Two civil money penalties totaling $190k among June enforcement actions by the FDIC

A bank in California and a former Iowa bank official were assessed civil money penalties (CMPs) in June by the Federal Deposit Insurance Corp. (FDIC), according to orders released Friday.

On June 1, the FDIC issued an order to pay a $175,000 CMP against California Pacific Bank (San Francisco) related to violations of a 2016 cease-and-desist order citing Bank Secrecy Act (BSA) violations. (The order to pay was issued following a stipulation and consent order between the bank and the agency.)

On June 25, James P. Sappington, formerly with Corydon State Bank (Corydon, Iowa), was prohibited from any future work in a federally insured financial institution and assessed a $15,000 CMP. That order cited unsafe or unsound banking practices and breaches of fiduciary duty. Specifically, the FDIC found that Sappington, as director, president, chief executive officer, and senior lender of the bank, made unauthorized withdrawals from a customer’s account and from an internal bank account for his personal use; and that he falsified banks records to hide these withdrawals.

The agency on Friday reported also issuing in June three consent orders, four removal orders, five voluntary terminations of deposit insurance; 11 section 19 orders; and one termination of consent order.

June 2020 Enforcement Decisions and Orders

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