge can bring fines of up to $1 million or 30 years in prison.
In the case of these two, the Fed intends to impose fines of $18,936 against Frazier and $9,468 against Garrison.
Frazier was most recently a branch manager at Regions and had been with the bank since August 2011, when he first joined as a financial services specialist. The Fed’s notice says he “improperly inflated credit applicants’ reported income, encouraged his subordinates at Southgate (Branch) to engage in such practices, and failed to take appropriate action when confronted with information of such practices by Garrison.” Frazier’s actions were “in direct contravention of Regions’ policies and applicable law,” it states.
Frazier, according to the notice, on multiple occasions “made false entries in the bank’s records, by improperly inflating credit applicants’ reported income for stated income products, such as credit cards, personal loans, and personal lines of credit, to qualify applicants for products [for] which they would otherwise not be able to qualify.” His actions resulted in a financial loss to Regions of at least $14,110. The bank terminated his employment June 6, 2017.
Garrison worked at the Southgate and Houston branches, and he is cited for similar offenses as well as for originating several credit cards accounts without customer authorization. At Southgate, he received $15,154 in incentive compensation; his actions also resulted in a financial loss to the bank of at least $2,910, the notice says.
Garrison had worked at the bank since July 2015 as a financial services specialist. He resigned March 7, 2017.