There may be included in such notice any additional information or advice the bank may deem desirable.

The bank shall furnish to the Corporation an affidavit of mailing and an affidavit of publication of the notice to depositors. The affidavit of mailing should be in the form prescribed in § 307.1(b) (1).

(b) The liquidating bank shall continue to file certified statements and pay assessments thereon for the period its deposits are insured, as provided by the Federal Deposit Insurance Act: Provided, That if the liquidating bank or, the assuming bank as its agent, has given the requisite notice to the depositors of the assumption of the deposit liabilities within 30 days after such assumption takes effect, then the liquidating bank shall file a final certified statement, as provided for in § 304.3 (s) and (t), and shall pay to the Corporation the normal assessment thereon." If the deposits of the liquidating bank are assumed by a newly insured bank, the liquidating bank is not required to file certified statements or pay any assessment upon the deposits so assumed, after the semiannual period in which the assumption takes effect.

(c) It is the policy of the Corporation to consider receipt of the following as satisfactory evidence of such assumption:

(1) A certified copy of the resolution (1) duly authorizing the bank's officers to enter into a contract for the sale of the bank's assets to another insured bank upon the consideration of the assumption by it of the deposit liabilities, and

10 If this notice is given by the assuming bank as agent for the liquidating bank, it may add its own name designating itself as agent.

" See § 327.2 of this chapter.

(ii) duly placing the bank in liquidation; and

(2) A certified copy of the assumption agreement, provided it contains an express undertaking by an insured bank to pay the deposit liabilities of the bank going into liquidation.

(d) The bank shall furnish to the Corporation the information called for in § 307.1(b) (6).

[15 F.R. 8634, Dec. 6, 1950, as amended at 19 F.R. 1666, Mar. 27, 1954; 32 F.R. 9638, July 4, 1967; 32 F.R. 10561, July 19, 1967]

PART 308-RULES OF PRACTICE AND PROCEDURES

Subpart A-Rules of Practice Applicable to All Hearings

Sec. 308.1 308.2

308.3

308.4

Answer.

(a) This subpart prescribes rules of practice and procedure followed by the Federal Deposit Insurance Corporation in hearings held pursuant to the provisions of section 8 of the Federal Deposit Insurance Act pertaining to (1) involuntary termination of the insured status of any bank, (2) the issuance of cease-anddesist orders against any insured State nonmember bank, and (3) the issuance of orders removing or suspending from office and/or prohibiting from further participation in the conduct of the bank's affairs, any director or officer of an insured State nonmember bank or any other person participating in the conduct of the affairs of such a bank.

(b) In connection with any proceeding under Subpart C or D of this part, the Corporation will provide the appropriate State supervisory authority with timely notice of its intent to institute such a proceeding and the grounds therefor. Unless within such time as the Corporation deems appropriate in the light of the circumstances of the case (which time will be specified in the notice) satisfactory corrective action is effectuated by action of the State supervisory authority, the Corporation will proceed as provided in Subparts C and D of this part.

§ 308.2

Appearance and practice before the Corporation.

(a) Power of attorney and notice of appearance. Any person who is a member in good standing of the bar of the highest court of any State, possession, territory, Commonwealth, or the District of Columbia, may represent others before the Corporation upon filing with the Executive Secretary a written declaration that he is currently qualified as provided by this paragraph, and is authorized to represent the particular party on whose behalf he acts. Any other person desiring to appear before or transact business with the Corporation in a representative capacity may be required to file with the Executive Secretary of the Corporation a power of attorney showing his authority to act in such capacity, and he may be required to show to the satisfaction of the Board of Directors that he has the requisite qualifications. Attorneys and representatives of parties to proceedings shall file a written notice of appearance with the Executive Secretary or with the administrative law judge.

(b) Summary suspension. Contemptuous conduct at an argument before the Board of Directors or at a hearing before an administrative law judge shall be ground for exclusion therefrom and suspension for the duration of the argument or hearing.

[32 FR 11147, Aug. 1, 1967, as amended at 38 FR 14263, May 31, 1973]

§ 308.3 Notice of hearing.

Whenever a hearing is ordered by the Board of Directors in any proceeding pursuant to section 8 of the Federal Deposit Insurance Act, a notice of hearing shall be given by the Executive Secretary or other designated officer acting for the Board of Directors to the party afforded the hearing and to the appropriate supervisory authority. Such notice shall state the time, place, and nature of the hearing, the administrative law judge, and the legal authority and jurisdiction under which the hearing is to be held, and shall contain a statement of the matters of fact or law constituting the grounds for the hearing, and shall be delivered by personal service, by registered or certified mail to the last known address, or other appropriate means, sufficiently in advance of the date set for hearing to comply with the provisions of the Federal Deposit Insurance Act. The term "party" means a person or

agency named or admitted as a party, or any person or agency who has filed a written request and is entitled as of right to be admitted as a party; but a person or agency may be admitted for a limited purpose.

[32 FR 11147, Aug. 1, 1967, as amended at 38 FR 14263, May 31, 1973]

§ 308.4 Answer.

(a) When required. In any notice of hearing issued by the Board of Directors, the Board of Directors may direct the party or parties afforded the hearing to file an answer to the allegations contained in the notice, and any party to any proceeding may file an answer. Except where a different period of not less than 10 days after service of a notice of hearing is specified by the Board of Directors, a party directed to file an answer, or a party who elects to file an answer, shall file the same with the Executive Secretary within 20 days after service upon him of the notice of hearing.

(b) Requirements of answer; effect of failure to deny. An answer filed under this section shall specifically admit, deny, or state that the party does not have sufficient information to admit or deny each allegation in the notice of hearing. A statement of lack of information shall have the effect of a denial. Any allegation not denied shall be deemed to be admitted. When a party intends to deny only a part or a qualification of an allegation, he shall specify so much of it as is true and shall deny only the remainder.

(c) Admitted allegations. If a party filing an answer under this section elects not to contest any of the allegations of fact set forth in the notice of hearing, his answer shall consist of a statement that he admits all of the allegations to be true. Such an answer shall constitute a waiver of hearing as to the facts alleged in the notice, and together with the notice will provide a record basis on which the administrative law judge shall file with the Executive Secretary his recommended decision containing his findings of fact, conclusions of law and proposed order. Any such party may, however, upon service of the recommended decision, findings, conclusions and proposed order of the administrative law judge, file exceptions thereto within the time provided in § 308.10(a).

(d) Effect of failure to answer. Failure of a party to file an answer required by this section within the time provided shall be deemed to constitute a waiver of his right to appear and contest the

allegations of the notice of hearing and to authorize the administrative law judge, without further notice to the party, to find the facts to be as alleged in the notice and to file with the Executive Secretary a recommended decision containing such findings and appropriate conclusions. The Board of Directors or the administrative law judge may, for cause shown, permit the filing of a delayed answer after the time for filing the answer has expired.

(e) Opportunity for informal settlement. Any interested party may at any time submit to the Secretary, for consideration by the Board of Directors, written offers or proposals for settlement of a proceeding, without prejudice to the rights of the parties. No such offer or proposal, or counteroffer or proposal, shall be admissible in evidence over the objection of any party in any hearing in connection with such proceeding. The foregoing provisions of this section shall not preclude settlement of any proceeding through the regular adjudicatory process by the filing of an answer as provided in this section, or by submission of the case to the administrative law judge on a stipulation of facts and an agreed order.

[32 FR 11147, Aug. 1, 1967, as amended at 38 FR 14263, May 31, 1973]

§ 308.5 Conduct of hearings.

(a) Selection of administrative law judge. Any hearing shall be held before an administrative law judge selected by the Civil Service Commission and designated by the Board of Directors and, unless otherwise provided in the notice of hearing, shall be conducted as hereinafter provided.

(b) Authority of administrative law judge. All hearings governed by this part shall be conducted in accordance with the provisions of chapter 5 of title 5 of the United States Code. The administrative law judge designated by the Board of Directors to preside at any such hearing shall have complete charge of the hearing, and he shall have the duty to conduct it in a fair and impartial manner and to take all necessary action to avoid delay in the disposition of proceedings. The administrative law judge shall have all powers necessary to that end, including the following:

(1) To administer oaths and affirmations:

(2) To issue subpenas and subpenas duces tecum, as authorized by law, and

to revoke, quash, or modify any such subpena;

(3) To receive relevant evidence and to rule upon the admission of evidence and offers of proof;

(4) To take or cause despositions to be taken;

(5) To regulate the course of the hearing and the conduct of the parties and their counsel;

(6) To hold conferences for the settlement or simplification of issues or for any other proper purpose; and

(7) To consider and rule upon, as Justice may require, all procedural and other motions appropriate in an adversary proceeding, except that an administrative law judge shall not have power to decide any motion to dismiss the proceedings or other motion which results in final determination of the merits of the proceedings.

Without limitation on the foregoing provisions of this paragraph, the administrative law judge shall, subject to the provisions of this part, have all the authority of section 556 (c) of title 5 of the United States Code.

(c) Prehearing conference. The administrative law judge may, on his own initiative or at the request of any party, direct counsel for all parties to meet with him at a specified time and place prior to the hearing, or to submit suggestions to him in writing, for the purpose of considering any or all of the following:

(1) Simplification and clarification of the issues;

(2) Stipulations, admissions of fact and of the contents and authenticity of documents;

(3) Matters of which official notice will be taken; and

(4) Such other matters as may aid in the orderly disposition of the proceeding, including disclosure of the names of witnesses and of documents or other physical exhibits which will be introduced in evidence in the course of the proceeding.

Such conferences shall, at the request of any party, be recorded and at the conclusion thereof the administrative law judge shall enter in the record an order which recites the results of the conference. Such order shall include the administrative law judge's rulings upon matters considered at the conference, together with appropriate directions to the parties, if any; and such order shall con

trol the subsequent course of the proceedings, unless modified at the hearing to prevent manifest injustice. Except as authorized by law, the administrative law judge shall not consult any person or party on any fact in issue unless upon notice and opportunity for all parties to participate, nor be responsible to or subject to the supervision or direction of any officer, employee, or agent engaged in the performance of investigative or prosecut-i ing functions. No officer, employee, or agent engaged in the performance of investigative or prosecuting functions in any case shall, in that case or a factually related case, participate or advise in the decision of the administrative law judge except as a witness or counsel in the proceedings.

(d) Attendance at hearings. A hearing shall ordinarily be private and shall be attended only by the parties, their representatives or counsel, witnesses while testifying, and other persons having an official interest in the proceedings: Provided, however, That on written request by a party or representatives of the Board of Directors, or on the Board's own motion, the Board, in its discretion and to the extent permitted by law, may permit other persons to attend or may order the hearing to be public.

(e) Transcript of testimony. Hearings shall be recorded and transcripts will be made available to any party upon payment of the cost thereof and, in the event the hearing is public, shall be furnished on similar payment to other interested persons. A copy of the transcript of the testimony taken at any hearing, duly certified by the reporter, together with all exhibits, all papers and requests filed in the proceedings, and any briefs or memoranda of law theretofore filed in the proceeding, shall be filed with the Executive Secretary of the Corporation, who shall transmit the same to the administrative law judge. The Secretary shall promptly serve notice upon each of the parties of such filing and transmittal. The administrative law judge shall have authority to rule upon motions to correct the record.

(f) Order of procedure. The counsel for the Corporation shall open and close.

(g) Continuances and changes or extensions of time and changes of place of hearing. Except as otherwise expressly provided by law, the Board of Directors may by the notice of hearing or subsequent order provide time limits different from those specified in this part, and the

1

Board of Directors may, on its own initiative or for good cause shown, change or extend any time limit prescribed by these rules or the notice of hearing, or change the time and place for beginning any hearing hereunder. The administrative law judge may continue or adjourn a hearing from time to time and, as permitted by law or agreed to by the parties, from place to place. Extensions of time for making any filing or performing any act required or allowed to be done within a specified time in the course of a proceeding may be granted by the administrative law judge for good cause shown.

(h) Call for further evidence, oral argument, briefs, reopening of hearing. The administrative law judge may call for the production of further evidence upon any issue, may permit oral argument and submission of briefs at the hearing and, upon appropriate notice, may reopen any hearing at any time prior to the certification of his recommended decision to the Executive Secretary. The Board of Directors shall render its decision within 90 days after the Executive Secretary has notified the parties, pursuant to § 308.13, that the case has been submitted to the Board of Directors for final decision, unless within such 90-day period the Board of Directors shall order that such notice be set aside and the case reopened for further proceedings.

[32 FR 11147, Aug. 1, 1967, as amended at 38 FR 14263, 14264, May 31, 1973]

(a) Issuance. The administrative law judge, or in the event he is unavailable, the Board of Directors, shall issue subpenas at the request of any party, requiring the attendance of witnesses or the production of documentary evidence at any designated place of hearing; except that where it appears to the administrative law judge or the Board of Directors that the subpena may be unreasonable, oppressive, excessive in scope, or unduly burdensome, the party seeking the subpena may be required, as a condition precedent to the issuance of the subpena, to show the general relevance and reasonable scope of the testimony or other evidence sought. In the event the administrative law judge or the Board of Directors, after consideration of all the circumstances, determines that the subpena or any of its terms are unreasonable, oppressive,

excessive in scope, or unduly burdensome, he or it may refuse to issue the subpena, or issue it only upon such conditions as fairness requires.

(b) Motion to quash. Any person to whom a subpena is directed may, prior to the time specified therein for compliance but in no event more than five days after the date of service of such subpena, with notice to the party requesting the subpena, apply to the administrative law judge, or, if he is unavailable, to the Board of Directors, to revoke, quash, or modify such subpena, accompanying such application with a statement of the reasons therefor.

(c) Service of subpena. Service of a subpena upon a person named therein shall be made by delivering a copy of the subpena to such person and by tendering the fees for 1 day's attendance and the mileage as specified in paragraph (d) of this section, except that when a subpena is issued at the instance of the Board of Directors fees and mileage need not be tendered at the time of service of the subpena. If service is made by a U.S. marshal, or his deputy, or an employee of the Corporation, such service shall be evidenced by his return thereon. If made by any other person, such person shall make affidavit thereto, describing the manner in which service is made, and return such affidavit on or with the original subpena. In case of failure to make service, reasons for the failure shall be stated on the original subpena. The original subpena, bearing or accompanied by the required return, affidavit or statement, shall be returned without delay to the administrative law judge.

(d) Attendance of witnesses. The attendance of witnesses and the production of documents pursuant to a subpena, issued in connection with a hearing provided for in Subpart B, C, or D of this part, may be required from any place in any State or in any territory at any designated place where the hearing is being conducted. Witnesses subpenaed in any proceeding under this part shall be paid the same fees and mileage that are paid witnesses in the district courts of the United States.

(e) Depositions. The Board of Directors or administrative law judge, by subpena or subpena duces tecum, may order evidence to be taken by deposition in any proceeding at any stage thereof. Such depositions may be taken by the administrative law judge or before any