One-Year Post-Employment Restrictions for Senior Examiners, 69633-69641 [05-22814]

Agencies

• FEDERAL DEPOSIT INSURANCE CORPORATION
• FEDERAL RESERVE SYSTEM
• Office of the Comptroller of the Currency
• DEPARTMENT OF THE TREASURY
• Office of Thrift Supervision
• Comptroller of the Currency

[Federal Register Volume 70, Number 221 (Thursday, November 17, 2005)]
[Rules and Regulations]
[Pages 69633-69641]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-22814]


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DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Parts 4 and 19

[Docket No. 05-19]
RIN 1557-AC94

FEDERAL RESERVE SYSTEM

12 CFR Parts 263 and 264a

[Docket No. R-1230]

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Parts 308 and 336

RIN 3064-AC92

DEPARTMENT OF THE TREASURY

Office of Thrift Supervision

12 CFR Parts 507 and 509

[No. 2005-48]
RIN 1550-AB99


One-Year Post-Employment Restrictions for Senior Examiners

AGENCIES: Office of the Comptroller of the Currency (OCC), Treasury; 
Board of Governors of the Federal Reserve System (Board); Federal 
Deposit Insurance Corporation (FDIC); and Office of Thrift Supervision 
(OTS), Treasury.

ACTION: Final rule.

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SUMMARY: The OCC, Board, FDIC and OTS (the Agencies) have jointly 
adopted final rules to implement section 6303(b) of the Intelligence 
Reform and Terrorism Prevention Act of 2004 (Intelligence Reform Act), 
which imposes post-employment restrictions on senior examiners of 
depository institutions and depository institution holding companies. 
Under section 6303(b), and the Agencies' final implementing rules, a 
senior examiner employed by an Agency or a Federal Reserve Bank 
(Reserve Bank) may not knowingly accept compensation as an employee, 
officer, director, or consultant from certain depository institutions 
or depository institution holding companies he or she examined, or from 
certain related entities, for one year after the examiner leaves the 
employment or service of the Agency or Reserve Bank. If an examiner 
violates the one-year restriction, the statute requires the appropriate 
Federal banking agency to seek an order of removal and prohibition, a 
civil money penalty of up to $250,000, or both. Section 10(k) will 
become effective on December 17, 2005.

DATES: Effective Date: December 17, 2005.

FOR FURTHER INFORMATION CONTACT: 
    OCC: Mitchell Plave, Counsel, Legislative and Regulatory Activities 
Division, (202) 874-5090; Stuart Feldstein, Assistant Director, 
Legislative and Regulatory Activities Division, (202) 874-5090; or 
Barrett Aldemeyer, Senior Counsel, Administrative and Internal Law 
Division, (202) 874-4460, Office of the Comptroller of the Currency, 
250 E Street, SW., Washington, DC 20219.
    Board: Cary K. Williams, Assistant General Counsel, (202) 452-3295, 
Kieran J. Fallon, Assistant General Counsel, (202) 452-5270, Andrea 
Tokheim, Attorney, (202) 452-2300, Legal Division; William Spaniel, 
Deputy Associate Director, (202) 452-3469, or Jinai Holmes, Senior 
Financial Analyst, (202) 452-2834, Division of Banking Supervision and 
Regulation; for users of Telecommunication Devices for the Deaf (TDD) 
only, contact (202) 263-4869.
    FDIC: Robert J. Fagan, Ethics Program Manager, Legal Division, 
(202) 898-6808; Stephen P. Gaddie, Special Assistant to the Deputy 
Director, Division of Supervision and Consumer Protection, (202) 898-
6575; Richard Osterman, Senior Counsel, Legal Division, (202) 898-7028; 
and Kymberly K. Copa, Counsel, Legal Division, (202) 898-8832, Federal 
Deposit Insurance Corporation, 550 17th Street, NW., Washington, DC 
20429.
    OTS: Elizabeth Moore, Special Counsel, Litigation Division, (202) 
906-7039; or Karen Osterloh, Special Counsel, Regulations and 
Legislation Division, (202) 906-6639, Chief Counsel's Office, Office of 
Thrift Supervision, 1700 G Street, NW., Washington, DC 20552.

SUPPLEMENTARY INFORMATION:

I. Background

    Under section 6303(b) of the Intelligence Reform Act,\1\ which 
added a new section 10(k) to the Federal Deposit Insurance Act (FDI 
Act), an officer or employee of an Agency or Reserve Bank who acts as a 
``senior examiner'' for a particular depository institution may not, 
within one year after terminating employment with the relevant Agency 
or Reserve Bank, knowingly accept compensation as an officer, director, 
employee or consultant from that depository institution or any company 
(including a bank holding company or savings and loan holding company) 
that controls the depository institution.\2\ Section 10(k) imposes a 
similar post-employment restriction on an officer or employee who acts 
as the ``senior examiner'' of a particular depository institution 
holding company, but in these circumstances, the post-employment 
restrictions apply to relationships with the depository institution 
holding company and any depository institution subsidiary of the 
holding company.\3\ The restrictions in section 10(k) apply only to 
examiners who served as a senior examiner for a particular depository 
institution or holding company for two or more months during the final 
twelve months of their employment at the Agency or Reserve Bank.
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    \1\ Pub. L. 108-458, 118 Stat. 3638, 3751-53 (Dec. 17, 2004).
    \2\ For purposes of section 10(k), the term ``depository 
institution'' includes an uninsured branch or agency of a foreign 
bank, if the branch or agency is located in a state of the United 
States. See 12 U.S.C. 1820(k)(2)(A). The FDIC has made a minor 
technical change to the definition of ``depository institution'' in 
its regulation to recognize that the term may include uninsured 
branches or agencies of foreign banks for these purposes.
    \3\ For purposes of the post-employment restriction of section 
10(k), the term ``depository institution holding company'' means a 
bank holding company or a savings and loan holding company, and also 
includes, among other things, a foreign bank that has a branch, 
agency, or commercial lending company subsidiary in the United 
States.
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    If a senior examiner violates the one-year post-employment 
restrictions in section 10(k), the statute requires the appropriate 
Federal banking agency to initiate proceedings to impose an order of 
removal and prohibition or a civil money penalty, or both, on the 
former senior examiner. Congress directed each Agency to prescribe 
regulations to administer and carry out section 10(k), including rules, 
regulations or guidelines to define the scope of persons who are 
``senior examiners.'' The post-employment restrictions in section 10(k) 
are in addition to any other conflict of interest and ethics rules and 
restrictions that may apply to

[[Page 69634]]

examiners under applicable Federal law or the internal codes of conduct 
established by an Agency or a Reserve Bank.

II. Proposed Rule and Comments Received

    On August 5, 2005, the Agencies jointly published proposed rules 
that would implement the post-employment restrictions in section 
10(k).\4\ The proposed rules defined the term ``senior examiner,'' 
discussed the types of Agency and Federal Reserve examiners that would 
be considered a ``senior examiner'' in light of the examination 
programs of each Agency, addressed the nature and scope of the one-year 
post-employment restriction, and described the procedures for seeking 
penalties on senior examiners who violate section 10(k).
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    \4\ 70 FR 45323 (Aug. 5, 2005).
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    The Agencies received comments on the proposal from a trade 
association for banking institutions and an individual. The banking 
trade association endorsed the proposed rule without suggestions for 
change and, in particular, noted that the proposed definition of 
``senior examiner'' clearly and appropriately defined those individuals 
who would be subject to the statutory restriction in accordance with 
Congress' intent. The individual commenter also generally supported the 
proposed rules, but asked that the Agencies clarify the rules' 
application in certain respects. For example, the commenter asked that 
the Agencies clarify whether an examiner who performs periodic, short-
term examinations of a depository institution or depository institution 
holding company would be considered a ``senior examiner.''

III. Final Rule

    The Agencies have adopted final rules that are substantively 
identical to the proposed rules. The Agencies, however, have made 
minor, technical changes to the rules as discussed below. As required, 
the Agencies have consulted with each other to assure that the final 
rules are, to the extent possible, consistent, comparable and 
practicable, taking into account the differences in the supervisory 
programs utilized by the Agencies for the supervision of depository 
institutions and depository institution holding companies.\5\
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    \5\ 12 U.S.C. 1820(k)(4)(B).
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A. Definition of ``Senior Examiner''

    The post-employment restrictions in section 10(k) apply only to an 
officer or employee of an Agency or Reserve Bank who serves as the 
``senior examiner'' (or in a functionally equivalent position) of a 
particular depository institution or depository institution holding 
company and who, in this capacity, has ``continuing, broad 
responsibility for the examination (or inspection) of that depository 
institution or depository institution holding company'' on behalf of 
the relevant Agency or Reserve Bank.\6\ The final rules, like the 
proposed rules, provide that an officer or employee of an Agency or a 
Reserve Bank will be considered the ``senior examiner'' for a 
particular depository institution or depository institution holding 
company if:
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    \6\ Id. Sec.  1820(k)(1)(B).
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     The individual has been authorized by the relevant Agency 
to conduct examinations or inspections on behalf of the Agency; \7\
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    \7\ The Agencies have modified the proposed rules to refer to 
individuals who have been ``authorized'' to conduct examinations, 
rather than ``commissioned'' or ``designated'' to conduct 
examinations, to reflect the fact that some individuals authorized 
to conduct examinations of depository institutions or holding 
companies may be credentialed to conduct such examinations, but not 
yet formally be ``commissioned'' to do so.
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     The relevant Agency or Reserve Bank has assigned the 
individual continuing, broad, and lead responsibility for examining or 
inspecting the depository institution or holding company; and
     The individual's responsibilities for the depository 
institution or holding company represent a substantial portion of the 
individual's assigned responsibilities and require the individual to 
routinely interact with officers or employees of the institution, 
holding company, or its affiliates.
    To be considered a ``senior examiner,'' an officer or employee must 
meet each of the criteria listed above. Thus, if a substantial portion 
of an examiner's responsibilities involve conducting or leading a 
targeted examination (such as a review of an institution's credit risk 
management, information systems or internal audit functions), but the 
examiner does not have broad and lead responsibility for the Agency's 
or Reserve Bank's overall examination program with respect to the 
institution, the examiner would not be considered a ``senior examiner'' 
with respect to the institution. Such an examiner is not likely to 
develop the type and degree of relationship with any one institution 
that the post-employment restriction was designed to address. In 
addition, the final rules would not cover an examiner who performs only 
periodic, short-term examinations of a depository institution or 
depository institution holding company and who does not have ongoing, 
continuing responsibility for the institution or holding company. 
Similarly, an examiner who divides his or her time across a portfolio 
of depository institutions or holding companies, each of which does not 
represent a substantial portion of the examiner's responsibilities, 
also would not be considered a ``senior examiner.''
    To be a ``senior examiner,'' the examiner also must have 
``continuing'' responsibility for the relevant Agency's or Reserve 
Bank's supervisory program with respect to the particular depository 
institution or depository institution holding company. The Agencies 
believe that an examiner would have ``continuing'' responsibility for 
an institution or holding company only when the examiner's 
responsibilities for the institution or company were expected to 
continue for a sufficient period of time, for example, for at least two 
months, that would enable the examiner to develop the type and degree 
of ``meaningful,'' ``dedicated'' and ``sustained'' relationship with 
the institution or company that the statute was designed to address.\8\
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    \8\ 150 Cong. Rec. S10356 (daily ed. Oct. 4, 2004) (statement of 
Sen. Levin).
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    The Agencies believe that the definition of ``senior examiner'' 
properly applies the post-employment restrictions in section 10(k) to 
those examiners who, by reason of their position and assigned 
responsibilities, have broad responsibility for a depository 
institution or depository institution holding company and are expected 
to devote a substantial amount of their time to that institution or 
holding company on a continuing basis.
    Because the titles and roles of examiners vary among the Agencies, 
the preamble to the proposed rules described the types of examiners 
that each Agency expected would be considered a ``senior examiner'' in 
light of the structure and nature of the Agency's supervisory 
program.\9\ The trade association commenter found that these 
descriptions were very helpful, and the Agencies believe these 
descriptions accurately describe the types of examiners that may be 
considered ``senior examiners'' under the Agencies' current supervisory 
programs. To further help examiners comply with the one-year post-
employment restrictions, the Agencies intend to establish and maintain 
appropriate procedures to notify an examiner in writing if the relevant 
Agency believes the examiner's assigned responsibilities would cause 
the

[[Page 69635]]

examiner to be considered a ``senior examiner'' with respect to any 
depository institution or depository institution holding company. 
Nonetheless, the post-employment restrictions in section 10(k) and the 
final rules apply directly to senior examiners, and examiners are 
responsible for becoming familiar with and ensuring their own 
compliance with the statute. Accordingly, examiners who have questions 
concerning whether they may be considered a ``senior examiner'' for an 
institution or holding company are encouraged to contact the 
appropriate persons at their respective Agency or Reserve Bank.
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    \9\ See 70 FR 45326-45327 (August 5, 2005).
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B. One-Year Post-Employment Restrictions

    If an officer or employee of an Agency or a Reserve Bank serves as 
the senior examiner for a depository institution during two or more 
months of the individual's final twelve months of employment with the 
Agency or Reserve Bank, section 10(k) prohibits the individual from 
knowingly accepting compensation as an employee, officer, director, or 
consultant from the depository institution or any company that controls 
the depository institution (including a bank holding company or savings 
and loan holding company) for one year after leaving the employment of 
the Agency or Reserve Bank. Because the prohibition extends to 
companies that control the relevant depository institution, it would 
not prohibit the senior examiner from accepting employment with a 
subsidiary or affiliate of a bank holding company, savings and loan 
holding company, or other company that controls the depository 
institution (other than the depository institution for which the 
individual served as a senior examiner).\10\
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    \10\ The Agencies note, however, that a former senior examiner 
may not evade the post-employment restrictions in section 10(k) by 
nominally accepting employment with a company not directly covered 
by the post-employment restrictions, but then functionally serve as 
an officer, employee, director, or consultant for a depository 
institution or company that the former senior examiner would have 
been prohibited from working for directly.
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    If an officer or employee serves as the senior examiner for a 
depository institution holding company for two or more months during 
the last twelve months of his or her employment with an Agency or a 
Reserve Bank, the statute and final rule prohibit the individual from 
becoming employed by, or otherwise accepting compensation in the manner 
described above, from that holding company or any depository 
institution subsidiary of the holding company for one year after 
leaving the employment of the Agency or Reserve Bank.
    Under section 10(k), a person is deemed to be a consultant for 
purposes of the one-year post-employment restrictions only if such 
person ``directly works on matters for, or on behalf of,'' the relevant 
depository institution, depository institution holding company or other 
company.\11\ The Agencies have incorporated this rule of construction 
into the final rules. We interpret this provision to mean that a former 
senior examiner who joins a consulting or other firm may not, during 
the twelve-month post-employment ``cooling-off'' period, participate in 
any work that the firm is conducting for a depository institution or 
company that the former senior examiner would be prohibited from doing 
directly.\12\ The former senior examiner would not, however, violate 
the post-employment restrictions in section 10(k) by joining a firm 
that performs work for such an institution or company as long as the 
former senior examiner does not personally participate in any such 
work.
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    \11\ 12 U.S.C. 1820(k)(3).
    \12\ Of course, a former senior examiner who is self-employed 
similarly may not accept compensation for work performed as a 
consultant in his or her individual capacity for the relevant 
depository institution, depository institution holding company, or 
other company.
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    As provided by section 10(k), the head of each Agency may waive 
application of the statute's post-employment restrictions to a senior 
examiner on a case-by-case basis if the head of the Agency determines 
that ``granting the waiver would not affect the integrity of the 
supervisory program of [such Agency].'' \13\ The Agencies expect to 
grant waivers only in special circumstances. If an Agency grants a 
waiver to a senior examiner, the post-employment restrictions in 
section 10(k), and the associated penalties, would not apply to the 
senior examiner.
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    \13\ Id. Sec.  1820(k)(5).
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C. Penalties

    If a senior examiner violates the post-employment restrictions in 
section 10(k), the statute requires the appropriate Agency to seek one 
of the following penalties:
     An order (1) removing the individual from his or her 
position at, or prohibiting the individual from further participation 
in the affairs of, the relevant depository institution, depository 
institution holding company, or other company for a period of up to 
five years, and (2) prohibiting the individual from participating in 
the conduct of the affairs of any insured depository institution for a 
period of up to five years; or
     A civil monetary penalty of not more than $250,000.\14\
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    \14\ Id. Sec.  1820(k)(6)(A). If the appropriate Federal banking 
agency does not assess a civil monetary penalty against a senior 
examiner who violates the post-employment restrictions in section 
10(k), the Attorney General of the United States may bring a civil 
action to impose such a penalty against the senior examiner. Id.
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An Agency also has the discretion to seek both of these penalties. A 
former senior examiner who is subject to a removal and prohibition 
order under section 10(k) is also subject to paragraphs (6) and (7) of 
section 8(e) of the FDI Act, which pertain to the scope of orders 
prohibiting a person from participating in certain banking 
activities.\15\ These provisions, for example, would prohibit a former 
senior examiner, for the duration of a prohibition order issued under 
section 10(k), from participating in the affairs of any bank holding 
company or subsidiary of a bank holding company, savings and loan 
holding company or subsidiary of a savings and loan holding company, 
foreign bank that operates a branch, agency or commercial lending 
company subsidiary in the United States or any subsidiary of such a 
foreign bank, or certain other entities, such as credit unions.\16\ In 
addition, these provisions would prohibit the individual, during the 
term of the prohibition order, from accepting employment with any 
appropriate Federal financial institutions regulatory agency (as 
defined in 12 U.S.C. 1818(e)(7)(D)), and certain other Federal 
agencies. The penalties that may apply to a senior examiner under 
section 10(k) are in addition to any other administrative, civil, or 
criminal penalty that may apply.
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    \15\ Id. Sec.  1820(k)(6)(B).
    \16\ The appropriate Agency may consent to a change in the 
application of this restriction as it applies to a particular 
institution or other company, as provided in section 8(e)(7)(B) of 
the FDI Act (12 U.S.C. 1818(e)(7)(B)).
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    Under section 10(k), to obtain an order of removal or prohibition, 
an Agency must follow the rules and procedures that apply in similar 
types of proceedings against depository institutions and institution-
affiliated parties. Specifically, section 10(k) states that removal and 
prohibition proceedings must be conducted in accordance with section 
8(e)(4) of the FDI Act, which provides the individual the right to an 
administrative hearing prior to final Agency action. Section 10(k) 
further provides that an Agency seeking to impose a civil monetary 
penalty on a former senior examiner must do so either in accordance 
with

[[Page 69636]]

section 8(i) of the FDI Act, which also provides the individual the 
right to an administrative hearing prior to final Agency action, or 
through a civil action brought in an appropriate United States District 
Court.\17\
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    \17\ Id. Sec.  1820(k)(6).
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    As stated in the preamble to the proposal, the Agencies do not 
believe it is necessary to codify these procedures, which are 
adequately set forth in the statute. Accordingly, the final rules 
cross-reference the required statutory procedures. Proceedings against 
examiners for violations of the post-employment restrictions would take 
place in accordance with the Agencies' rules of practice and procedure, 
and the Agencies have amended the scope sections of their respective 
Rules of Practice and Procedure to reflect this fact.

D. Effective Date

    The Intelligence Reform Act provides that the post-employment 
restrictions imposed by section 10(k) shall become effective on 
December 17, 2005.\18\ Accordingly, section 10(k) and the final rules 
apply only to officers or employees of an Agency or Reserve Bank who 
terminate their employment with the Agency or Reserve Bank on or after 
December 17, 2005. As explained in the proposal, however, because of 
the statute's twelve-month ``look-back'' provision, an officer or 
employee who leaves an Agency or a Reserve Bank within one year of 
December 17, 2005, may be subject to the post-employment restrictions 
in section 10(k) based on his or her examination responsibilities as 
far back as December 17, 2004.
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    \18\ See section 6303(d) of the Intelligence Reform Act.
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    For example, if an Agency examiner terminates his or her employment 
with the relevant Agency on January 1, 2006, and the individual, while 
employed by the Agency, served as the ``senior examiner'' for a 
particular depository institution from May 1, 2005 to October 1, 2005, 
the individual is subject to the post-employment restrictions. Although 
the service that caused the individual to be considered a ``senior 
examiner'' occurred prior to December 17, 2005, such service occurred 
during the last twelve months of the individual's employment with the 
Agency and, accordingly, the examiner may not become employed by the 
relevant depository institution, or any company that controls the 
depository institution, until January 2, 2007. However, if in the 
foregoing example the examiner terminated his or her employment with 
the Agency prior to December 17, 2005 (the effective date of the 
statute), the employee would not be subject to the post-employment 
restrictions in section 10(k).
Regulatory Flexibility Act
    Under section 605(b) of the Regulatory Flexibility Act, 5 U.S.C. 
605(b) (RFA), each Agency certifies that the final rules will not have 
a significant economic impact on a substantial number of small 
entities. Section 10(k) and the final rules impose post-employment 
restrictions on certain senior examiners employed by an Agency or a 
Reserve Bank and do not impose any obligations or restrictions on 
banking organizations, including small banking organizations.
Executive Order 12866
    The OCC and OTS have determined that this final rulemaking is not a 
significant regulatory action under Executive Order 12866.
Unfunded Mandates Reform Act of 1995
    Under section 202 of the Unfunded Mandates Reform Act of 1995, 2 
U.S.C. 1532 (Unfunded Mandates Act), the OCC and OTS must prepare a 
budgetary impact statement before promulgating any rule likely to 
result in a Federal mandate that may result in the expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more in any one year. If a budgetary 
impact statement is required, section 205 of the Unfunded Mandates Act 
also requires the OCC and OTS to identify and consider a reasonable 
number of regulatory alternatives before promulgating the rule. The OCC 
and OTS have determined that their respective final rules will not 
result in expenditures by state, local, and tribal governments, in the 
aggregate, or by the private sector, of $100 million or more in any one 
year. Accordingly, neither the OCC nor OTS has prepared a budgetary 
impact statement or specifically addressed the regulatory alternatives 
considered.
Paperwork Reduction Act
    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
Ch. 3506; 5 CFR 1320 Appendix A.1), the Agencies reviewed the final 
rule. No collections of information pursuant to the Paperwork Reduction 
Act are contained in the final rule.
Plain Language
    Section 722 of the Gramm-Leach-Bliley Act, Public Law 106-102, 113 
Stat. 1338, 1471 (Nov. 12, 1999) requires the Federal banking agencies 
to use plain language in all proposed and final rules published after 
January 1, 2000. As noted above, commenters generally found the 
proposed rules were clear and the final rules are substantively similar 
to the proposed rules.

List of Subjects

12 CFR Part 4

    Administrative practice and procedure, Availability and release of 
information, Confidential business information, Contracting outreach 
program, Freedom of information, National banks, Organization and 
functions (government agencies), Reporting and recordkeeping 
requirements, Women and minority businesses.

12 CFR Part 19

    Administrative practice and procedure, Crime, Equal access to 
justice, Investigation, National banks, Penalties, Securities.

12 CFR Part 263

    Administrative practice and procedure, Claims, Crime, Equal access 
to justice, Lawyers, Penalties.

12 CFR Part 264a

    Conflicts of interest.

12 CFR Part 308

    Administrative practice and procedure, Bank deposit insurance, 
Claims, Crime, Equal access to justice, Investigations, Lawyers, 
Penalties.

12 CFR Part 336

    Conflict of interests.

12 CFR Part 507

    Ethics, Governmental employees, OTS employees.

12 CFR Part 509

    Administrative practice and procedure, Penalties.

Department of the Treasury

Office of the Comptroller of the Currency

12 CFR Chapter I

Authority and Issuance

0
For the reasons set forth in the preamble, the OCC amends parts 4 and 
19 of title 12 of the Code of Federal Regulations as follows:
0
1. The title of part 4 is revised to read as follows:

[[Page 69637]]

PART 4--ORGANIZATION AND FUNCTIONS, AVAILABILITY AND RELEASE OF 
INFORMATION, CONTRACTING OUTREACH PROGRAM, POST-EMPLOYMENT 
RESTRICTIONS FOR SENIOR EXAMINERS

0
2. The authority citation for part 4 is revised to read as follows:

    Authority: 12 U.S.C. 93a. Subpart A also issued under 5 U.S.C. 
552; Subpart B also issued under 5 U.S.C. 552; E.O. 12600 (3 CFR 
1987 Comp., p. 235). Subpart C also issued under 5 U.S.C. 301, 552; 
12 U.S.C. 161, 481, 482, 484(a), 1442, 1817(a)(3), 1818(u) and (v), 
1820(d)(6), 1820(k), 1821(c), 1821(o), 1821(t), 1831m, 1831p-1, 
1831o, 1867, 1951 et seq., 2601 et seq., 2801 et seq., 2901 et seq., 
3101 et seq., 3401 et seq.; 15 U.S.C. 77uu(b), 78q(c)(3); 18 U.S.C. 
641, 1905, 1906; 29 U.S.C. 1204; 31 U.S.C. 9701; 42 U.S.C. 3601; 44 
U.S.C. 3506, 3510. Subpart D also issued under 12 U.S.C. 1833e.

0
3. A new subpart E is added to part 4 to read as follows:

Subpart E--One-Year Restrictions on Post-Employment Activities of 
Senior Examiners

Sec.
4.72 Scope and purpose.
4.73 Definitions.
4.74 One-year post-employment restrictions.
4.75 Effective date; waivers.
4.76 Penalties.


Sec.  4.72  Scope and purpose.

    This subpart describes those OCC examiners who are subject to the 
post-employment restrictions set forth in section 10(k) of the Federal 
Deposit Insurance Act (FDI Act) (12 U.S.C. 1820(k)) and implements 
those restrictions for officers and employees of the OCC.


Sec.  4.73  Definitions.

    For purposes of this subpart:
    Bank holding company means any company that controls a bank (as 
provided in section 2 of the Bank Holding Company Act of 1956 (12 
U.S.C. 1841 et seq.)).
    Consultant. For purposes of this subpart, a consultant for a 
national bank, bank holding company, or other company shall include 
only an individual who works directly on matters for, or on behalf of, 
such bank, bank holding company, or other company.
    Control has the meaning given in section 2 of the Bank Holding 
Company Act (12 U.S.C. 1841(a)). For purposes of this subpart, a 
foreign bank shall be deemed to control any branch or agency of the 
foreign bank.
    Depository institution has the meaning given in section 3 of the 
FDI Act (12 U.S.C. 1813(c)). For purposes of this subpart, a depository 
institution includes an uninsured branch or agency of a foreign bank, 
if such branch or agency is located in any State.
    Federal Reserve means the Board of Governors of the Federal Reserve 
System and the Federal Reserve Banks.
    Foreign bank means any foreign bank or company described in section 
8(a) of the International Banking Act of 1978 (12 U.S.C. 3106(a)).
    Insured depository institution has the meaning given in section 3 
of the FDI Act (12 U.S.C. 1813(c)(2)).
    National bank means a national banking association or a Federal 
branch or agency of a foreign bank.
    Senior examiner. For purposes of this subpart, an officer or 
employee of the OCC is considered to be the ``senior examiner'' for a 
particular national bank if--
    (1) The officer or employee has been authorized by the OCC to 
conduct examinations on behalf of the OCC;
    (2) The officer or employee has been assigned continuing, broad, 
and lead responsibility for examining the national bank; and
    (3) The officer's or employee's responsibilities for examining the 
national bank--
    (i) Represent a substantial portion of the officer's or employee's 
assigned responsibilities; and
    (ii) Require the officer or employee to interact routinely with 
officers or employees of the national bank or its affiliates.


Sec.  4.74  One-year post-employment restrictions.

    An officer or employee of the OCC who serves as the senior examiner 
of a national bank for two or more months during the last twelve months 
of such individual's employment with the OCC may not, within one year 
after leaving the employment of the OCC, knowingly accept compensation 
as an employee, officer, director or consultant from the national bank, 
or any company (including a bank holding company) that controls the 
national bank.


Sec.  4.75  Effective date; waivers.

    The post-employment restrictions set forth in section 10(k) of the 
FDI Act and Sec.  4.74 do not apply to any officer or employee of the 
OCC, or any former officer or employee of the OCC, if--
    (a) The individual ceased to be an officer or employee of the OCC 
before December 17, 2005; or
    (b) The Comptroller of the Currency certifies, in writing and on a 
case-by-case basis, that granting the individual a waiver of the 
restrictions would not affect the integrity of the OCC's supervisory 
program.


Sec.  4.76  Penalties.

    (a) Penalties under section 10(k) of FDI Act. If a senior examiner 
of a national bank, after leaving the employment of the OCC, accepts 
compensation as an employee, officer, director, or consultant from that 
bank, or any company (including a bank holding company) that controls 
that bank, then the examiner shall, in accordance with section 10(k)(6) 
of the FDI Act, be subject to one of the following penalties--
    (1) An order--
    (i) Removing the individual from office or prohibiting the 
individual from further participation in the affairs of the relevant 
national bank, bank holding company, or other company that controls 
such institution for a period of up to five years; and
    (ii) Prohibiting the individual from participating in the affairs 
of any insured depository institution for a period of up to five years; 
or
    (2) A civil monetary penalty of not more than $250,000.
    (b) Enforcement by appropriate Federal banking agency. Violations 
of Sec.  4.74 shall be administered or enforced by the appropriate 
Federal banking agency for the depository institution or depository 
institution holding company that provided compensation to the former 
senior examiner. For purposes of this paragraph, the appropriate 
Federal banking agency for a company that is not a depository 
institution or depository institution holding company shall be the 
Federal banking agency that formerly employed the senior examiner.
    (c) Scope of prohibition orders. Any senior examiner who is subject 
to an order issued under paragraph (a) of this section shall, as 
required by 12 U.S.C. 1820(k)(6)(B), be subject to paragraphs (6) and 
(7) of section 8(e) of the FDI Act (12 U.S.C. 1818(e)(6)-(7)) in the 
same manner and to the same extent as a person subject to an order 
issued under section 8(e).
    (d) Procedures. The procedures applicable to actions under 
paragraph (a) of this section are provided in section 10(k)(6) of the 
FDI Act (12 U.S.C. 1820(k)(6)) and in 12 CFR part 19.
    (e) Remedies not exclusive. The OCC may seek both of the penalties 
described in paragraph (a) of this section. In addition, a senior 
examiner who accepts compensation as described in Sec.  4.74 may be 
subject to other administrative,

[[Page 69638]]

civil or criminal remedies or penalties as provided in law.

PART 19--RULES OF PRACTICE AND PROCEDURE

0
4. The authority citation for part 19 continues to read as follows:

    Authority: 5 U.S.C. 504, 554-557; 12 U.S.C. 93(b), 93a, 164, 
505, 1817, 1818, 1820, 1831m, 1831o, 1972, 3102, 3108(a), 3909 and 
4717; 15 U.S.C. 78(h) and (i), 78o-4(c), 78o-5, 78q-1, 78s, 78u, 
78u-2, 78u-3, and 78w; 28 U.S.C. 2461 note; 31 U.S.C. 330 and 5321; 
and 42 U.S.C. 4012a.

0
5. Section 19.1 is amended by redesignating paragraph (g) as paragraph 
(h), removing the word ``and'' at the end of the paragraph (f), and 
adding a new paragraph (g) to read as follows:


Sec.  19.1  Scope.

* * * * *
    (g) Removal, prohibition, and civil monetary penalty proceedings 
under section 10(k) of the FDI Act (12 U.S.C. 1820(k)) for violations 
of the post-employment restrictions imposed by that section; and
* * * * *

    Dated: November 14, 2005.
John C. Dugan,
Comptroller of the Currency.

Board of Governors of the Federal Reserve System

12 CFR Chapter II

Authority and Issuance

0
For the reasons set forth in the preamble, the Board is amending part 
263 and adding a new part 264a to Title 12, Chapter II, of the Code of 
Federal Regulations as follows:

PART 263--RULES OF PRACTICE FOR HEARINGS

0
1. The authority citation for part 263 continues to read as follows:

    Authority: 5 U.S.C. 504; 12 U.S.C. 248, 324, 504, 505, 1817(j), 
1818, 1828(c), 1831o, 1831p-1, 1847(b), 1847(d), 1884(b), 
1972(2)(F), 3105, 3107, 3108, 3907, 3909; 15 U.S.C. 21, 78o-4, 78o-
5, 78u-2; and 28 U.S.C. 2461 note.


0
2. Section 263.1 is amended by redesignating paragraph (g) as paragraph 
(h), removing the word ``and'' at the end of the paragraph (f), and 
adding new paragraph (g) to read as follows:


Sec.  263.1  Scope.

* * * * *
    (g) Removal, prohibition, and civil monetary penalty proceedings 
under section 10(k) of the FDI Act (12 U.S.C. 1820(k)) for violations 
of the special post-employment restrictions imposed by that section; 
and
* * * * *

0
3. New part 264a is added to read as follows:

PART 264a--POST-EMPLOYMENT RESTRICTIONS FOR SENIOR EXAMINERS

Sec.
264a.1 What is the purpose and scope of this part?
264a.2 Who is considered a senior examiner of the Federal Reserve?
264a.3 What special post-employment restrictions apply to senior 
examiners?
264a.4 When do these special restrictions become effective and may 
they be waived?
264a.5 What are the penalties for violating these special post-
employment restrictions?
264a.6 What other definitions and rules of construction apply for 
purposes of this part?

    Authority: 12 U.S.C. 1820(k).


Sec.  264a.1  What is the purpose and scope of this part?

    This part identifies those officers and employees of the Federal 
Reserve that are subject to the special post-employment restrictions 
set forth in section 10(k) of the Federal Deposit Insurance Act (FDI 
Act) and implements those restrictions as they apply to officers and 
employees of the Federal Reserve.


Sec.  264a.2  Who is considered a senior examiner of the Federal 
Reserve?

    For purposes of this part, an officer or employee of the Federal 
Reserve is considered to be the ``senior examiner'' for a particular 
state member bank, bank holding company or foreign bank if--
    (a) The officer or employee has been authorized by the Board to 
conduct examinations or inspections on behalf of the Board;
    (b) The officer or employee has been assigned continuing, broad and 
lead responsibility for examining or inspecting the state member bank, 
bank holding company or foreign bank; and
    (c) The officer's or employee's responsibilities for examining, 
inspecting and supervising the state member bank, bank holding company 
or foreign bank--
    (1) Represent a substantial portion of the officer's or employee's 
assigned responsibilities; and
    (2) Require the officer or employee to interact routinely with 
officers or employees of the state member bank, bank holding company or 
foreign bank or its affiliates.


Sec.  264a.3  What special post-employment restrictions apply to senior 
examiners?

    (a) Senior Examiners of State Member Banks. An officer or employee 
of the Federal Reserve who serves as the senior examiner of a state 
member bank for two or more months during the last twelve months of 
such individual's employment with the Federal Reserve may not, within 
one year after leaving the employment of the Federal Reserve, knowingly 
accept compensation as an employee, officer, director or consultant 
from--
    (1) The state member bank; or
    (2) Any company (including a bank holding company) that controls 
the state member bank.
    (b) Senior Examiners of Bank Holding Companies. An officer or 
employee of the Federal Reserve who serves as the senior examiner of a 
bank holding company for two or more months during the last twelve 
months of such individual's employment with the Federal Reserve may 
not, within one year of leaving the employment of the Federal Reserve, 
knowingly accept compensation as an employee, officer, director or 
consultant from--
    (1) The bank holding company; or
    (2) Any depository institution that is controlled by the bank 
holding company.
    (c) Senior Examiners of Foreign Banks. An officer or employee of 
the Federal Reserve who serves as the senior examiner of a foreign bank 
for two or more months during the last twelve months of such 
individual's employment with the Federal Reserve may not, within one 
year of leaving the employment of the Federal Reserve, knowingly accept 
compensation as an employee, officer, director or consultant from--
    (1) The foreign bank; or
    (2) Any branch or agency of the foreign bank located in the United 
States; or
    (3) Any other depository institution controlled by the foreign 
bank.


Sec.  264a.4  When do these special restrictions become effective and 
may they be waived?

    The post-employment restrictions set forth in section 10(k) of the 
FDI Act and Sec.  264a.3 do not apply to any officer or employee of the 
Federal Reserve, or any former officer or employee of the Federal 
Reserve, if--
    (a) The individual ceased to be an officer or employee of the 
Federal Reserve before December 17, 2005; or
    (b) The Chairman of the Board of Governors certifies, in writing 
and on a case-by-case basis, that granting the individual a waiver of 
the restrictions

[[Page 69639]]

would not affect the integrity of the Federal Reserve's supervisory 
program.


Sec.  264a.5  What are the penalties for violating these special post-
employment restrictions?

    (a) Penalties under section 10(k) of FDI Act.--A senior examiner of 
the Federal Reserve who, after leaving the employment of the Federal 
Reserve, violates the restrictions set forth in Sec.  264a.3 shall, in 
accordance with section 10(k)(6) of the FDI Act, be subject to one or 
both of the following penalties--
    (1) An order--
    (i) Removing the individual from office or prohibiting the 
individual from further participation in the affairs of the relevant 
state member bank, bank holding company, foreign bank or other 
depository institution or company for a period of up to five years; and
    (ii) Prohibiting the individual from participating in the affairs 
of any insured depository institution for a period of up to five years; 
and/or
    (2) A civil monetary penalty of not more than $250,000.
    (b) Imposition of penalties. The penalties described in paragraph 
(a) of this section shall be imposed by the appropriate Federal banking 
agency as determined under section 10(k)(6) of the FDI Act, which may 
be an agency other than the Federal Reserve.
    (c) Scope of prohibition orders. Any senior examiner who is subject 
to an order issued under paragraph (a) of this section shall, as 
required by section 10(k)(6)(B) of the FDI Act, be subject to 
paragraphs (6) and (7) of section 8(e) of the FDI Act in the same 
manner and to the same extent as a person subject to an order issued 
under section 8(e).
    (d) Procedures. The procedures applicable to actions under 
paragraph (a) of this section are provided in section 10(k)(6) of the 
FDI Act.
    (e) Other penalties. The penalties set forth in paragraph (a) of 
this section are not exclusive, and a senior examiner who violates the 
restrictions in Sec.  264a.3 also may be subject to other 
administrative, civil or criminal remedies or penalties as provided in 
law.


Sec.  264a.6  What other definitions and rules of construction apply 
for purposes of this part?

    For purposes of this part--
    (a) Bank holding company means any company that controls a bank (as 
provided in section 2 of the Bank Holding Company Act of 1956 (12 
U.S.C. 1841 et seq.)).
    (b) A person shall be deemed to act as a consultant for a bank or 
other company only if such person works directly on matters for, or on 
behalf of, such bank or other company.
    (c) Control has the meaning given in section 2 of the Bank Holding 
Company Act.
    (d) Depository institution has the meaning given in section 3 of 
the FDI Act and includes an uninsured branch or agency of a foreign 
bank, if such branch or agency is located in any State.
    (e) Federal Reserve means the Board of Governors of the Federal 
Reserve System and the Federal Reserve Banks.
    (f) Foreign bank means any foreign bank or company described in 
section 8(a) of the International Banking Act of 1978 (12 U.S.C. 
3106(a)).
    (g) Insured depository institution has the meaning given in section 
3 of the FDI Act.

    Dated: November 10, 2005.

    By order of the Board of Governors of the Federal Reserve 
System.
Robert deV. Frierson,
Deputy Secretary of the Board.

Federal Deposit Insurance Corporation

12 CFR Chapter III

Authority and Issuance

0
For the reasons set forth in the preamble, the FDIC amends chapter III 
of title 12 of the Code of Federal Regulations as follows:

PART 308--RULES OF PRACTICE AND PROCEDURES

0
1. The authority for part 308 continues to read as follows:

    Authority: 5 U.S.C. 504, 554-557; 12 U.S.C. 93(b), 164, 505, 
1815(e), 1817, 1818, 1820, 1828, 1829, 1829b, 1831i, 1831m(g)(4), 
1831o, 1831p-1, 1832(c), 1884(b), 1972, 3102, 3108(a), 3349, 3909, 
4717; 15 U.S.C. 78(h) and (i), 78o-4(c), 78o-5, 78q-1, 78s, 78u, 
78u-2, 78u-3, 78w, 6801(b), 6805(b)(1); 28 U.S.C. 2461 note; 31 
U.S.C. 330, 5321; 42 U.S.C. 4012a; Sec. 3100(s) Pub. L. 104-134, 110 
Stat. 1321-358.


0
2. In Sec.  308.1, redesignate paragraph (g) as paragraph (h), remove 
the word ``and'' at the end of the paragraph (f), and add a new 
paragraph (g) to read as follows:


Sec.  308.1  Scope.

* * * * *
    (g) Proceedings under section 10(k) of the FDIA (12 U.S.C. 1820(k)) 
to impose penalties for violations of the post-employment restrictions 
under that subsection; and
* * * * *

PART 336--FDIC EMPLOYEES

0
3. Subpart C is added to Part 336 to read as follows:

Subpart C--One-Year Restriction on Post-Employment Activities of 
Senior Examiners

Sec.
336.10 Purpose and scope.
336.11 Definitions.
336.12 One-year post-employment restriction.
336.13 Penalties.

    Authority: 12 U.S.C. 1819 and 1820(k).


Sec.  336.10  Purpose and scope.

    This subpart applies to officers or employees of the FDIC who are 
subject to the post-employment restrictions set forth in section 10(k) 
of the Federal Deposit Insurance Act, 12 U.S.C. 1820(k), and implements 
those restrictions as they apply to officers and employees of the FDIC.


Sec.  336.11  Definitions.

    For purposes of this subpart:
    (a) Bank holding company has the meaning given to such term in 
section 2 of the Bank Holding Company Act of 1956 (12 U.S.C. 1841(a)).
    (b) A consultant for an insured depository institution or other 
company shall include only individuals who work directly on matters 
for, or on behalf of, such institution or other company.
    (c) Control has the meaning given to such term in section 336.3(b), 
and a foreign bank shall be deemed to control any insured branch of the 
foreign bank.
    (d) Depository institution means any bank or savings association, 
including a branch of a foreign bank, if such branch is located in the 
United States.
    (e) Foreign bank means any bank or company described in section 
8(a) of the International Banking Act of 1978 (12 U.S.C. 3106(a)).
    (f) Savings and loan holding company has the meaning given to such 
term in section 10(a)(1)(D) of the Home Owners' Loan Act (12 U.S.C. 
1467a(a)(1)(D)).
    (g) A senior examiner for an insured depository institution means 
an officer or employee of the FDIC--
    (1) who has been authorized by the FDIC to conduct examinations or 
inspections of insured depository institutions on behalf of the FDIC;
    (2) who has been assigned continuing, broad, and lead 
responsibility for the examination or inspection of the institution;
    (3) who routinely interacts with officers or employees of the 
institution or its affiliates; and
    (4) whose responsibilities with respect to the institution 
represent a substantial portion of the FDIC officer or employee's 
overall responsibilities.

[[Page 69640]]

Sec.  336.12  One-year post-employment restriction.

    (a) Prohibition. An officer or employee of the FDIC who serves as a 
senior examiner of an insured depository institution for at least 2 
months during the last 12 months of that individual's employment with 
the FDIC may not, within 1 year after the termination date of his or 
her employment with the FDIC, knowingly accept compensation as an 
employee, officer, director, or consultant from--
    (1) The insured depository institution; or
    (2) Any company (including a bank holding company or savings and 
loan holding company) that controls such institution.
    (b) Waivers. The post-employment restrictions in paragraph (a) of 
this section will not apply to a senior examiner if the FDIC 
Chairperson certifies in writing and on a case-by case basis that a 
waiver of the restrictions will not affect the integrity of the FDIC's 
supervisory program.
    (c) Effective Date. The post-employment restrictions in paragraph 
(a) of this section will not apply to any officer or employee of the 
FDIC, or any former officer or employee of the FDIC, who ceased to be 
an officer or employee of the FDIC before December 17, 2005.


Sec.  336.13  Penalties.

    (a) Penalties under section 10(k) of the FDI Act. A senior examiner 
of the FDIC who violates the post-employment restrictions set forth in 
Sec.  336.12 shall be subject to the following penalties--
    (1) An order--
    (i) Removing such person from office or prohibiting such person 
from further participation in the affairs of the relevant insured 
depository institution or company (including a bank holding company or 
savings and loan holding company) that controls such institution for a 
period of up to five years, and
    (ii) Prohibiting any further participation by such person, in any 
manner, in the affairs of any insured depository institution for a 
period of up to five years; or
    (2) A civil monetary penalty of not more than $250,000; or
    (3) Both.
    (b) Enforcement by appropriate Federal banking agency of hiring 
entity. Violations of Sec.  336.12 shall be enforced by the appropriate 
Federal banking agency of the depository institution, depository 
institution holding company, or other company at which the violation 
occurred, as determined under section 10(k)(6), which may be an agency 
other than the FDIC.
    (c) Scope of prohibition orders. Any senior examiner who is subject 
to an order issued under paragraph (a)(1) of this section shall, as 
required by 12 U.S.C. 1820(k)(6)(B), be subject to paragraphs (6) and 
(7) of section 8(e) in the same manner and to the same extent as a 
person subject to an order issued under section 8(e).
    (d) Other penalties. The penalties set forth in paragraph (a) of 
this section are not exclusive, and a senior examiner who violates the 
restrictions in Sec.  336.12 may also be subject to other 
administrative, civil, or criminal remedies or penalties as provided by 
law.

    Dated at Washington, DC, this 8th day of November, 2005.

    By order of the Board of Directors.

Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.

Department of the Treasury

Office of Thrift Supervision

12 CFR Chapter V

Authority and Issuance

0
For the reasons set forth in the preamble, OTS is amending chapter V of 
title 12 of the Code of Federal Regulations as follows:
0
1. Add a new part 507 to read as follows:

PART 507--RESTRICTIONS ON POST-EMPLOYMENT ACTIVITIES OF SENIOR 
EXAMINERS

Sec.
507.1 What does this part do?
507.2 Who is a senior examiner?
507.3 What post-employment restrictions apply to senior examiners?
507.4 When will OTS waive the post-employment restrictions?
507.5 What are the penalties for violating the post-employment 
restrictions?

    Authority: 12 U.S.C. 1462a, 1463 and 1820(k).


Sec.  507.1  What does this part do?

    This part implements section 10(k) of the Federal Deposit Insurance 
Act (FDIA), which prohibits senior examiners from accepting 
compensation from certain companies following the termination of their 
employment. See 12 U.S.C. 1820(k). Except where otherwise provided, the 
terms used in this part have the meanings given in section 3 of the 
FDIA (12 U.S.C. 1813).


Sec.  507.2  Who is a senior examiner?

    An individual is a senior examiner for a particular savings 
association or savings and loan holding company if--
    (a) The individual is an officer or employee of OTS (including a 
special government employee) who has been authorized by OTS to conduct 
examinations or inspections of savings associations or savings and loan 
holding companies;
    (b) The individual has been assigned continuing, broad and lead 
responsibility for the examination or inspection of that savings 
association or savings and loan holding company; and
    (c) The individual's responsibilities for examining, inspecting, or 
supervising that savings association or savings and loan holding 
company:
    (1) Represent a substantial portion of the individual's assigned 
responsibilities at OTS; and
    (2) Require the individual to interact on a routine basis with 
officers and employees of the savings association, savings and loan 
holding company, or its affiliates.


Sec.  507.3  What post-employment restrictions apply to senior 
examiners?

    (a) Prohibition. (1) Senior examiner of savings association. An 
individual who serves as a senior examiner of a savings association for 
two or more of the last 12 months of his or her employment with OTS may 
not, within one year after the termination date of his or her 
employment with OTS, knowingly accept compensation as an employee, 
officer, director, or consultant from--
    (i) The savings association; or
    (ii) A savings and loan holding company, bank holding company, or 
any other company that controls the savings association.
    (2) Senior examiner of a savings and loan holding company. An 
individual who serves as a senior examiner of a savings and loan 
holding company for two or more of the last 12 months of his or her 
employment with OTS may not, within one year after the termination date 
of his or her employment with OTS, knowingly accept compensation as an 
employee, officer, director, or consultant from--
    (i) The savings and loan holding company; or
    (ii) Any depository institution that is controlled by the savings 
and loan holding company.
    (b) Effective date. The post-employment restrictions in paragraph 
(a) of this section do not apply to any senior examiner who terminated 
his employment at OTS before December 17, 2005.
    (c) Definitions. For the purposes of this section--
    (1) Consultant. An individual acts as a consultant for a savings 
association or other company only if he or she directly works on 
matters for, or on behalf of, the savings association or company.

[[Page 69641]]

    (2) Control. Control has the same meaning given in part 574 of this 
chapter.


Sec.  507.4  When will OTS waive the post-employment restrictions?

    The post-employment restriction in Sec.  507.3 of this part will 
not apply to a senior examiner if the Director certifies in writing and 
on a case-by-case basis that a waiver of the restriction will not 
affect the integrity of OTS's supervisory program.


Sec.  507.5  What are the penalties for violating the post-employment 
restrictions?

    (a) Penalties. A senior examiner who violates Sec.  507.3 shall, in 
accordance with 12 U.S.C. 1820(k)(6), be subject to one or both of the 
following penalties:
    (1) An order--
    (i) Removing the person from office or prohibiting the person from 
further participating in the conduct of the affairs of the relevant 
depository institution, savings and loan holding company, bank holding 
company or other company for up to five years, and
    (ii) Prohibiting the person from participating in the affairs of 
any insured depository institution for up to five years.
    (2) A civil money penalty not to exceed $250,000.
    (b) Scope of prohibition orders. Any senior examiner who is subject 
to an order issued under paragraph (a)(1) of this section shall be 
subject to 12 U.S. C. 1818(e)(6) and (7) in the same manner and to the 
same extent as a person subject to an order issued under 12 U.S.C. 
1818(e).
    (c) Procedures. 12 U.S.C. 1820(k) describes the procedures that are 
applicable to actions under paragraph (a) of this section and the 
appropriate Federal banking agency authorized to take the action, which 
may be an agency other than OTS. Where OTS is the appropriate Federal 
banking agency, it will conduct administrative proceedings under 12 CFR 
part 509.
    (d) Other penalties. The penalties under this section are not 
exclusive. A senior examiner who violates the restriction in Sec.  
507.3 may also be subject to other administrative, civil, or criminal 
remedy or penalty as provided by law.

PART 509--RULES OF PRACTICE AND PROCEDURES IN ADJUDICATORY 
PROCEEDINGS

0
2. The authority citation for part 509 is revised to read as follows:

    Authority: 5 U.S.C. 504, 554-557; 12 U.S.C. 1464, 1467, 1467a, 
1468, 1817(j), 1818, 1820(k), 3349. 4717; 15 U.S.C. 78(l); 78o-5, 
78u-2; 28 U.S.C. 2461 note; 31 U.S.C. 5321; 42 U.S.C. 4012a.


0
3. In Sec.  509.1, redesignate paragraph (g) as paragraph (h); remove 
the word ``and'' at the end of paragraph (f); and add a new paragraph 
(g) to read as follows:


Sec.  509.1  Scope.

* * * * *
    (g) Proceedings under section 10(k) of the FDIA (12 U.S.C. 1820(k)) 
to impose penalties on senior examiners for violation of post-
employment prohibitions; and
* * * * *

    Dated: November 7, 2005.

Office of Thrift Supervision.
John M. Reich,
Director.
[FR Doc. 05-22814 Filed 11-16-05; 8:45 am]
BILLING CODE 4810-33-P; 6210-01-P; 6714-01-P; 6720-01-P