12 USC 504 – Civil money penalty
(a) First tier
Any member bank which, and any institution-affiliated party (within the meaning of section 1813(u) of this title) with respect to such member bank who, violates any provision of section 371c, 371c-1, 375, 375a, 375b, 376, or 503 of this title, or any regulation issued pursuant thereto, shall forfeit and pay a civil penalty of not more than $5,000 for each day during which such violation continues.
(b) Second tier
Terms Used In 12 USC 504
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Fiduciary: A trustee, executor, or administrator.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- National Bank: A bank that is subject to the supervision of the Comptroller of the Currency. The Office of the Comptroller of the Currency is a bureau of the U.S. Treasury Department. A national bank can be recognized because it must have "national" or "national association" in its name. Source: OCC
- State: means a State, the District of Columbia, the Commonwealth of Puerto Rico, or any other territory or possession of the United States. See 1 USC 7
Notwithstanding subsection (a), any member bank which, and any institution-affiliated party (within the meaning of section 1813(u) of this title) with respect to such member bank who 1
(1)(A) commits any violation described in subsection (a);
(B) recklessly engages in an unsafe or unsound practice in conducting the affairs of such member bank; or
(C) breaches any fiduciary duty;
(2) which violation, practice, or breach—
(A) is part of a pattern of misconduct;
(B) causes or is likely to cause more than a minimal loss to such member bank; or
(C) results in pecuniary gain or other benefit to such party,
shall forfeit and pay a civil penalty of not more than $25,000 for each day during which such violation, practice, or breach continues.
(c) Third tier
Notwithstanding subsections (a) and (b), any member bank which, and any institution-affiliated party (within the meaning of section 1813(u) of this title) with respect to such member bank who—
(1) knowingly—
(A) commits any violation described in subsection (a);
(B) engages in any unsafe or unsound practice in conducting the affairs of such credit union; 2 or
(C) breaches any fiduciary duty; and
(2) knowingly or recklessly causes a substantial loss to such credit union 2 or a substantial pecuniary gain or other benefit to such party by reason of such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable maximum amount determined under subsection (d) for each day during which such violation, practice, or breach continues.
(d) Maximum amounts of penalties for any violation described in subsection (c)
The maximum daily amount of any civil penalty which may be assessed pursuant to subsection (c) for any violation, practice, or breach described in such subsection is—
(1) in the case of any person other than a member bank, an amount to not exceed $1,000,000; and
(2) in the case of a member bank, an amount not to exceed the lesser of—
(A) $1,000,000; or
(B) 1 percent of the total assets of such member bank.
(e) Assessment; etc.
Any penalty imposed under subsection (a), (b), or (c) shall be assessed and collected 3 by
(1) in the case of a national bank, by the Comptroller of the Currency; and
(2) in the case of a State member bank, by the Board,
in the manner provided in subparagraphs (E), (F), (G), and (I) of section 1818(i)(2) of this title for penalties imposed (under such section) and any such assessment shall be subject to the provisions of such section.
(f) Hearing
The member bank or other person against whom any penalty is assessed under this section shall be afforded an agency hearing if such member bank or person submits a request for such hearing within 20 days after the issuance of the notice of assessment. Section 1818(h) of this title shall apply to any proceeding under this section.
(g) Disbursement
All penalties collected under authority of this paragraph shall be deposited into the Treasury.
(h) “Violate” defined
For purposes of this section, the term “violate” includes any action (alone or with another or others) for or toward causing, bringing about, participating in, counseling, or aiding or abetting a violation.
(i) Regulations
The Comptroller of the Currency and the Board shall prescribe regulations establishing such procedures as may be necessary to carry out this section.
(m) 4 Notice under this section after separation from service
The resignation, termination of employment or participation, or separation of an institution-affiliated party (within the meaning of section 1813(u) of this title) with respect to a member bank (including a separation caused by the closing of such a bank) shall not affect the jurisdiction and authority of the appropriate Federal banking agency to issue any notice and proceed under this section against any such party, if such notice is served before the end of the 6-year period beginning on the date such party ceased to be such a party with respect to such bank (whether such date occurs before, on, or after August 9, 1989).