North Dakota Code 6-01-04.2 – Cease and desist orders
1. The department of financial institutions or the board may issue and serve upon a financial corporation, financial institution, or credit union subject to its jurisdiction a complaint stating the factual basis for the department’s or board’s belief that the financial corporation, financial institution, or credit union is engaging in any of the following conduct:
Terms Used In North Dakota Code 6-01-04.2
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Bank: means any national bank, national banking association, corporation, state bank, state banking association, or savings bank, whether organized under the laws of this state or of the United States, engaged in the business of banking. See North Dakota Code 6-01-02
- Banking: means the business of receiving deposits, making loans, discounting commercial paper, issuing drafts, traveler's checks, and similar instruments, handling and making collections, cashing checks and drafts, and buying and selling exchange. See North Dakota Code 6-01-02
- board: when used in this title includes the state banking board and the state credit union board. See North Dakota Code 6-01-03
- capital: as used in this title embraces the amount of outstanding capital notes and debentures legally issued by any banking institution. See North Dakota Code 6-03-42
- Commissioner: means the commissioner of financial institutions. See North Dakota Code 6-01-02
- Complaint: A written statement by the plaintiff stating the wrongs allegedly committed by the defendant.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Credit union: means a cooperative, nonprofit association organized for the purposes of encouraging thrift among its members, creating a source of credit at a fair and reasonable rate of interest, and providing an opportunity for its members to improve their economic and social condition. See North Dakota Code 6-01-02
- Financial corporation: means all entities regulated by the department of financial institutions, excluding financial institutions and credit unions. See North Dakota Code 6-01-02
- Financial institution: means any bank, industrial loan company, or savings and loan association organized under the laws of this state or of the United States. See North Dakota Code 6-01-02
- following: when used by way of reference to a chapter or other part of a statute means the next preceding or next following chapter or other part. See North Dakota Code 1-01-49
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Record: means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form. See North Dakota Code 6-01-02
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See North Dakota Code 1-01-49
- written: include "typewriting" and "typewritten" and "printing" and "printed" except in the case of signatures and when the words are used by way of contrast to typewriting and printing. See North Dakota Code 1-01-37
a. An unsafe or unsound practice.
b. A violation in the past or on a continuing basis of any law, regulation, board order, or written agreement entered into with the board.
2. The complaint must contain a notice of opportunity for hearing pursuant to chapter 28-32. The date for the hearing must be set not less than thirty days after the date the complaint is served upon the financial corporation, financial institution, or credit union.
The financial corporation, financial institution, or credit union may waive the thirty-day notice requirement.
3. If the financial corporation, financial institution, or credit union fails to respond to the complaint within twenty days of its service, or if a hearing is held and the board concludes that the record so warrants, the board may enter an order directing the financial corporation, financial institution, or credit union to cease and desist from engaging in the conduct which was the subject of the complaint and hearing and to take corrective action.
4. The commissioner or the board may enter an emergency, temporary cease and desist order if the commissioner or the board finds the conduct described in the complaint is likely to cause insolvency, substantial dissipation of assets, earnings, or capital of the financial corporation, financial institution, or credit union, or substantial prejudice to the depositors, shareholders, members, or creditors of the financial corporation, financial institution, or credit union. An emergency, temporary cease and desist order is effective immediately upon service on the financial corporation, financial institution, or credit union and remains in effect for no longer than sixty days or until the conclusion of permanent cease and desist proceedings pursuant to this section, whichever is sooner. An emergency, temporary cease and desist order may be issued without an opportunity for hearing. A bank or credit union may request a hearing before the state banking board or state credit union board within ten days of the order to review the factual basis used to issue the emergency, temporary cease and desist order. The decision made by the board during this hearing will be final. If a hearing is not requested, the initial decision of the commissioner or board will be final.