Insider abuse is a real thing.  In finance, insiders hold positions of power that must be reigned in.  This goes far beyond asking for an extra side of special sauce, and involves using power or position to secure sweet loan deals that threaten the very stability of the bank.  There is an entire law devoted to insider lending, and Regulation O implements it. Bank regulators take it all very seriously, with violations bringing civil money penalties, Cease and Desist orders, or even individual permanent removal from the banking industry.  In 2022, a mid-size bank in Maryland paid a $9.5 Million dollar fine for Reg O violations!   

Many compliance professionals shy away from Reg O topics for several reasons: it isn’t a consumer compliance issue, it lives in the realm of Safety and Soundness, and it is downright intimidating.  Nobody wants to tell the Chairman of the Board that their overdraft will not and cannot be paid.  However, it is crucial for compliance officers, auditors, loan staff members, and even operational employees to have a solid understanding of Reg O principles.   

Reg O covers insiders, but who exactly is that?  Directors, principal shareholders, and executive officers.  But who exactly are each of them?  Can you name names? And what about their related interests, such as business ventures, joint accounts, or non-profit representation?  Do you know about all of them, and if they are restricted by Reg O limitations?  You also need to know how to treat bank holding company and affiliate insiders.

Further, there are subcategories of being part of the in-crowd, and not all insider-ness is treated the same.  Some insiders can receive more favors than others. 

All limitations involve “extensions of credit”, but that too brings complexity.  Not all extensions of credit are the same, and a $1,001 overdraft might be prohibited, while a $1,000,000 home loan is A-OK. 

Tune into this important 2 hour webinar to receive content including:

• Detailed explanations of who is an insider is who is not
• Exploration of related interests
• What “control” means
• Detailed descriptions of “extensions of credit”
• The different lending limits and when they apply
• Individual limits
  1. Aggregate limits
  2. Executive Officer limits
• When Prior Approval is required, who must get it, and who can grant it
• What preferential treatment is prohibited
• The best way to protect against overdraft pitfalls

Undoubtedly your community institution likes to boast successful business customers as directors.   It is often a feather in the cap of a local bank to land the big business fish as a board member.   However, that directorship can suddenly jeopardize all the business loans held by the business-customer-turned director. Reg O can cramp their style!  Learn all the facts you need to know to help your senior management stay on the right side of the law!

Join Rebekah as she moves from the big picture down into all the various detailed aspects you need to know.  She is a veteran compliance officer, still serving on the front lines of banking, who has been called to the Board room carpet to answer Reg O questions to the very insiders who are restricted.  She has the real-life experience to share, in a relatable and engaging way. 

WHO SHOULD ATTEND:

Compliance staff, risk managers, loan policy makers, operations managers, operations staff, operations, legal, and audit.