Bank directors, former CEO, face fines for failing to address earlier enforcement action

Five former directors of a Montana bank were fined $2,000 each – and the bank’s former president and board chairman $10,000 — for failing to take actions to correct issues outlined under a previous consent order their bank agreed to with the regulator of national banks, according to enforcement actions released publicly Friday by the agency.

In its report, the Office of the Comptroller of the Currency (OCC) showed that it issued civil money penalties (CMPs) in December against former directors of First Citizens Bank of Polson, Mont. The fines were assessed, the OCC said, after the directors “failed to take the necessary actions to ensure the Bank corrected the deficiencies underlying the Consent Order” which, OCC said, caused the directors to be violation of the order.

All six agreed to new orders assessing the CMPs. The directors named in the OCC reports are: David Doepke, director; Catherine Francis, director; Jolanda Ingram, director; Richard Pedersen, director; Robert Sloan, former executive vice president and director; and Rick Skates, former bank president and chairman of the board.

The fines were issued after the directors and executives failed to take action under a 2010 order dealing with violations of 12 U.S.C. § 161, which covers call reports – including dates for making them – payment of dividends and reports of affiliates.

In other enforcement actions made public Friday, the OCC said it had issued three removal/prohibition orders against:

  • Stephen T. Carbonella of Webster Bank in Waterbury, Conn., for 394 unauthorized transactions totaling $1.7 million from customer accounts and certificates of deposit at the Orange Banking Center of the Bank, causing the bank a loss of more than $879,000.
  • Hunter J. Pabian, formerly of Security National Bank of Omaha (Neb.) for misapplying approximately $9,600 of bank deposits, using some for his own benefit.
  • Javier Juarez, formerly of Wells Fargo Bank in Sioux Falls, S.D., for making 13 unauthorized withdrawals, totaling more than $40,000, from the accounts of five bank customers.

The OCC also reported it had reached a formal agreement with Beacon Business Bank of San Francisco after finding (as a result of examination) “unsafe or unsound practices, including those relating to enterprise governance, concentrations of credit, and credit risk management.” The agreement requires the bank to take a number of steps, over a specific period of time, to address management deficiencies uncovered during the exam.

OCC Enforcement Actions and Terminations for January 2019

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