Removal of Transferred OTS Regulations Regarding Rules of Practice and Procedure and Amendments to FDIC Rules and Regulations, 5009-5015 [2015-01327]

Agencies

• FEDERAL DEPOSIT INSURANCE CORPORATION

[Federal Register Volume 80, Number 20 (Friday, January 30, 2015)]
[Rules and Regulations]
[Pages 5009-5015]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-01327]


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FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Parts 308 and 390

RIN 3064-AE08


Removal of Transferred OTS Regulations Regarding Rules of 
Practice and Procedure and Amendments to FDIC Rules and Regulations

AGENCY: Federal Deposit Insurance Corporation.

ACTION: Final rule.

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SUMMARY: The Federal Deposit Insurance Corporation (FDIC) is adopting a 
final rule to rescind and remove from the Code of Federal Regulations 
rules transferred to the FDIC following the dissolution of the former 
Office of Thrift Supervision (OTS) in connection with the 
implementation of applicable provisions of Title III of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). The 
rule also makes conforming amendments to FDIC regulations.

DATES: The Final Rule is effective on March 2, 2015.

FOR FURTHER INFORMATION CONTACT: Scott Patterson, Senior Review 
Examiner, Division of Risk Management Supervision, (202) 898-6953, 
Andrea Winkler, Supervisory Counsel, Legal Division, (202) 898-3727; 
Heather Walters, Counsel, Legal Division, (202) 898-6729.

SUPPLEMENTARY INFORMATION:

I. Background

    Beginning July 21, 2011, the transfer date established by section 
311 of the Dodd-Frank Act, 12 U.S.C. 5411, the powers, duties and 
functions of the former OTS were divided among the FDIC as to State 
savings associations, the Office of the Comptroller of the Currency 
(OCC) as to Federal savings associations, and the Board of Governors of 
the Federal Reserve System as to savings and loan holding companies.\1\ 
Section 316(b) of the Dodd-Frank Act, 12 U.S.C. 5414(b), provides the 
manner of treatment for all orders, resolutions, determinations, 
regulations, and advisory materials that had been issued, made, 
prescribed, or allowed to become effective by the OTS. The section 
provides that if such regulatory issuances were in effect on the day 
before the transfer date, they continue in effect and are enforceable 
by or against the appropriate successor agency until they are modified, 
terminated, set aside, or superseded in accordance with applicable law 
by such successor agency, by any court of competent jurisdiction, or by 
operation of law.
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    \1\ Dodd-Frank Wall Street Reform and Consumer Protection Act, 
Public Law 111-203, 124 Stat. 1376 (2010).
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    The Dodd-Frank Act directed the FDIC and OCC to consult with one 
another and to publish a list of continued OTS regulations to be 
enforced by each respective agency that would continue to remain in 
effect until the appropriate successor agency modified or removed the 
regulations in accordance with the applicable laws. The list was 
published by the FDIC and OCC as a Joint Notice in the Federal Register 
on July 6, 2011, and shortly thereafter, the FDIC published its

[[Page 5010]]

transferred OTS regulations as new FDIC regulations in 12 CFR parts 390 
and 391. When it republished the transferred OTS regulations as new 
FDIC regulations, the FDIC specifically noted that its staff would 
evaluate the transferred OTS rules and might later recommend 
incorporating the transferred OTS regulations into other FDIC rules, 
amending them, or rescinding them, as appropriate.
    Further, section 312(c) of the Dodd-Frank Act amended the 
definition of ``appropriate Federal banking agency'' contained in 
section 3(q) of the FDI Act, to add State savings associations to the 
list of entities for which the FDIC is designated the ``appropriate 
Federal banking agency.'' As a result, when the FDIC acts as the 
designated ``appropriate Federal banking agency'' (or under similar 
terminology) for State savings associations, as it does today, it has 
the authority to issue, modify, and rescind regulations involving such 
associations as well as for State nonmember banks and insured branches 
of foreign banks.\2\
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    \2\ 12 U.S.C. 5412(b)(2)(C).
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II. Proposed Rule

    On April 21, 2014, the FDIC published an NPR regarding the removal 
of certain subparts from 12 CFR part 390 in an effort to streamline 
regulations for all FDIC-supervised institutions and eliminate 
duplicative regulations. The NPR also proposed minor technical changes 
to 12 CFR part 308 to conform the existing FDIC regulations to 
accommodate State savings associations, add jurisdiction for new 
statutes, and reflect internal organization changes. The specific 
changes are set forth below in Section IV.

A. Removal of Part 390, subpart C (Former OTS 12 CFR Part 509, subparts 
A and B)

    Part 390, subpart C governs the rules and procedures applicable to 
administrative enforcement actions for State savings associations and 
their institution-affiliated parties (IAPs).\3\ The former OTS rule was 
transferred to the FDIC with only nominal changes. As discussed in the 
Proposed Rule, the FDIC carefully reviewed part 390, subpart C, and 
compared it with part 308, subparts A and B, an FDIC regulation that 
existed before the transfer of part 390, subpart C, and that continues 
to remain in effect today. Like the transferred rule, part 308, 
subparts A and B govern the rules and procedures applicable to 
administrative enforcement proceedings for State nonmember banks and 
their IAPs.\4\ Although the two rules were substantively the same, the 
FDIC noted some distinctions and technical differences between the 
transferred OTS rule and part 308.\5\
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    \3\ 79 FR 22056 (Apr. 21, 2014).
    \4\ Id. at 22057.
    \5\ Id.
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B. Removal of Part 390, Subpart E (Former OTS 12 CFR Part 513)

    Part 390, subpart E governs the rules of practice before the FDIC 
and requirements for legal counsel.\6\ The FDIC carefully reviewed the 
transferred rule, part 390, subpart E, and compared it with part 308, 
subpart C, an FDIC regulation that existed before the transfer of part 
390, subpart E and that continues to remain in effect today. Like the 
transferred rule, part 308, subpart C governs the suspension and 
debarment rules for legal counsel. Although the two rules were 
substantively the same, the FDIC noted some distinctions and technical 
differences between the transferred OTS rule and part 308.
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    \6\ Id. at 22058.
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C. Removal of Part 390, Subpart D (Former OTS 12 CFR Part 512)

    Part 390, subpart D sets the rules for investigations and formal 
examination proceedings. The FDIC carefully reviewed the transferred 
rule, part 390, subpart D, and compared it with part 308, subpart K, an 
FDIC regulation that existed before the transfer of part 390, subpart D 
and that continues to remain in effect today. Like the transferred 
rule, part 308, subpart K sets the rules for investigative proceedings. 
Although the two rules were substantively the same, the FDIC noted some 
distinctions and technical differences between the transferred OTS rule 
and part 308. The Final Rule conforms the rules and procedures for 
State savings associations and provides investigative authority for 
violations of certain statutes now enforced by the FDIC.

D. Removal of Part 390, Subpart B (Former OTS 12 CFR 508)

    Part 390, subpart B sets the rules for removals, suspensions, and 
prohibitions where a crime is charged. The FDIC carefully reviewed the 
transferred rule, part 390, subpart B, and compared it with part 308, 
subpart N, an FDIC regulation that existed before the transfer of part 
390, subpart B and that continues to remain in effect today. Like the 
transferred rule, part 308, subpart N sets the rules for proceedings 
relating to suspension, removal, and prohibition where a felony is 
charged. Although the two rules were substantively the same, the FDIC 
noted some distinctions and technical differences between the 
transferred OTS rule and part 308. The Final Rule conforms the rules 
and procedures for State savings associations.

III. Comments

    The FDIC issued the NPR with a 60-day comment period that closed on 
June 20, 2014. The FDIC received no comments on its Proposed Rule, and 
consequently the Final Rule is adopted as proposed without any changes.

IV. Explanation of the Final Rule

    As discussed in the NPR, part 390, subparts B, C, D, and E are 
substantively similar to part 308, subparts A, B, C, K, and N. 
Conforming the rules and procedures for all FDIC-supervised 
institutions will streamline the FDIC's rules and eliminate unnecessary 
regulations. To that effect, the Final Rule removes and rescinds 12 CFR 
part 390, subparts B, C, D, and E in their entirety. The Final Rule 
also makes minor technical changes to part 308, subparts A, B, C, K, 
and N to conform the FDIC's rules and accommodate State savings 
associations, as described below.

A. Technical Amendments to Part 308, Subpart A--Uniform Rules of 
Practice and Procedure, and Subpart B--General Rules of Procedure

    The Final Rule addresses the key difference between part 308, 
subparts A and B, and part 390, subpart C, which relates to the scope 
of discovery in administrative enforcement proceedings. Specifically, 
the FDIC's rules at part 308, subparts A and B restrict discovery to 
document discovery only. State savings associations, for which the FDIC 
is the primary federal regulator (PFR), will now follow the same rules 
as other FDIC-supervised institutions. Additionally, the changes to 
part 308, subparts A and B include new jurisdictional language to 
ensure that the FDIC can take the necessary enforcement actions such as 
the assessment of civil money penalties against State savings 
associations.

B. Technical Amendments to Part 308, Subpart C--Rules of Practice 
Before the FDIC and Standards of Conduct

    The Final Rule adds language to the suspension and debarment 
section to require attorneys who appear before the FDIC as legal 
counsel to disclose any professional disciplinary actions to the Board.

[[Page 5011]]

C. Technical Amendments to Part 308, Subpart K--Procedures Applicable 
to Investigations Pursuant to Section 10(c) of the FDIA

    The Final Rule adds language to provide the FDIC with the necessary 
investigative powers under certain statutes that were previously 
enforced by the OTS against State savings associations such as section 
5(d)(1)(B) of Home Owners' Loan Act of 1933, 12 U.S.C. 1464(c) 
(``HOLA''). There are also conforming amendments to make subpart K 
procedures applicable to all enforcement investigations conducted by 
FDIC. The Final Rule also updates the language of the subpart to 
reflect internal organizational changes to the FDIC, as well as 
clarifying the behavioral standards for those participating in an 
official investigation. Finally, the Final Rule clarifies who may be 
present during sworn testimony and how a witness requests transcripts 
of that testimony.

D. Technical Amendments to Part 308, Subpart N--Rules and Procedures 
Applicable to Proceedings Relating to Suspension, Removal, and 
Prohibition Where a Felony is Charged

    The Final Rule adds language to include State savings associations, 
provides guidance on immediate compliance with the suspension or 
prohibition proceeding, and clarifies that the IAP has the burden of 
proof to show that his or her continued participation in the industry 
does not pose a threat to, or public confidence in insured 
institutions.

V. Administrative Law Matters

A. The Paperwork Reduction Act

    The Final Rule rescinds and removes from FDIC regulations part 390, 
subparts B, C, D, and E. Further, with regard to part 308, the Final 
Rule makes minor amendments to subparts A, B, C, K, and N. The 
practical effect of these technical amendments to rules and procedures 
will not involve any new--or revisions to current--collections of 
information under the PRA.

B. The Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et. seq., 
generally requires an agency to consider whether a final rule will have 
a significant economic impact on a substantial number of small entities 
(defined in regulations promulgated by the Small Business 
Administration to include banking organizations with total assets of 
less than or equal to $550 million).\7\ Pursuant to section 605(b) of 
the RFA, a final regulatory flexibility analysis is not required if the 
agency certifies that the rule will not have a significant economic 
impact on a substantial number of small entities, and publishes its 
certification and a short explanatory statement in the Federal Register 
together with the rule. For the reasons provided below, the FDIC 
certifies that the Final Rule will not have a significant economic 
impact on a substantial number of small entities. Accordingly, a 
regulatory flexibility analysis is not required.
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    \7\ 5 U.S.C. 601 et seq.
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    As discussed previously, part 390, subparts B, C, D, and E were 
transferred from OTS's rules and procedures governing administrative 
enforcement proceedings and all State savings associations were 
required to comply with them. Because these subparts are redundant of 
existing part 308 of the FDIC's rules, the Final Rule rescinds and 
removes part 390, subparts B, C, D, and E. As a result, all FDIC-
supervised institutions--including State savings associations--must 
comply with Part 308 if they are subject to administrative enforcement 
proceedings. Consequently, today's Final Rule will have no significant 
economic impact on any State savings association.

C. Small Business Regulatory Enforcement Fairness Act

    The Office of Management and Budget has determined that the Final 
Rule is not a ``major rule'' within the meaning of the Small Business 
Regulatory Enforcement Fairness Act of 1996 (SBREFA), 5 U.S.C. 801 et 
seq.

D. Plain Language

    Section 722 of the Gramm-Leach-Bliley Act, codified at 12 U.S.C. 
4809, requires each Federal banking agency to use plain language in all 
of its proposed and final rules published after January 1, 2000. In the 
NPR, the FDIC invited comments on whether the Proposed Rule was clearly 
stated and effectively organized, and how the FDIC might make it easier 
to understand. Although the FDIC did not receive any comments, the FDIC 
sought to present the Final Rule in a simple and straightforward 
manner.

E. The Economic Growth and Regulatory Paperwork Reduction Act

    Under section 2222 of the Economic Growth and Regulatory Paperwork 
Reduction Act of 1996 (EGRPRA), the FDIC is required to review all of 
its regulations, at least once every 10 years, in order to identify any 
outdated or otherwise unnecessary regulations imposed on insured 
institutions.\8\ The FDIC's EGRPRA review is ongoing and is expected to 
be completed by 2016. The NPR solicited comments on whether the 
proposed rescission of part 390, subparts B, C, D, and E and technical 
amendments to part 308, subparts A, B, C, K and N would impose any 
outdated or unnecessary regulatory requirements on insured depository 
institutions. No comments on this issue were received. Upon review, the 
FDIC does not believe that part 308, as amended by the Final Rule, 
imposes any outdated or unnecessary regulatory requirements on any 
insured depository institutions.
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    \8\ Public Law 104-208 (Sept. 30, 1996).
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List of Subjects

12 CFR Part 390

    Administrative practice and procedure, Banks, Banking, Claims, 
Investigations lawyers, Penalties, State nonmember banks, State savings 
associations, and Standards of conduct.

12 CFR Part 308

    Administrative practice and procedure, Banks, Banking, Claims, 
Investigations lawyers, Penalties, State nonmember banks, State savings 
associations, and Standards of conduct.

Authority and Issuance

    For the reasons stated in the preamble, the Board of Directors of 
the Federal Deposit Insurance Corporation amends parts 308 and 390 of 
title 12 of the Code of Federal Regulations as set forth below:

PART 308--RULES OF PRACTICE AND PROCEDURE

0
1. The authority citation for part 308 is revised to read as follows:

    Authority: 5 U.S.C. 504, 554-557; 12 U.S.C. 93(b), 164, 505, 
1464, 1467(d), 1467a, 1468, 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, 5412(b)(2)(C), and 5414(b)(3); 15 
U.S.C. 78 (h) and (i), 78o(c)(4), 78o-4(c), 78o-5, 78q-1, 78s 78u, 
78u-2, 78u-3 and 78w, 6801(b), 6805(b)(1); 28 U.S.C. 2461 note; 31 
U.S.C. 330, 5321; 42 U.S.C. 4012a; sec. 31001(s), Pub. L. 104-134, 
110 Stat. 1321-358, Pub. L. 109-351, and Pub. L. 111-203, 124 Stat. 
1376.

Subpart A--Uniform Rules of Practice and Procedure

0
2. Section 308.1 is amended by revising paragraphs (e) introductory 
text and (e)(1) and (9), and adding paragraphs (e)(12) through (14), to 
read as follows:

[[Page 5012]]

Sec.  308.1  Scope.

* * * * *
    (e) Assessment of civil money penalties by the FDIC against 
institutions, institution-affiliated parties, and certain other persons 
for which it is the appropriate regulatory agency for any violation of:
    (1) Sections 22(h) and 23 of the Federal Reserve Act (FRA), or any 
regulation issued thereunder, and certain unsafe or unsound practices 
or breaches of fiduciary duty, pursuant to 12 U.S.C. 1828(j) or 12 
U.S.C. 1468;
* * * * *
    (9) The terms of any final or temporary order issued under section 
8 of the FDIA or of any written agreement executed by the FDIC or the 
former Office of Thrift Supervision (OTS), the terms of any condition 
imposed in writing by the FDIC in connection with the grant of an 
application or request, certain unsafe or unsound practices or breaches 
of fiduciary duty, or any law or regulation not otherwise provided 
herein pursuant to 12 U.S.C. 1818(i)(2);
* * * * *
    (12) Certain provisions of Section 5 of the Home Owners' Loan Act 
(HOLA) or any regulation or order issued thereunder, pursuant to 12 
U.S.C. 1464(d)(1), (5)-(8), (s), and (v);
    (13) Section 9 of the HOLA or any regulation or order issued 
thereunder, pursuant to 12 U.S.C. 1467(d);
    (14) Section 10 of HOLA, pursuant to 12 U.S.C. 1467a(a)(2)(D), (g), 
(i)(2)-(4) and (r); and
* * * * *

0
2a. Section 308.3 is amended as follows:
0
a. Revise paragraphs (e) and (j)(3).
0
b. Redesignate paragraphs (k) through (r) as paragraphs (l) through (s) 
and revise newly redesignated paragraphs (l) through (s).
0
c. Add new paragraph (l).
    The revisions read as follows:


Sec.  308.3  Definitions.

* * * * *
    (e) Designee of the Board of Directors means officers or officials 
of the Federal Deposit Insurance Corporation acting pursuant to 
authority delegated by the Board of Directors.
* * * * *
    (j) Institution includes:
* * * * *
    (3) Any savings association as that term is defined in section 3(b) 
of the FDIA (12 U.S.C. 1813(b)), any savings and loan holding company 
or any subsidiary thereof (other than a bank) as those terms are 
defined in section 10(a) of the HOLA (12 U.S.C. 1467a(a));
* * * * *
    (l) Investigation means any investigation conducted pursuant to 
section 10(c) of the FDIA or pursuant to section 5(d)(1)(B) of HOLA (12 
U.S.C. 1464(d)(1)(B)).
    (m) Local Rules means those rules promulgated by the FDIC in those 
subparts of this part other than subpart A.
    (n) Office of Financial Institution Adjudication (OFIA) means the 
executive body charged with overseeing the administration of 
administrative enforcement proceedings of the Office of the Comptroller 
of the Currency (OCC), the Board of Governors of the Federal Reserve 
Board (FRB), the FDIC, and the National Credit Union Administration 
(NCUA).
    (o) Party means the FDIC and any person named as a party in any 
notice.
    (p) Person means an individual, sole proprietor, partnership, 
corporation, unincorporated association, trust, joint venture, pool, 
syndicate, agency or other entity or organization, including an 
institution as defined in paragraph (j) of this section.
    (q) Respondent means any party other than the FDIC.
    (r) Uniform Rules means those rules in subpart A of this part that 
pertain to the types of formal administrative enforcement actions set 
forth at Sec.  308.1 and as specified in subparts B through P of this 
part.
    (s) Violation includes any action (alone or with another or others) 
for or toward causing, bringing about, participating in, counseling, or 
aiding or abetting a violation.

0
3. Section 308.25 is amended by revising paragraph (b) to read as 
follows:


Sec.  308.25  Request for document discovery from parties.

* * * * *
    (b) Production or copying. The request must specify a reasonable 
time, place, and manner for production and performing any related acts. 
In lieu of inspecting the documents, the requesting party may specify 
that all or some of the responsive documents be copied and the copies 
delivered to the requesting party. If copying of fewer than 250 pages 
is requested, the party to whom the request is addressed shall bear the 
cost of copying and shipping charges. If a party requests 250 pages or 
more of copying, the requesting party shall pay for the copying and 
shipping charges. Copying charges are the current per page copying rate 
imposed by 12 CFR part 309 implementing the Freedom of Information Act 
(5 U.S.C. 552). The party to whom the request is addressed may require 
payment in advance before producing the documents.
* * * * *

Subpart B--General Rules of Procedure

0
4. Section 308.101 is amended by revising paragraph (a) and adding 
paragraph (d) to read as follows:


Sec.  308.101  Scope of Local Rules.

    (a) Subparts B and C of the Local Rules prescribe rules of practice 
and procedure to be followed in the administrative enforcement 
proceedings initiated by the FDIC as set forth in Sec.  308.1 of the 
Uniform Rules.
* * * * *
    (d) Subparts A, B, and C of this part prescribe the rules of 
practice and procedure to applicable to adjudicatory proceedings as to 
which hearings on the record are provided for by the assessment of 
civil money penalties by the FDIC against institutions, institution-
affiliated parties, and certain other persons for which it is the 
appropriate regulatory agency for any violation of section 15(c)(4) of 
the Exchange Act (15 U.S.C. 78o(c)(4)).

0
5. Section 308.107 is amended by revising paragraph (a) to read as 
follows:


Sec.  308.107  Document discovery.

    (a) Parties to proceedings set forth at Sec.  308.1 of the Uniform 
Rules and as provided in the Local Rules may obtain discovery only 
through the production of documents. No other form of discovery shall 
be allowed.
* * * * *

Subpart C--Rules of Practice Before the FDIC and Standards of 
Conduct

0
6. Section 308.109 is amended by revising paragraphs (b)(1) and (2) to 
read as follows:


Sec.  308.109  Suspension and disbarment.

* * * * *
    (b) Mandatory suspension and disbarment. (1) Any counsel who has 
been and remains suspended or disbarred by a court of the United States 
or of any state, territory, district, commonwealth, or possession; or 
any person who has been and remains suspended or barred from practice 
before the OCC, Board of Governors, the OTS, the NCUA, the Securities 
and Exchange Commission, or the Commodity Futures Trading Commission; 
or any person who has been, within the last ten years, convicted of a 
felony, or of a misdemeanor involving moral turpitude, shall be 
suspended

[[Page 5013]]

automatically from appearing or practicing before the FDIC. A 
disbarment, suspension, or conviction within the meaning of this 
paragraph (b) shall be deemed to have occurred when the disbarring, 
suspending, or convicting agency or tribunal enters its judgment or 
order, regardless of whether an appeal is pending or could be taken, 
and includes a judgment or an order on a plea of nolo contendere or on 
consent, regardless of whether a violation is admitted in the consent.
    (2) Any person appearing or practicing before the FDIC who is the 
subject of an order, judgment, decree, or finding of the types set 
forth in paragraph (b)(1) of this section shall promptly file with the 
Executive Secretary a copy thereof, together with any related opinion 
or statement of the agency or tribunal involved. Any person who fails 
to so file a copy of the order, judgment, decree, or finding within 30 
days after the entry of the order, judgment, decree, or finding or the 
date such person initiates practice before the FDIC, for that reason 
alone may be disqualified from practicing before the FDIC until such 
time as the appropriate filing shall be made. Failure to file any such 
paper shall not impair the operation of any other provision of this 
section.
* * * * *

Subpart K--Procedures Applicable to Investigations Pursuant to 
Section 10(c) of the FDIA and Section 5(d)(1)(B) of HOLA

0
7. Section 308.144 is revised to read as follows:


Sec.  308.144  Scope.

    The procedures of this subpart shall be followed when an 
investigation is instituted and conducted in connection with any open 
or failed insured depository institution, any institutions making 
application to become insured depository institutions, and affiliates 
thereof, or with other types of investigations to determine compliance 
with applicable law and regulations, pursuant to section 10(c) of the 
FDIA (12 U.S.C. 1820(c)) or section 5(d)(1)(B) of HOLA (12 U.S.C. 
1464(d)(1)(B)). The Uniform Rules and subpart B of the Local Rules 
shall not apply to investigations under this subpart.

0
8. Section 308.145 is revised to read as follows:


Sec.  308.145  Conduct of investigation.

    An investigation shall be initiated only upon issuance of an order 
by the Board of Directors; or by the General Counsel, the Director of 
the Division of Risk Management Supervision, the Director of the 
Division of Depositor and Consumer Protection, or their respective 
designees. The order shall indicate the purpose of the investigation 
and designate FDIC's representative(s) to direct the conduct of the 
investigation. Upon application and for good cause shown, the persons 
who issue the order of investigation may limit, quash, modify, or 
withdraw it. Upon the conclusion of the investigation, an order of 
termination of the investigation shall be issued by the persons issuing 
the order of investigation.

0
9. Section 308.146 is revised to read as follows:


Sec.  308.146  Powers of person conducting investigation.

    The person designated to conduct the investigation shall have the 
power, among other things, to administer oaths and affirmations, to 
take and preserve testimony under oath, to issue subpoenas and 
subpoenas duces tecum and to apply for their enforcement to the United 
States District Court for the judicial district or the United States 
court in any territory in which the main office of the bank, 
institution, or affiliate is located or in which the witness resides or 
conducts business. The person conducting the investigation may obtain 
the assistance of counsel or others from both within and outside the 
FDIC. The persons who issue the order of investigation may limit, 
quash, or modify any subpoena or subpoena duces tecum, upon application 
and for good cause shown. The person conducting an investigation may 
report to the Board of Directors any instance where any attorney has 
engaged in contemptuous, dilatory, obstructionist, or contumacious 
conduct or has otherwise violated any provision of this part during the 
course of an investigation. The Board of Directors, upon motion of the 
person conducting the investigation, or on its own motion, may make a 
finding of contempt and may then summarily suspend, without a hearing, 
any attorney representing a witness from further participation in the 
investigation.

0
10. Section 308.147 is revised to read as follows:


Sec.  308.147  Investigations confidential.

    Investigations shall be confidential. Information and documents 
obtained by the FDIC in the course of such investigations shall not be 
disclosed, except as provided in part 309 of this chapter and as 
otherwise required by law.

0
11. Section 308.148 is amended by revising the introductory text and 
paragraph (c) to read as follows:


Sec.  308.148  Rights of witnesses.

    In an investigation:
* * * * *
    (c) All persons testifying shall be sequestered. Such persons and 
their counsel shall not be present during the testimony of any other 
person, unless permitted in the discretion of the person conducting the 
investigation. Neither attorney(s) for the institution that is the 
subject of the investigation, nor attorney(s) for any other interested 
persons, shall have any right to be present during the testimony of any 
witness not personally represented by such attorney;
* * * * *

0
12. Section 308.150 is amended by revising paragraph (a) to read as 
follows:


Sec.  308.150  Transcripts.

    (a) General rule. Transcripts of testimony, if any, shall be 
recorded by an official reporter, or by any other person or means 
designated by the person conducting the investigation. A witness may, 
solely for the use and benefit of the witness, obtain a copy of the 
transcript of his or her testimony at the conclusion of the 
investigation or, at the discretion of the person conducting the 
investigation, at an earlier time, provided that the witness submits a 
written request for the transcript and the transcript is available. The 
witness requesting a copy of his or her testimony shall bear the cost 
thereof.
* * * * *

Subpart N--Rules and Procedures Applicable to Proceedings Relating 
to Suspension, Removal, and Prohibition Where a Felony ls Charged

0
13. Section 308.161 is amended by republishing the introductory text 
and revising paragraph (a) to read as follows:


Sec.  308.161  Scope.

    The rules and procedures set forth in this subpart shall apply to 
the following:
    (a) Proceedings to suspend an institution-affiliated party of an 
insured State nonmember bank, or an insured State savings association, 
or to prohibit such party from further participation in the conduct of 
the affairs of any depository institution, if continued service or 
participation by such party posed, poses, or may pose a threat to the 
interests of the depositors of, or threatened, threatens, or may 
threaten to impair public confidence in, any relevant depository 
institution (as defined at section 1818(g)(1)(E) of Title

[[Page 5014]]

12), where the individual is the subject of any state or federal 
information, indictment, or complaint, involving the commission of, or 
participation in:
* * * * *

0
14. Section 308.163 is amended by revising paragraphs (a)(2) and (c), 
and adding paragraph (d), to read as follows:


Sec.  308.163  Notice of suspension or prohibition, and orders of 
removal or prohibition.

    (a) * * *
    (2) The suspension or prohibition shall be effective immediately 
upon service on the institution-affiliated party, who shall immediately 
comply with the requirements thereof, and shall remain in effect until 
final disposition of the information, indictment, complaint, or until 
it is terminated by the Board of Directors or its designee under the 
provisions of Sec.  308.164 or otherwise.
* * * * *
    (c) The notice of suspension or prohibition or the order of removal 
or prohibition shall:
    (1) Inform the institution-affiliated party that a written request 
for a hearing, stating the relief desired and grounds therefore, and 
any supporting evidence, may be filed with the Executive Secretary 
within 30 days after service of the written notice or order; and
    (2) Set forth the basis and facts in support of the notice or order 
and address the relevant considerations specified in Sec.  308.162.
    (d) To obtain a hearing, the institution-affiliated party shall 
file with the Executive Secretary a written request for a hearing 
within 30 days after service of the notice of suspension or prohibition 
or the order of removal or prohibition, which shall:
    (1) Admit or deny specifically each allegation in the notice or 
order, or state that the institution-affiliated party is without 
knowledge or information, which statement shall have the effect of a 
denial. Any allegation not denied shall be deemed to be admitted. When 
an institution-affiliated party intends in good faith to deny only a 
part of or to qualify an allegation, he shall specify so much of it as 
is true and shall deny only the remainder; and
    (2) Shall state whether the institution-affiliated party is 
requesting termination or modification of the notice or order, and 
shall state with particularity how he intends to show that his 
continued service to or participation in the conduct of the affairs of 
the depository institution would not, or is not likely to, pose a 
threat to the interests of its depositors or to impair public 
confidence in the depository institution.

0
15. Section 308.164 is amended by revising paragraphs (b)(1), (3), and 
(5), and adding paragraph (b)(10), to read as follows:


Sec.  308.164  Hearings.

* * * * *
    (b) Hearing procedure. (1) The hearing shall be held in Washington, 
DC, or at another designated place, before a presiding officer 
designated by the Executive Secretary.
* * * * *
    (3) The institution-affiliated party may appear at the hearing and 
shall have the right to introduce relevant and material documents. 
Members of the FDIC enforcement staff may attend the hearing and 
participate as representatives of the FDIC enforcement staff. Following 
the introduction of all evidence, the applicant and the representative 
of the FDIC enforcement staff shall have an opportunity for oral 
argument; however, the parties may jointly waive the right to oral 
argument, and, in lieu thereof, elect to submit written argument.
* * * * *
    (5) At the discretion of the presiding officer, witnesses may be 
presented within specified time limits, provided that a list of 
witnesses is furnished to the presiding officer and to all other 
parties prior to the hearing. Witnesses shall be sworn, unless 
otherwise directed by the presiding officer. The presiding officer may 
ask questions of any witness. Each party shall have the opportunity to 
cross-examine any witness presented by an opposing party. The 
transcript of the proceedings shall be furnished, upon request and 
payment of the cost thereof, to the institution-affiliated party 
afforded the hearing. A copy of the transcript shall be sent directly 
to the presiding officer, who shall have authority to correct the 
record sua sponte or upon the motion of any party.
* * * * *
    (10) The institution-affiliated party has the burden of showing, by 
a preponderance of the evidence, that his or her continued service to 
or participation in the conduct of the affairs of a depository 
institution does not, or is not likely to, pose a threat to the 
interests of the depository institution's depositors or threaten to 
impair public confidence in the depository institution.
* * * * *

PART 390--REGULATIONS TRANSFERRED FROM THE OFFICE OF THRIFT 
SUPERVISION

0
16. The authority citation for part 390 is revised to read as follows:

    Authority: 12 U.S.C. 1819.
    Subpart F also issued under 5 U.S.C. 552; 559; 12 U.S.C. 2901 et 
seq.
    Subpart G also issued under 12 U.S.C. 2810 et seq., 2901 et 
seq.; 15 U.S.C. 1691; 42 U.S.C. 1981, 1982, 3601-3619.
    Subpart I also issued under 12 U.S.C. 1831x.
    Subpart J also issued under 12 U.S.C. 1831p-1.
    Subpart K also issued under 12 U.S.C. 1817; 1818; 15 U.S.C. 78c; 
78 l.
    Subpart L also issued under 12 U.S.C. 1831p-1.
    Subpart M also issued under 12 U.S.C. 1818.
    Subpart O also issued under 12 U.S.C. 1828.
    Subpart P also issued under 12 U.S.C. 1470; 1831e; 1831n; 1831p-
1; 3339.
    Subpart Q also issued under 12 U.S.C. 1462; 1462a; 1463; 1464.
    Subpart R also issued under 12 U.S.C. 1463; 1464; 1831m; 1831n; 
1831p-1.
    Subpart S also issued under 12 U.S.C. 1462; 1462a; 1463; 1464; 
1468a; 1817; 1820; 1828; 1831e; 1831o; 1831p-1; 1881-1884; 3207; 
3339; 15 U.S.C. 78b; 78 l; 78m; 78n; 78p; 78q; 78w; 31 U.S.C. 5318; 
42 U.S.C. 4106.
    Subpart T also issued under 12 U.S.C. 1462a; 1463; 1464; 15 
U.S.C. 78c; 78 l; 78m; 78n; 78w.
    Subpart U also issued under 12 U.S.C. 1462a; 1463; 1464; 15 
U.S.C. 78c; 78 l; 78m; 78n; 78p; 78w; 78d-1; 7241; 7242; 7243; 7244; 
7261; 7264; 7265.
    Subpart V also issued under 12 U.S.C. 3201-3208.
    Subpart W also issued under 12 U.S.C. 1462a; 1463; 1464; 15 
U.S.C. 78c; 78 l; 78m; 78n; 78p; 78w.
    Subpart X also issued under 12 U.S.C. 1462; 1462a; 1463; 1464; 
1828; 3331 et seq.
    Subpart Y also issued under 12 U.S.C. 1831o.
    Subpart Z also issued under 12 U.S.C. 1462; 1462a; 1463; 1464; 
1828 (note).

Subpart B--[Removed and reserved]

0
17. Remove and reserve part 390, subpart B consisting of Sec. Sec.  
390.10 through 390.23.

Subpart C--[Removed and reserved]

0
18. Remove and reserve part 390, subpart C consisting of Sec. Sec.  
390.30 through 390.75.

Subpart D--[Removed and reserved]

0
19. Remove and reserve part 390, subpart D consisting of Sec. Sec.  
390.80 through 390.86.

[[Page 5015]]

Subpart E--[Removed and reserved]

0
20. Remove and reserve part 390, subpart E consisting of Sec. Sec.  
390.90 through 390.97.

    Dated at Washington, DC, this 21st day of January, 2015.

    By order of the Board of Directors.

Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.
[FR Doc. 2015-01327 Filed 1-29-15; 8:45 am]
BILLING CODE 6714-01-P