Mar 02 2020
“Banks can’t break the law because they find their duty to their clients inconvenient. Citibank’s misconduct shows us that the OCC must continue to watch it and other Wall Street giants like a hawk.”
WASHINGTON — Sen. John Kennedy (R-La.) today sent a letter to Comptroller of the Currency (OCC) Joseph Otting praising the agency’s enforcement action against Citibank. From at least 2014 to 2017, the bank repeatedly violated the Flood Disaster Protection Act, and Kennedy urged the OCC to continue its enforcement efforts.
“Louisiana families know the risk of flooding all too well. The OCC is right to fine Citibank for failing to make sure homes and businesses in flood zones had flood insurance. Banks can’t break the law because they find their duty to their clients inconvenient. Citibank’s misconduct shows us that the OCC must continue to watch it and other Wall Street giants like a hawk,” said Kennedy.
The Flood Disaster Protection Act requires borrowers to purchase the appropriate flood insurance within 45 days after their lender tells them they need that insurance. If a borrower fails to purchase flood insurance within this period, the lender must purchase insurance on the borrower’s behalf.
In a pattern of illegal behavior, Citibank neglected to purchase the necessary flood insurance for borrowers with loans on properties located in designated flood hazard areas. The penalty for Citibank’s violations totals nearly $18 million.
Read Kennedy’s letter to the OCC here.