North Dakota Code 6-03-60 – Loans to and purchases from directors, executive officers, and principal shareholders – Restrictions – Conditions – Penalty – Civil liability
At no time may any combination of loans or extensions of credit or both made by a state banking association to an officer of that association exceed the limitation on loans to one person or concern specified in section 6-03-59, federal law, or federal rule.
Attorney's Note
Under the North Dakota Code, punishments for crimes depend on the classification. In the case of this section:| Class | Prison | Fine |
|---|---|---|
| Class B misdemeanor | up to 30 days | up to $1,500 |
Terms Used In North Dakota Code 6-03-60
- Bank: means any national bank, national banking association, corporation, state bank, state banking association, or savings bank, whether organized under the laws of this state or of the United States, engaged in the business of banking. See North Dakota Code 6-01-02
- Banking: means the business of receiving deposits, making loans, discounting commercial paper, issuing drafts, traveler's checks, and similar instruments, handling and making collections, cashing checks and drafts, and buying and selling exchange. See North Dakota Code 6-01-02
- board: when used in this title includes the state banking board and the state credit union board. See North Dakota Code 6-01-03
- Commissioner: means the commissioner of financial institutions. See North Dakota Code 6-01-02
- Individual: means a human being. See North Dakota Code 1-01-49
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Person: means an individual, organization, government, political subdivision, or government agency or instrumentality. See North Dakota Code 1-01-49
- Property: includes property, real and personal. See North Dakota Code 1-01-49
- Record: means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form. See North Dakota Code 6-01-02
- Rule: includes regulation. See North Dakota Code 1-01-49
- state banking association: means any corporation organized under the laws of this state covering state banking associations, and all corporations, limited liability companies, partnerships, firms, or associations whose business in whole or in part consists of the taking of money on deposit, except national banks, trust companies, and the Bank of North Dakota. See North Dakota Code 6-01-02
- written: include "typewriting" and "typewritten" and "printing" and "printed" except in the case of signatures and when the words are used by way of contrast to typewriting and printing. See North Dakota Code 1-01-37
No director, officer, or employee of a bank shall sell to such bank, directly or indirectly, any mortgage, bond, note, stock, or other property whatsoever without first obtaining the written approval of the board of directors. The action of the board of directors in connection with the loans and discounts required under this section shall be made a matter of permanent record in the minute books of the banking association. Any shareholder, officer, or director of any banking association who knowingly shall violate the provisions of this section shall be held liable in the person’s personal and individual capacity for all loss or damage which the association or any person shall sustain in consequence thereof and shall be guilty of a class B misdemeanor. The commissioner may require, at any time, the payment or repurchase of loans, securities, or obligations herein referred to.