Reading Room Document

Application of 18 U.S.C. §§ 212—213 to Borrowing Practices of Bank Examiners

The document discusses the borrowing practices of bank examiners and whether certain scenarios violate 18 U.S.C. §§ 212-13. It concludes that while the second approach of allowing a bank examiner to obtain loans from banks where their authority to examine has been revoked does not violate the law, the first approach of a bank examiner's spouse borrowing money from a federally insured State bank poses potential problems. The document raises questions about whether loans to the spouse of a bank examiner could lead to biased and less than objective examination of the bank, and whether the courts would apply the statutes to such situations. It also recommends extreme caution in following this practice. Additionally, the document discusses the authority of the superintendent of banking to revoke an examiner's authority and concludes that it would meet the purposes served by 18 U.S.C. §§ 212-13, ensuring the examiner's unbiased objectivity.

June 21, 1977