Saturday, December 23, 2006

Federal Reserve Board Drops Citigroup Inc. Litigation

The Federal Reserve Board on Friday terminated all litigation against Citigroup Incorporated. A sigh of relief for all involved. You can read more on this issue here.

Below are some of enforcement actions the Federal Reserve can take when a private company is proven to be managing their business outside US laws and bi-laws.

Since August 1989, the Federal Reserve has made enforcement orders public in accordance with the Financial Institutions Recovery, Reform, and Enforcement Act of 1989.

Since November 1990, it has also made written agreements public in accordance with the Crime Control Act of 1990. The formal enforcement actions are made public through a press release that includes a copy of the order or agreement.

Formal enforcement actions taken by the Federal Reserve before August 1989 are not public.

The Federal Reserve supervises the following entities and has the statutory authority to take formal enforcement actions against them;

- Generally, the Federal Reserve takes formal enforcement actions against the above entities for violations of laws, rules, or regulations, unsafe or unsound practices, breaches of fiduciary duty, and violations of final orders. Formal enforcement actions include cease and desist orders, written agreements, removal and prohibition orders, and orders assessing civil money penalties.

- Edge and agreement corporations

- Branches and agencies of foreign banking organizations operating in the United States and their parent banks

- State member banks

- Bank holding companies

- Non-bank subsidiaries of bank holding companies

- Officers, directors, employees, and certain other categories of individuals associated with the above banks, companies, and organizations (referred to as "institution-affiliated parties")

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