Penalty of $300k assessed for TILA violations

A civil money penalty (CMP) of $300,000 was assessed against a Louisville, Ky., bank in October, the Federal Deposit Insurance Corp. (FDIC) said Friday; the action was one of 16 enforcement actions taken in October that the deposit insurer released publicly.

Under the order, Republic Bank & Trust Company of Louisville agreed to pay the penalty after the FDIC determined the bank violated provisions of the Truth in Lending Act (TILA), “by failing to clearly and conspicuously disclose required information related to the Bank’s Elastic line of credit product,” offered in a contract with a vendor.

The FDIC order also said Republic violated Section 5 of the Federal Trade Commission Act (15 U.S.C. § 45(a)(l)), by using a processing order for certain deposit account transactions contrary to the processing orders disclosed in the bank’s deposit account disclosures.

The FDIC also revealed two other CMPs assessed in October: $9,600 against Gibsland Bank & Trust Co. of Gibsland, La., for various flood insurance requirement violations, and; $5,000 against David L. Peters, formerly of Community First Bank, Inc. of Walhalla, S.C., for “unsafe or unsound banking practices and breaches of fiduciary duty,” according to the agency. The FDIC said Peters was also prohibited from future employment with a federally insured financial institution without the prior permission of the FDIC, the agency said. (The action was taken in July, but made public in October.)

FDIC Makes Public October Enforcement Actions