mined by the receiver, a list of claims presented before such date shall be filed with the Board.

(d) Upon the payment of insurance to the holder of a share interest, the transfer to the Federal Savings and Loan Insurance Corporation of the insured account, and the subrogation of the Federal Savings and Loan Insurance Corporation with respect to such insured account to the extent provided by law, shall be noted on the books of the receivership.

(e) Allowed claims of share interest to which the Federal Savings and Loan Insurance Corporation has become subrogated; uninsured claims of share interest allowed by the receiver, and claims of share interest approved for payment by the Board regardless of disallowance or nonallowance by the receiver, shall be paid by the receiver in liquidating dividends declared from time to time by the Board, to the extent that funds are available, in such manner and amounts as may be directed by the Board.

[23 F.R. 9908, Dec. 23, 1958, as amended at 32 FR. 6773, May 8, 1967]

§ 549.5-1 Deposit associations.

(a) In the case of a Federal association which is a deposit association within the meaning of that term as used in $545.1-2, this section shall apply in lieu of §§ 549.4 and 549.5.

(b) (1) Upon being directed to do so by the Board, the receiver shall promptly publish, in a newspaper printed in the English language and of general circulation in the city or county in which the home office of the association is located, a notice to all creditors, holders of savings deposits, and holders of savings accounts of such association to present their claims with proof thereof to such receiver on or before a date specified in such notice. The date specified in such notice shall be at least 90 days after the date of the first publication of such notice (Sundays and holidays included). Such notice shall be similarly published on dates approximately 1 month and 2 months respectively after the date of such first publication. Claims not filed within such period shall be disallowed, except as they may thereafter be approved by the Board for payment in whole or in part out of the assets of the association remaining undistributed at the time of such approval and except that, where the claim is with respect to a savings deposit or savings account and is

filed before the expiration of the time for filing claims under the first sentence of subparagraph (1) of paragraph (c) of this section, the filing thereof shall be regarded as the timely filing of a claim under said subparagraph (1). The receiver shall mail a similar notice to any creditor, holder of a savings deposit, or holder of a savings account shown to be such on the books of the association in the possession of the receiver, at the last address of such creditor or holder as the same shall appear on such books, but such notice need not be mailed to the holder of a savings deposit or savings account that has been surrendered and transferred to, or is in the process of being surrendered and transferred to, the Federal Savings and Loan Insurance Corporation. The filing pursuant to this paragraph (b) of a claim with respect to a savings deposit or savings account shall constitute, for the purposes of this paragraph and paragraph (c) of this section, a claim for the right to receive the treatment with respect to the withdrawal value of such savings deposit or savings account which is provided by subparagraph (3) of paragraph (b) of § 545.1-2 and also a claim for the right of such savings deposit (as set forth in said subparagraph (3)) or of such savings account to share in the remaining assets of the association.

(2) Any claim filled pursuant to subparagraph (1) of this paragraph (b) proved to the satisfaction of the receiver shall be allowed by the receiver except as provided in said subparagraph (1). The receiver may disallow in whole or in part or reject in whole or in part any claim so filled or any claim of security, preference, or priority not proved to its satisfaction, and notice of such disallowance or rejection together with the reason therefor shall be served by the receiver upon the claimant. The mailing of notice of such disallowance or rejection to the last address of any claimant appearing on the books of the association in the possession of the receiver or the proof of claim shall be deemed sufficient service for the purposes hereof. Unless the claimant shall within 30 days after the date of such service (Sundays and holldays included) file with the Board written request for payment regardless of such disallowance or rejection by the receiver, such disallowance or rejection shall be final except as the Board may otherwise determine in its discretion.

(3) Upon the expiration of the time fixed for the presentation of claims by the notice provided for in subparagraph (1) of this paragraph (b), the receiver shall cause to be filed with the Board a full and complete list of such claims presented. Such list shall indicate the character of each claim therein listed and whether or not allowed by the receiver. At such other date or dates as may be ordered by the Board or determined by the receiver, a list of claims presented before such date shall be filed with the Board.

(4) Claims allowed under the foregoing provisions of this paragraph (b), and claims approved for payment by the Board under the foregoing provisions of this paragraph (b) regardless of disallowance or nonallowance by the receiver, shall be paid by the receiver, from time to time, to the extent that funds are available, in such manner and amount as may be directed by the Board.

(c) (1) Upon being directed to do so by the Board, the receiver shall promptly, but not sooner than the expiration of the time fixed for the presentation of claims by the notice provided for in subparagraph (1) of paragraph (b) of this section, publish, in a newspaper printed in the English language and of general circulation in the city or county in which the home office of the association is located, a notice to all holders of savings deposits and all holders of savings accounts of the association, except those savings deposits and savings accounts with respect to which claims have previously been filed with the receiver, to present their claims with proof thereof to such receiver on or before a date specified in such notice. The date specified in such notice shall be 3 years after the date of the appointment of the receiver. Such notice shall urge that such claims be presented promptly and shall be similarly published on dates approximately 1 year and 2 years respectively after the date of such first publication. Claims not filed within the period stated in the notice shall be disallowed, except as they may thereafter be approved by the Board for payment in whole or in part out of the assets of the association remaining undistributed at the time of such approval. At the time of the declaration of the first liquidating dividend, the receiver shall credit to a special reserve the proportionate shares of such liquidating dividend otherwise payable to the holders of those unclaimed savings deposits or

savings accounts shown on the books of the association in the possession of the receiver which appear to be outstanding and valid, and similar credits shall from time to time be made for any subsequent liquidating dividends as the same may be declared before the date specified in the notice provided for in this subparagraph (1). The final liquidating dividend to holders of claims whose claims have been allowed or have been approved for payment by the Board regardless of disallowance or nonallowance by the receiver may include any amounts previously undistributed, but such dividend shall in no event be paid before the date specified in the notice provided for in this subparagraph (1). Distributions made or made available on savings deposits or savings accounts under paragraph (b) of this section shall be treated as if they had been made or made available as liquidating dividends under this subparagraph (1), but this sentence shall not authorize the recapture of any such distribution. The provisions of subparagraph (2) of paragraph (b) of this section shall be applicable also to claims filed pursuant to this subparagraph (1).

(2) Upon the expiration of the time fixed for the presentation of claims by the notice provided for in subparagraph (1) of this paragraph (c), the receiver shall cause to be filled with the Board a full and complete list of the claims presented with respect to savings deposits and savings accounts and not included in any list previously filed with the Board by the receiver pursuant to subparagraph (3) of paragraph (b) of this section Such list shall indicate the character of each claim therein listed and whether or not allowed by the receiver. At such other date or dates as may be ordered by the Board or determined by the receiver, a list of claims presented before such date with respect to savings deposits and savings accounts shall be filed with the Board.

(3) Upon the payment of insurance to the holder of a savings deposit or savings account, the transfer to the Federal Savings and Loan Insurance Corporation of the insured deposit or account and the subrogation of the Federal Savings and Loan Insurance Corporation with respect to such insured deposit or account to the extent provided by law shall be noted on the books of the receivership.

(4) Allowed claims with respect to savings deposits or savings accounts to which the Federal Savings and Loan In

surance Corporation has become subrogated, uninsured claims with respect to savings deposits or savings accounts allowed by the receiver, and claims with respect to savings deposits or savings accounts approved for payment by the Board regardless of disallowance or nonallowance by the receiver shall be paid by the receiver in liquidating dividends declared from time to time by the Board, to the extent that funds are available, in such manner and amounts as may be directed by the Board.

[34 FR. 549, Jan. 15, 1969]

$549.6 Inventory;

examinations and audits, and costs thereof; accounting practices.

(a) Inventory. As soon as practicable after taking possession, the receiver shall make an inventory of the assets of such association as of the date of such taking possession, showing the value as carried on the books of the association, and the security therefor, if any, in whatever form the same shall exist, with a brief description of each such assets and such security. Such assets may be listed in such groups or classes as shall, to the satisfaction of the Board, afford full information as to their character and book value, and the receiver shall include a record of the creditor and share liabilities of the association. One copy of such inventory shall promptly be filed with the Secretary to the Board, one copy with the Federal Savings and Loan Insurance Corporation, and one copy shall be retained in the principal office for liquidation of the association, so long as such office is maintained.

(b) Examinations and audits, and costs thereof. Each Federal association for which a receiver has been appointed shall be examined and audited (with appraisals when deemed advisable by the Board) at least annually by the Office of Examinations and Supervision of the Board or as otherwise directed by the Board. The cost, as determined by the Board, of examinations, including office analysis thereof, audits, and any appraisals made in connection therewith, shall be paid from the assets of the association.

(c) Accounting practices; practices; reports. The receiver may, from time to time, prescribe the accounting practices to be followed. The receiver shall make an annual report of its affairs as of June 30

of each year to the Board, on forms prescribed by the Board or the receiver, and such other reports as may be from time to time required by the Board or the receiver and shall accompany each recommendation for the declaration and payment of a liquidating dividend with a report showing the available assets. One copy of the reports required in this section shall be filed with the Secretary to the Board, one copy shall be retained by the Federal Savings and Loan Insurance Corporation, and one copy shall be retained in the principal office for the liquidation of the association, so long as such is maintained.

[23 FR. 9908, Dec. 23, 1958, as amended at 32 F.R. 6771, May 3, 1967]

§ 549.7 Final discharge and release of receiver.

(a) Final report. At such time as the receiver shall recommend a final distribution of the assets or at such time as the receiver shall be otherwise relieved of its duties, the receiver shall file with the Board a detailed report in form satisfactory to the Board.

(b) Final discharge. Unless otherwise directed by the Board, upon the final liquidation of the receivership, or the completion of the duties of the receiver or at such time as the receiver shall be otherwise relieved of its duties, an examination and audit of the association in receivership shall be conducted. The accounts of the receiver shall thereupon be approved or disapproved, and, if approved, the receiver shall thereupon be given a complete and final discharge and release.

§ 549.8 Inspection of reports.

All inventories, statements and reports of the receiver shall be in at least as many copies as required by the regulations in this chapter or as shall be otherwise directed by the Board. One copy shall be filed with the Board and a duplicate shall be filed with the Federal Savings and Loan Insurance Corporation, and each of the inventories, statements, and reports shall constitute permanent records of each liquidation open for inspection at such times and on such conditions as may be from time to time directed by the Board or, in the absence of such directions, whenever the office of the Secretary to the Board shall be open for business.

§ 550.1

Cease-and-desist orders.

(a) Grounds. If, in the opinion of the Board, a Federal association is violating, or has violated, or the Board has reasonable cause to believe that the association is about to violate, a law, rule, regulation, or charter or other condition imposed in writing by the Board in connection with the granting of any application or other request by the association, or written agreement entered into with the Board, or is engaging or has engaged, or the Board has reasonable cause to believe that the association is about to engage, in an unsafe or unsound practice, the Board may issue and serve upon the association a notice of charges in respect thereof.

(b) Notice of charges; hearing. The notice of charges shall contain a statement of the facts constituting the alleged violation or violations or the unsafe or unsound practice or practices, and shall fix a time and place at which a hearing will be held to determine whether an order to cease and desist therefrom should issue against the association. The hearing shall be fixed for a date not earlier than 30 days nor later than 60 days after service of such notice unless an earlier or a later date is set by the Board at the request of the association. Unless the association consents to another place, such hearing shall be held in the Federal judicial district or in the territory (as defined in subsection (d) of section 5 of the Home Owners' Loan Act of 1933, as amended) in which the

home office of the association is located. Such hearing shall be conducted in the manner provided in Part 509 of this chapter.

(c) Issuance of cease-and-desist order. Unless the association appears at the hearing by a duly authorized representative, it shall be deemed to have consented to the issuance of a cease-anddesist order. In the event of consent, or if upon the record made at any such hearing the Board finds that any violation or unsafe or unsound practice specified in the notice of charges has been established, the Board may issue and serve upon the association an order to cease and desist from any such violation or practice. Such order may, by provisions which may be mandatory or otherwise, require the association and its directors, officers, employees, and agents to cease and desist from the same, and, further, to take affirmative action to correct the conditions resulting from any such violation or practice.

(d) Effectiveness of order. A ceaseand-desist order shall become effective at the expiration of 30 days after the service of such order upon the association concerned (except in the case of a cease-and-desist order issued upon consent, which shall become effective at the time specified therein), and shall remain effective and enforceable as provided therein, except to such extent as it is stayed, modified, terminated, or set aside by action of the Board or a reviewing court.

(e) Staying, modifying, terminating, or setting aside of order. Whenever any Federal association or any director, officer, employee, or agent thereof, subject to a cease-and-desist order which has become effective, believes that changed conditions of fact or law require the stay, modification, termination, or setting aside of such order, such association or person may seek such action by the Board by filing with the Board a petition requesting a reopening of the proceedings for that purpose. The petition shall state the changes desired, the grounds therefor, and shall include, when available, such supporting evidence as will provide the basis for a Board decision on the petition. Such petition and supporting information shall be filled with the Board by delivering two copies thereof to the Secretary to the Board. [32 F.R. 6771, May 3, 1967, as amended at 37 F.R. 11557, June 9, 1972]

§ 550.2 Temporary cease-and-desist orders.

(a) Issuance. Whenever the Board determines that the violation or threatened violation or the unsafe or unsound practice or practices, specified in the notice of charges served upon an association under paragraph (a) of § 550.1, or the continuation thereof, is likely to cause insolvency (as defined in paragraph (6)(A) of subsection (d) of section 5 of the Home Owners' Loan Act of 1933, as amended) or substantial dissipation of assets or earnings of the association, or is likely to otherwise seriously prejudice the interests of its savings account holders, the Board may issue a temporary order requiring the association to cease and desist from any such violation or practice.

(b) Effectiveness of temporary order. A temporary order shall become effective upon service upon the association and, unless set aside, limited, or suspended by a court in proceedings authorized by paragraph (3) (B) of subsection (d) of section 5 of the Home Owners' Loan Act of 1933, as amended, shall remain effective and enforceable pending the completion of the administrative proceedings held pursuant to the notice of charges and until such time as the Board shall dismiss the charges specified in such notice or, if a cease-and-desist order is issued against the association pursuant to § 550.1(c), until the effective date of any such order.

§ 550.3 Removal from office and/or prohibition from participation in conduct of affairs of a Federal association.

(a) Grounds. (1) Whenever, in the opinion of the Board, any director or officer of a Federal association has committed any violation of law, rule, or regulation, or of a cease-and-desist order which has become final (as defined in subsection (d) of section 5 of the Home Owners' Loan Act of 1933, as amended), or has engaged or participated in any unsafe or unsound practice in connection with the association, or has committed or engaged in any act, omission, or practice which constitutes a breach of his fiduciary duty as such director or officer, and the Board determines that the association has suffered or will probably suffer substantial financial loss or other damage or that the interests of its savings account holders could be seriously prejudiced by reason of such violation or

practice or breach of fiduciary duty, and that such violation or practice or breach of fiduciary duty is one involving personal dishonesty on the part of such director or officer, the Board may serve upon such director or officer a written notice of its intention to remove him from office.

(2) Whenever, in the opinion of the Board

(i) Any director or officer of a Federal association, by conduct or practice with respect to another savings and loan association or other business institution which resulted in substantial financial loss or other damage, has evidenced his personal dishonesty and unfitness to continue as a director or officer, or

(ii) Any other person participating in the conduct of the affairs of a Federal association, by conduct or practice with respect to such association or other savings and loan association or other business institution which resulted in substantial financial loss or other damage, has evidenced his personal dishonesty and unfitness to participate in the conduct of the affairs of such association, the Board may serve upon such director, officer, or other person a written notice of its intention to remove him from office and/or to prohibit his further participation in any manner in the conduct of the affairs of such association. A copy of such notice shall also be served upon the association.

(b) Notice of intention to remove from office and/or to prohibit further participation in conduct of affairs; hearing. The notice of intention to remove a director, officer, or other person from office and/or to prohibt his further participation in any manner in the conduct of the affairs of the association, shall contain a statement of the facts constituting grounds therefor and shall fix a time and place at which a hearing will be held thereon. The hearing shall be fixed for a date not earlier than 30 days nor later than 60 days after service of such notice, unless an earlier or a later date is set by the Board at the request of (1) such director, officer, or other person, and for good cause shown, or (2) the Attorney General of the United States. Unless such director, officer, or other person consents to another place, such hearing shall be held in the Federal judicial district or in the territory (as defined in subsection (d) of section 5 of the Home Owners' Loan Act of 1933, as amended) in which the home office of the