PRIA, Government Policy, Made Personal

Summary

It is illegal for an officer, director, or employee of a bank or similar financial firm to give a loan or any gift to an examiner who inspects that same institution. Breaking this rule can lead to a federal fine, up to 1 year in jail, or both. The person may also have to pay back an amount equal to the loan or gift. Federal bank regulators can make extra rules that limit giving or getting credit or home loans under this rule, after they talk with each other. An examiner means someone appointed or elected by a federal or state agency to inspect financial firms. The rule covers actions by major federal regulators (for example, the OCC, Federal Reserve, FDIC, FHFA, Farm Credit agencies, and the SBA). “Financial institution” here does not include credit unions, Federal Reserve Banks, Federal home loan banks, or bank holding companies. Some loans are not covered, such as credit card accounts under open-end plans and mortgages on an examiner’s main home, if the examiner meets the same requirements and gets no better terms than other borrowers.

Title 18, §212

Crimes and Criminal Procedure, Source: USLM XML via OLRC

(a)In General.—

Except as provided in subsection (b), whoever, being an officer, director, or employee of a financial institution, makes or grants any loan or gratuity, to any examiner or assistant examiner who examines or has authority to examine such bank, branch, agency, organization, corporation, association, or institution—

(1)shall be fined under this title, imprisoned not more than 1 year, or both; and

(2)may be fined a further sum equal to the money so loaned or gratuity given.

(b)Regulations.—

A Federal financial institution regulatory agency may prescribe regulations establishing additional limitations on the application for and receipt of credit under this section and on the application and receipt of residential mortgage loans under this section, after consulting with each other Federal financial institution regulatory agency.

(c)Definitions.—

In this section: (1) Examiner.—

(2)Federal financial institution regulatory agency.—

The term “Federal financial institution regulatory agency” means—

(A)the Office of the Comptroller of the Currency;

(B)the Board of Governors of the Federal Reserve System;

(C)the Federal Deposit Insurance Corporation;

(D)the Federal Housing Finance Agency;

(E)the Farm Credit Administration;

(F)the Farm Credit System Insurance Corporation; and

(G)the Small Business Administration.

(3)Financial institution.—

The term “financial institution” does not include a credit union, a Federal Reserve Bank, a Federal home loan bank, or a depository institution holding company.

(4)Loan.—

The term “loan” does not include any credit card account established under an open end consumer credit plan or a loan secured by residential real property that is the principal residence of the examiner, if—

(A)the applicant satisfies any financial requirements for the credit card account or residential real property loan that are generally applicable to all applicants for the same type of credit card account or residential real property loan;

(B)the terms and conditions applicable with respect to such account or residential real property loan, and any credit extended to the examiner under such account or residential real property loan, are no more favorable generally to the examiner than the terms and conditions that are generally applicable to credit card accounts or residential real property loans offered by the same financial institution to other borrowers cardholders in comparable circumstances under open end consumer credit plans or for residential real property loans; and

(C)with respect to residential real property loans, the loan is with respect to the primary residence of the applicant.

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

A prior section 212, acts

June 25, 1948, ch. 645, 62 Stat. 694, § 212, formerly § 217; Pub. L. 85–699, title VII, § 701(a), Aug. 21, 1958, 72 Stat. 698; Pub. L. 86–168, title I, § 104(h), Aug. 18, 1959, 73 Stat. 387; renumbered § 212, Pub. L. 87–849, § 1(d), Oct. 23, 1962, 76 Stat. 1125; Pub. L. 101–73, title IX, § 962(a)(1), Aug. 9, 1989, 103 Stat. 501; Pub. L. 101–647, title XXV, § 2597(b), Nov. 29, 1990, 104 Stat. 4908; Pub. L. 103–322, title XXXIII, §§ 330004(1), 330010(1), 330016(1)(K), Sept. 13, 1994, 108 Stat. 2141, 2143, 2147, related to offer of loan or gratuity to bank examiner, prior to repeal by Pub. L. 108–198, § 2(a), Dec. 19, 2003, 117 Stat. 2899. Another prior section 212, act

June 25, 1948, ch. 645, 62 Stat. 693, related to an offer or threat to a customs officer or employee, prior to the general amendment to this chapter by Pub. L. 87–849 and is substantially covered by revised section 201.

Amendments

2010—Subsec. (c)(2)(C) to (H). Pub. L. 111–203 redesignated subpars. (D) to (H) as (C) to (G), respectively, and struck out former subpar. (C) which read as follows: “the Office of Thrift Supervision;”. 2008—Subsec. (c)(2)(E). Pub. L. 110–289 substituted “Federal Housing Finance Agency” for “Federal Housing Finance Board”.

Statutory Notes and Related Subsidiaries

Effective Date

of 2010 AmendmentAmendment by Pub. L. 111–203 effective on the transfer date, see section 351 of Pub. L. 111–203, set out as a note under section 906 of Title 2, The Congress.

§212 Offer of Loan or Gratuity to Financial Institution Examiner