FDIC Announces December Enforcement Actions

The FDIC recently announced a list of fifteen administrative enforcement decisions and orders taken against banks and individuals in December 2018 (and one in October 2018), including two that assessed civil money penalties.

In the first order assessing a civil money penalty, an Illinois-based bank was assessed $12,416 for alleged violations of the Flood Disaster Protection Act (FDPA) and the National Flood Insurance Act (NFIA) including failing to (i) obtain flood insurance at origination in two instances; (ii) obtain or maintain adequate flood insurance in eleven instances; and (iii) properly force place flood insurance in nine instances.

The second order assessing a civil money penalty involved a Wisconsin-based bank for allegedly engaging in a pattern of violating the FDPA and the NFIA, including failing to (i) follow force placed flood insurance procedures, including notifying a borrower of a lapse in flood insurance coverage and force placing the necessary insurance in a timely fashion; (ii) obtain adequate flood insurance coverage on a loan at origination; and (iii) provide notice to a borrower concerning whether flood insurance under the NFIA was available for the collateral securing a loan.