§324 Laws Applicable on Becoming Members

Summary

Banks that join the Federal Reserve must follow the reserve and capital rules in this chapter. They must follow national bank rules that stop banks from lending on or buying their own stock and rules about withdrawing or harming their capital stock. They must follow sections 56 and 60(b) about paying dividends. Whenever those rules mention the Comptroller of the Currency, for these banks that means the Board of Governors of the Federal Reserve System. Officers, agents, and employees are also covered by the criminal penalties in sections 334, 656, and 1005 of Title 18. These banks must file reports of condition and dividend payments to their Federal Reserve bank. They must file not less than three reports each year when called on dates set by the Board of Governors. If a bank misses, files late, or gives false or misleading reports, it can be fined: up to $2,000 per day for inadvertent or minimally late errors; up to $20,000 per day for other failures; and up to $1,000,000 per day or 1 percent of the bank’s total assets per day (whichever is less) if the bank knowingly or recklessly files false information. The bank must prove an error was inadvertent. The Board collects fines under section 1818(i)(2). A bank can request an agency hearing within 20 days after a penalty notice, and section 1818(h) applies. Reports must follow the form and content the Board requires.