Sunday, October 04, 2009
For the third year in a row, officials in the Treasury Department have extended an exemption that allows savings and loan employees convicted of financial crimes to hold onto their jobs. The Office of Thrift Supervision (OTS) filed a rule that went into effect last month delaying implementation of section 19(e) of the Federal Deposit Insurance Act “which prohibits any person who has been convicted of any criminal offense involving dishonesty, breach of trust, or money laundering” from being employed in certain positions at S&L holding companies (or SLHC).
According to an OTS document, the temporary exemption was supposed to expire on September 5, 2007. However, the agency extended the deadline that year as well as in 2008 and now in 2009. The new deadline for allowing section 19(e) to go back into effect is September 30, 2010.
In their regulatory filing, agency officials said this latest exemption “will avoid needless disruptions of SLHC operations” while OTS continues to review public comments on the matter and develop a final rule once and for all.
-Noel Brinkerhoff
Prohibited Service at Savings and Loan Holding Companies; Extension of Expiration Date of Temporary Exemption (Office of Thrift Supervision)
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