COMMITTEE SUBSTITUTE
FOR
COMMITTEE SUBSTITUTE
FOR
Senate Bill No. 282
(By Senators Minard, Kessler, Helmick and Hunter)
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[Originating in the Committee on Finance;
reported February 18, 2002.]
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A BILL to amend and reenact section four, article two, chapter
thirty-one-a of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, relating to the powers of the
commissioner of banking; and eliminating the requirement that
the commissioner maintain an office at the capitol complex.
Be it enacted by the Legislature of West Virginia:
That section four, article two, chapter thirty-one-a of the
code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted to read as follows:
ARTICLE 2. DIVISION OF BANKING.
§31A-2-4. Jurisdiction of commissioner; powers, etc., of
division transferred to commissioner; powers and duties
of commissioner.
(a) Subject to the powers vested in the board by article three
of this chapter, the commissioner shall have has supervision and jurisdiction over state banks, regulated consumer lenders, second
mortgage lenders and brokers, credit unions and all other persons
now or hereafter made subject to his or her supervision or
jurisdiction. All powers, duties, rights and privileges vested in
the department division are hereby vested in the commissioner. He
or she shall be the chief executive officer of the department
division of banking and shall be is responsible for the
department's division's organization, services and personnel and
for the orderly and efficient administration, enforcement and
execution of the provisions of this chapter and all laws vesting
authority or powers in or prescribing duties or functions for the
division or the commissioner.
(b) The commissioner shall:
(1) Maintain the an office for the department at the state
capitol division and there keep a complete record of all the
department's division's transactions, of the financial conditions
of all financial institutions and such records of the activities of
other persons as the commissioner may deem considers important.
Notwithstanding any other provision of the this code of West
Virginia, heretofore or hereafter enacted, the records relating to
the financial condition of any financial institution and any
information contained therein in the records shall be confidential
for the use of the commissioner and authorized personnel of the
department division of banking. No person shall divulge any
information contained in any such records except as hereafter
authorized in this subdivision in response to a valid subpoena or subpoena duces tecum issued pursuant to law in a criminal
proceeding or in a civil enforcement action brought by the state or
federal regulatory authorities. Subpoenas shall first be directed
to the commissioner, who shall authorize disclosure of relevant
records and information therefrom from the records for good cause,
upon imposing terms and conditions as are deemed considered
necessary to protect the confidential nature of the records, the
financial integrity of the financial institution or the person to
which the records relate, and the legitimate privacy interests of
any individual named in such the records. Conformity with federal
procedures shall be sought where the institution maintains federal
deposit insurance. The commissioner shall have has and may
exercise reasonable discretion as to the time, manner and extent
the other records in his or her office and the information
contained therein shall be in the records are available for public
examination;
(2) Require all financial institutions to comply with all the
provisions of this chapter and other applicable laws, or any rule
promulgated or order issued thereunder;
(3) Investigate all alleged violations of this chapter and all
other laws which he or she is required to enforce and of any rule
promulgated or order issued thereunder; and
(4)(1) Require a criminal background investigation, including
fingerprint checks, of each: (A) Applicant seeking approval to
charter and/or control a state bank, state credit union, or a
foreign bank state agency or representative office; (B) applicant seeking a license to engage in the business of money transmission,
currency exchange, or other activity regulated under article two,
chapter thirty-two-a of this code; (C) applicant subject to the
commissioner's supervision seeking a license to engage in the
business of regulated consumer lending, mortgage lending or
brokering; and (D) department division of banking financial
institutions regulatory employee applicant, to be made through the
West Virginia state police and the federal bureau of investigation:
Provided, That where the applicant is a company or entity already
subject to supervision and regulation by the federal reserve board
or other federal bank, thrift or credit union regulator, or is a
direct or indirect subsidiary of a company or entity subject to
such the supervision and regulation, or where the applicant is a
company subject to the supervision and regulation of the federal
securities and exchange commission whose stock is publicly traded
on a registered exchange or through the national association of
securities dealers automated quotation system, or the applicant is
a direct or indirect subsidiary of such a company, the
investigation into criminal background shall is not be so required.
The provisions of this subdivision are not applicable to applicants
seeking interim bank charters organized solely for the purpose of
facilitating the acquisition of another bank pursuant to section
five, article four of this chapter.
(2) Where a nonexempt applicant hereunder under paragraph (1)
of this subdivision is not a natural person, the principals of the
applicant shall be are subject to the requirements of subdivision paragraph (1) of this subsection subdivision. As used in this
subdivision paragraph, the term "principals" means the chief
executive officer, regardless of title, managing partner if a
partnership, members of the organizing group if no chief executive
officer has yet been appointed, trustee or other person controlling
the conduct of the affairs of a licensee. A person controlling ten
percent or more of the stock of any corporate applicant shall be
deemed considered to be a principal under this provision.
(c) In addition to all other authority and powers vested in
the commissioner by provisions of this chapter and other applicable
laws, the commissioner is authorized and empowered may:
(1) To provide Provide for the organization of the department
division and the procedures and practices thereof of the division
and implement the same procedures and practices by the promulgation
of rules and forms as appropriate, which and the rules shall be
promulgated in accordance with article three, chapter twenty-nine-a
of this code;
(2) To employ Employ, direct, discipline, discharge and
establish qualifications and duties for all personnel for the
department division, including, but not limited to, examiners,
assistant examiners, conservators and receivers, to establish the
amount and condition of bonds for such thereof as the personnel he
or she deems considers appropriate and to pay the premiums thereon
on the bonds and, if he or she so elects, to have all such
personnel subject to and under the classified service of the state
personnel department division;
(3) To cooperate Cooperate with organizations, agencies,
committees and other representatives of financial institutions of
the state in connection with schools, seminars, conferences and
other meetings to improve the responsibilities, services and
stability of the financial institutions;
(4) In addition to the examinations required by section six of
this article, to inspect, examine and audit the books, records,
accounts and papers of all financial institutions at such times as
circumstances in his or her opinion may warrant;
(5) To call Call for and require all such any data, reports
and information from financial institutions under his or her
jurisdiction, at such times and in such form, content and detail
deemed considered necessary by him or her in the faithful discharge
of his or her duties and responsibilities in the supervision of the
financial institutions;
(6) Subject to the powers vested in the board by article three
of this chapter, to supervise the location, organization, practices
and procedures of financial institutions and, without limitation on
the general powers of supervision thereof, to of financial
institutions, require financial institutions to:
(A) Maintain their accounts consistent with such regulations
as he or she may prescribe rules prescribed by the commissioner and
in accordance with generally accepted accounting practices;
(B) Observe methods and standards which he or she may
prescribe for determining the value of various types of assets;
(C) Charge off the whole or any part of an asset which at the time of his or her action could not lawfully be acquired;
(D) Write down an asset to its market value;
(E) Record or file writings creating or evidencing liens or
other interests in property;
(F) Obtain financial statements from prospective and existing
borrowers;
(G) Obtain insurance against damage and loss to real estate
and personal property taken as security;
(H) Maintain adequate insurance against such other risks as he
or she may deem and determine to be necessary and appropriate for
the protection of depositors and the public;
(I) Maintain an adequate fidelity bond or bonds on its
officers and employees;
(J) Take such other action as may that in his or her judgment
be is required of the institution in order to maintain its
stability, integrity and security as required by law and all rules
promulgated by him or her; and
(K) Verify any or all asset or liability accounts;
(7) Subject to the powers vested in the board by article three
of this chapter, to receive from any person or persons and to
consider any request, petition or application relating to the
organization, location, conduct, services, policies and procedures
of any financial institution and to act thereupon on the request,
petition or application in accordance with any provisions of law
applicable thereto;
(8) In connection with the investigations required by subdivision (3), subsection (b) of this section, to issue subpoenas
and subpoenas duces tecum, administer oaths, examine persons under
oath, and hold and conduct hearings, Any such. Any subpoenas or
subpoenas duces tecum to be shall be issued, served and enforced in
the manner provided in section one, article five, chapter twenty-
nine-a of this code. Any person appearing and testifying at such
a hearing may be accompanied by an attorney employed by him or her;
(9) To issue Issue declaratory rulings in accordance with the
provisions of section one, article four, chapter twenty-nine-a of
this code;
(10) To study Study and survey the location, size and services
of financial institutions, the geographic, industrial, economic and
population factors affecting the agricultural, commercial and
social life of the state and the needs for reducing, expanding or
otherwise modifying the services and facilities of financial
institutions in the various parts of the state and to compile and
keep current data thereon to aid and guide him or her in the
administration of the duties of his or her office;
(11) To implement Implement all of the provisions of this
chapter, except the provisions of article three of this chapter,
and all other laws which he or she is empowered to administer and
enforce by the promulgation of rules in accordance with the
provisions of article three, chapter twenty-nine-a of this code;
(12) To implement Implement the provisions of chapter forty-
six-a of this code applicable to consumer loans and consumer credit
sales by the promulgation of rules in accordance with the provisions of article three, chapter twenty-nine-a of this code so
as long as said the rules do not conflict with any rules
promulgated by the state's attorney general;
(13) To foster Foster and encourage a working relationship
between the department division of banking and financial
institutions, credit, consumer, mercantile and other commercial and
finance groups and interests in the state in order to make current
appraisals of the quality, stability and availability of the
services and facilities of financial institutions;
(14) To provide Provide to financial institutions and the
public copies of the West Virginia statutes relating to financial
institutions, suggested drafts of bylaws commonly used by financial
institutions and such any other forms and printed materials as may
be found by him or her to be helpful to financial institutions,
their shareholders, depositors and patrons and to make reasonable
charges therefor for the copies;
(15) To delegate Delegate the powers and duties of his or her
office, other than the powers and duties excepted in this
subsection hereinafter excepted subdivision, to qualified
department division personnel who shall act under the direction and
supervision of the commissioner and for whose acts he or she shall
be is responsible, but the commissioner may delegate to the deputy
commissioner of banking and to no other department division
personnel the following powers, duties and responsibilities, all of
which are hereby granted to and vested in the commissioner and for
all of which the commissioner shall likewise be also is responsible. The commissioner shall:
(A) To order Order any person to cease violating any provision
or provisions of this chapter or other applicable law or any rule
promulgated or order issued thereunder;
(B) To order Order any person to cease engaging in any unsound
practice or procedure which may detrimentally affect any financial
institution or depositor thereof of the financial institution;
(C) To revoke Revoke the certificate of authority, permit or
license of any financial institution except a banking institution
in accordance with the provisions of section thirteen of this
article; and
(D) To accept Accept an assurance in writing that the person
will not in the future engage in the conduct alleged by the
commissioner to be unlawful, which conduct could be subject to an
order under the provisions of this chapter. Such This assurance of
voluntary compliance shall not be considered an admission of
violation for any purpose, except that if a person giving such the
assurance fails to comply with its terms, the assurance is prima
facie evidence that prior to such this assurance the person engaged
in conduct described in such the assurance;
(16) To seek Seek and obtain from courts civil penalties
against any person who violates this chapter, the rules issued
pursuant thereto to this chapter, or any orders lawfully entered by
the commissioner or board of banking and financial institutions in
an amount not less than fifty dollars nor more than five thousand
dollars for each violation;
(17) To receive Receive from state banking institutions
applications to change the locations of their principal offices and
to approve or disapprove such these applications; and
(18) To take such Take other action as he or she may deem
consider necessary to enforce and administer the provisions of this
chapter (,except the provisions of article three of this chapter),
and all other laws which he or she is empowered to administer and
enforce and to apply to any court of competent jurisdiction for
appropriate orders, writs, processes and remedies.