Park Bank pays Flood Act penalty

Park Bank was issued an FDIC Order to Pay a Civil Money Penalty of $12,841.50 for engaging in a pattern or practice of committing violations of Part 339 of FDIC Rules and Regulations, which implements the National Flood Disaster Protection Act of 1973.

• On or about April 6, 2018, Respondent made a loan to C.F. in the amount of $86,250 (“C.F. Loan”). The C.F. Loan was and is secured by a building that is on land in a flood plain within a community having at least a one percent chance of flooding in any given year, as designated by the Director of the Federal Emergency Management agency (“FEMA”) for which flood insurance is available under the NFIA (hereafter, “Designated Loan”). Respondent failed to obtain an adequate of flood insurance at the origination of the C.F. Loan, in violation of 12 C.F.R. § 339.3(a). On or about November 2, 2018, Respondent became aware that the C.F. Loan was not sufficiently insured, but failed to provide the borrower with notice of the insufficiency and follow the force-placement requirements, in violation of 12 C.F.R. § 339.7(a).
• On or about August 1, 2012, Respondent made a loan to NG&S in the amount of $312,700 (“NG&S Loan”). NG&S Loan was and is a Designated Loan. Respondent identified the NG&S Loan lacked an adequate amount of insurance in approximately January 2019, but failed to provide the borrower with notice of the insufficiency and follow the force-placement requirements, in violation of 12 C.F.R. § 339.7(a).
• On or about January 3, 2017, Respondent made a loan to P4LI in the amount of $750,000 (“P4LI Loan”). P4LI Loan was not initially, but became, and is a Designated Loan. On or about January 28, 2019, Respondent was notified the P4LI Loan was subject to a flood map change and placed in a flood hazard zone, but failed to force place the necessary insurance until on or about April 1, 2019, in violation of 12 C.F.R. § 339.7(a).
• On or about May 5, 2018, Respondent made a loan to LT in the amount of $85,000 (“LT Loan One”). LT Loan One was and is a Designated Loan. Respondent failed to provide written notice to LT stating whether or not flood insurance was available under the NFIA for the collateral securing LT Loan One in violation of 12 C.F.R. § 339.9(a).
• On or about September 24, 2018, Respondent made a loan to LT in the amount of $30,000 (“LT Loan Two”). LT Loan Two was and is a Designated Loan. Respondent failed to provide written notice to LT stating whether or not flood insurance was available under the NFIA for the collateral securing LT Loan Two in violation of 12 C.F.R. § 339.9(a). Respondent failed to obtain an adequate amount of flood insurance at origination of LT Loan Two in violation of 12 C.F.R. § 339.3(a). In approximately late November or early December of 2018, Respondent determined LT Loan Two was not sufficiently insured, but failed to provide the borrower with notice of the insufficiency and follow the force-placement requirements, in violation of 12 C.F.R. § 339.7(a).
• On or about May 16, 2011, Respondent made a loan to KM and DM in the amount of $70,900 (“KDM Loan One”). KDM Loan One was and is a Designated Loan. On or about March 11, 2013, Respondent made a loan to KM and DM in the amount of $35,000 (“KDM Loan Two”). KDM Loan Two was and is a Designated Loan. On or about May 1, 2019, Respondent made a loan to KM and DM in the amount of $80,000 (“KDM Loan Three”). KDM Loan Three was and is a Designated Loan. Respondent failed to provide written notice to KDM stating whether or not flood insurance was available under the NFIA for the collateral securing KDM Loan Three in violation of 12 C.F.R. § 339.9(a). On or about August 15, 2018, Respondent was notified the insurance policy securing KDM Loan One, KDM Loan Two, and KDM Loan Three had expired and failed to provide the borrowers with notice of the expiration and follow the force-placement requirements, in violation of 12 C.F.R. § 339.7(a).
  
• The violations of Part 339 of the FDIC’s Rules and Regulations set forth above constitute a pattern or practice of committing violations by Respondent pursuant to section 102 of the FDPA, 42 U.S.C. § 4012a(f)(2)(A).