2 CMPs, prohibition order among March enforcement actions by FDIC

$200,000 CMP order cites FTC Act, TCPA violations

Two civil money penalty (CMP) assessments, one of them including a prohibition order against a person formerly affiliated with a bank in receivership, were among the 13 enforcement orders released in March by the Federal Deposit Insurance Corp. (FDIC). The FDIC also disclosed it has an administrative hearing on another matter set for May 21.

Regarding the two CMPs and prohibition:

  • A $200,000 CMP was assessed against Peoples Bank and Trust Company, Ryan, Okla., under a March 1 consent order citing violations of the Federal Trade Commission Act (FTC Act) and the Telephone Consumer Protection Act (TCPA). The order says FDIC determined that the bank had violated the FTC Act by telemarketers misrepresenting themselves to consumers as employees or affiliates of the federal government; and violated the TCPA and its implementing regulations by continuously calling consumers who were already on the National Do Not Call Registry or who had requested to be placed on the bank’s internal Do Not Call List.
  • The FDIC assessed a $10,000 CMP against Yixing Sun, a former institution-affiliated party of United Commercial Bank, San Francisco, Calif., which was in receivership. The March 15 consent order, which also prohibits Yixing Sun from further participation in the future in the affairs of any insured financial institution, says that the FDIC had reason to believe that Yixing Sun had engaged or participated in violations, reckless unsafe or unsound banking practices, and breaches of fiduciary duty as an institution-affiliated party; that these activities were part of a pattern of misconduct and resulted in financial loss or other damage to the bank and prejudiced the interests of depositors; and that the actions demonstrated willful and/or continuing disregard for the safety and soundness of the bank.

Among the other March orders released were four Section 19 orders (allowing prohibited persons to apply for leave again to work in a financial institution); two voluntary terminations of insurance orders; and five cease-and-desist orders.

In addition, the FDIC also announced a hearing scheduled May 21 involving Alamerica Bank of Birmingham, Ala. No details were noted about the purpose of the hearing. However, Alamerica Bank’s September 2018 Community Reinvestment Act (CRA) evaluation report, posted on the FDIC’s website, states that the bank was still operating under a consent order from Aug. 29, 2014, with FDIC and the Alabama State Banking Department regarding capital, lending policies and practices, and liquidity. (The bank received a CRA rating of “satisfactory,” according to the report.)

FDIC Makes Public March Enforcement Actions; One Administrative Hearing Scheduled for May 2019

March 2019 Enforcement Decisions and Orders