FDIC Proposes Significant Changes to Supervisory Appeals Process

Posted: Aug 26 2020

The FDIC is proposing to establish a new Office of Supervisory Appeals that would replace the current Supervision Appeals Review Committee. The office would be independent from the divisions within the FDIC that have the authority to issue material supervisory determinations. The FDIC noted that it anticipates recruiting externally for the new office and employing reviewing officials on a part-time or intermittent, time-limited basis to ensure its independence.

“The proposal seeks to establish a fair, independent process for a bank to appeal material supervisory decisions,” said FDIC Chairman Jelena McWilliams. “Such an appeals process is key to promoting consistency among examiners across the country, ensuring accountability at the agency, and, ultimately, maintaining stability and public confidence in the nation’s financial system.” She added that she does not expect the proposed changes to result “in an avalanche of appeals” and emphasized that the burden of proof would continue to rest with the bank when making an appeal.

In addition to the new office, the FDIC also proposed to modify the procedures and timeframes for when determinations underlying formal enforcement-related actions may be appealed. The proposal follows a 2019 review conducted by the FDIC of the appeals process. Comments on the proposal are due on Oct. 20.

To read the proposal, visit: https://www.fdic.gov/news/board/2020/2020-08-21-notational-fr-a.pdf