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The Vermont Statutes Online
Title
08
:
Banking and Insurance
Chapter
201
:
SUPERVISION; DEFINITIONS
Subchapter
006
:
ENFORCEMENT
§
11601. Enforcement powers of Commissioner
(a) The
Commissioner may:
(1) Restrict the
withdrawal of deposits from a Vermont financial institution, a state financial
institution, or a branch of a foreign bank licensed under this title when the Commissioner
finds that extraordinary circumstances make the restriction necessary for the
proper protection of depositors in the affected institution.
(2) Order the
holders of equity interests in a Vermont financial institution or financial
institution regulated under this title to refrain from voting on any matter if
the Commissioner finds that the order is necessary to protect the institution
against reckless, incompetent, or careless management, safeguard the funds of
depositors, or prevent the willful violation of this act or of any lawful order
issued under it, and in such a case the equity interests of such a holder shall
not be counted in determining the existence of a quorum or a percentage of the
outstanding interests necessary to take any action by the financial
institution.
(3) Order any
person to cease violating this title, a lawful regulation or order of the
Commissioner issued under it or to cease engaging in any unsafe or unsound
practice.
(4) Except as
provided in subdivision (5) of this subsection, impose an administrative
penalty of not more than $15,000.00 for each violation of this title, a lawful
regulation or order of the Commissioner issued under it, upon any person:
(A) who
knowingly violates this title or a lawful regulation or order issued under it;
(B) who has
knowingly engaged or participated in any materially unsafe or unsound practice
in connection with a financial institution; or
(C) who has
knowingly committed or engaged in any act, omission, or practice which
constitutes a breach of fiduciary duty to the financial institution, including,
violations of section 14110 of this title.
(5) Impose an
administrative penalty of not more than $1,000.00 per day on any person who
fails without good cause to file any report or other filing under chapters 73,
77, and 200 through 210 of this title when due.
(6) Remove from
a Vermont financial institution or state financial institution regulated under
this title any person:
(A) who
knowingly violates this title or a lawful regulation or order issued under it;
(B) who is
convicted of a crime involving dishonesty;
(C) who has
knowingly engaged or participated in any materially unsafe or unsound practice
in connection with the financial institution; or
(D) who has
knowingly committed or engaged in any act, omission, or practice which
constitutes a breach of fiduciary duty to the financial institution.
(b) In
determining the amount of any administrative penalty assessed pursuant to this
section, the Commissioner shall consider the following factors:
(1) the
appropriateness of the administrative penalty with respect to the financial
resources and good faith of the person or financial institution charged;
(2) the gravity
of the violation or practice;
(3) the history
of previous violations or practices of a similar nature;
(4) the economic
benefit, if any, derived by any person from the violation or practice;
(5) whether the
financial institution has suffered or probably will suffer financial loss or
other damage;
(6) whether the
interest of depositors could be seriously prejudiced by such violation,
practice or breach of fiduciary duty; or
(7) other
factors as justice may require.
(c)(1) Except as
provided in subdivision (2) of this subsection, the Commissioner shall provide
notice of any enforcement order proposed pursuant to this section and the
grounds therefor by mail to the financial institution and to any affected
person. The financial institution or any person so served may, within 30 days
of service on the financial institution, request that a hearing be held by the
Commissioner. If no hearing is requested, the proposed order shall become final
30 days after service on the financial institution. The provisions of 3 V.S.A.
chapter 25 shall govern any hearing held by the Commissioner under this section.
An appeal under this section shall be filed within 30 days of the date of the
Commissioner's decision and shall be to the Washington Superior Court.
(2)
Notwithstanding subdivision (1) of this subsection, the Commissioner may, ex
parte without notice, issue any enforcement order under this section in any
case in which the Commissioner determines such action is necessary to:
(A) conserve the
assets of any financial institution; or
(B) protect the
interests of the depositors.
(d) The hearing
on a removal order shall be private unless the Commissioner determines that a
public hearing is necessary to protect the public interest. If it is deemed
necessary to assure the continued safety and soundness of the financial
institution, the Commissioner may order an immediate suspension of any person
pending completion of further administrative proceedings on his or her removal.
(e) An executive
officer, director, or holder of principal equity interests who fails to comply
with a standard established by subsection 14110(a) of this title shall be
subject to the civil penalties established by 12 U.S.C. sections 504, 505, and
506, as amended, as if he or she had violated Regulation O directly. (Added
1999, No. 153 (Adj. Sess.), § 2, eff. Jan. 1, 2001; amended 2013, No. 29, § 17,
eff. May 13, 2013.)