Senate bill would improve supervisory appeals process

ICBA-advocated legislation to improve the bank examination environment through a workable appeals process was introduced in the Senate.

Details: Introduced by Sens. Jerry Moran (R-Kan.) and Joe Manchin (D-W.Va.), the FAIR Exams Act (S. 3541) would:

  • Create an Office of Independent Examination Review within the Federal Financial Institutions Examination Council.

  • Give financial institutions a right to an expedited, independent review of an adverse-examination determination before the office’s director or before an independent administrative law judge.

  • Authorize the director to make a final decision that would be binding on the agency and the financial institution.

ICBA Support: In a letter to Moran and Manchin, ICBA said this level of separation between the appeals process and the agencies will provide distance and insulation. The current system, which grants examiners almost unfettered and unassailable authority, must be reformed, ICBA said.

Background: The legislation—which has enjoyed strong bipartisan and bicameral support in previous Congresses—follows last year’s FDIC final rule eliminating the Office of Supervisory Appeals less than six months after the independent appeals forum became operational and reinstating its Supervision Appeals Review Committee. ICBA has repeatedly expressed opposition to the change.

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