Banking and Finance Law Daily Wrap Up, WORTH NOTING—Other regulatory, legislative, litigation, and industry developments, (May 2, 2025)

By WK Editorial Staff

A weekly roundup of other items of interest to the banking and finance law community.

ENFORCEMENT ACTIONS—The Federal Deposit Insurance Corporation has issued an order terminating an amended and restated consent order previously issued against Shinhan Bank America, New York, New York. In September 2023, the FDIC assessed a $5 million penalty against the bank pursuant to an Order to Pay a civil money penalty after finding that the bank had violated the Bank Secrecy Act and failed to comply with the requirements of a prior 2017 Consent Order (see Banking and Finance Law Daily, Oct. 2, 2023).

ENFORCEMENT ACTIONS—N.D. Ga.: As previously reported, in the fall of 2024, the Federal Trade Commission launched an enforcement action against debt collector Global Circulation, Inc. (GCI) and GCI’s owner, Kenneth Redon, III, in the federal district court in Atlanta, Georgia, claiming that GCI and Redon violated provisions of the Fair Debt Collection Practices Act (FDCPA) and its implementing regulation (Regulation F), the FTC Act, and the Gramm-Leach-Bliley Act (GLB Act). At that time, GCI and Redon agreed to the FTC’s procuring a temporary restraining order to halt the company’s operations and to turn over its assets to a court-appointed receiver. The Commission alleged that the debt-collection company and its owner tricked consumers into paying millions of dollars in bogus, “phantom” debt by harassing them and their families and threatening them with jail time or other legal consequences (see Banking and Finance Law Daily, Nov. 5, 2024). Now, shortly after the FTC filed an amended complaint, the FTC announced on May 1, 2025, that the parties have agreed to resolve the litigation. According to the parties’ “Stipulated Motion to Enter into Order for Permanent Injunction and Monetary Judgment,” GCI and Redon, without admitting or denying any wrongdoing: (i) must pay a monetary judgment of $9,684,338 (which will be suspended after Redon and GCI “turn over their remaining assets” and may be reinstated in full if “they are found to have lied about their finances”); (ii) are permanently banned from debt collection and debt brokering activities; (iii) are prohibited from misrepresenting any material fact related to the sale, promotion, or marketing of any good or service; (iv) are prohibited from misrepresenting their affiliation or connection to any person or business; and (v) are prohibited from violating the FTCs “Impersonation Rule” and the GLB Act (FTC v. Global Circulation, Inc., No. 1:24-cv-04927-TCB (N.D. Ga. Apr. 30, 2025)).

FINANCIAL STABILITY—The Federal Reserve System is seeking an unrevised renewal of the data collection for the “Market Risk Regulatory Report for Institutions Subject to the Market Risk Capital Rule,” according to the May 2, 2025, Federal Register notice. The public has until July 1st to comment on aspects of the renewal—such as the applicability of the survey to its purported goals and the accuracy of an estimated annual burden of 1,968 hours at the Fed, 48 hours at the Federal Deposit Insurance Corporation, and 768 hours at the Office of Comptroller of the Currency.

OVERSIGHT AND INVESTIGATION—The Office of Inspector General (OIG) for the Federal Reserve Board and the Consumer Financial Protection Bureau released its periodic report on unimplemented recommendations at the Fed. The report shows, as of March 31, 2025, the total number and status of recommendations made to the Fed by calendar year, beginning with the first year for which one or more recommendations remain open.

OVERSIGHT AND INVESTIGATION—The Office of Inspector General (OIG) for the Federal Reserve Board and the Consumer Financial Protection Bureau released its periodic report on unimplemented recommendations at the CFPB. The report shows, as of March 31, 2025, the total number and status of recommendations made to the CFPB by calendar year, beginning with the first year for which one or more recommendations remain open.

OVERSIGHT AND INVESTIGATION—The U.S. Government Accountability Office’s (GAO’s) most recent report on federal civil penalties has determined that, in 2024, all 49 federal agencies complied with the laws mandating inflation adjustments to civil penalty amounts. Along these lines, the GAO reported that the federal agencies published their updated penalty amounts in the Federal Register and included related information in their financial reports, in keeping with the requirements of the Federal Civil Penalties Inflation Adjustment (FCPIA) Act. In keeping with federal law, since 2015, the GAO has conducted an annual review of agency compliance with the FCPIA Act. The Office of Management and Budget made no comments on the GAO’s April 2025 report prior to its publication.

RECEIVERSHIPS—7th Cir.: The U.S. Court of Appeals for the Seventh Circuit has upheld the dismissal of a lawsuit brought under the Federal Tort Claims Act (FTCA) by a pair of loan borrowers against the U.S. Government in connection with the Federal Deposit Insurance Corporation acting as the receiver for Premier Bank, a failed bank that was accused of “engaging in fraudulent lending practices.” Under the facts of the case, the borrowers had some business loans with Premier Bank that were “secured by mortgages on their personal real estate.” While the borrowers “consistently maintained” that their loans with Premier Bank were “fraudulent and unenforceable,” the FDIC eventually sold some of the failed bank’s loans to Amos Financial. The borrowers alleged not only that their loans were included as part of this sale, but also that the FDIC “was aware of the fraudulent nature of the loans at the time of the sale and failed to take remedial action”—resulting in common-law torts and violations of the FTCA. Affirming the federal district court’s decision granting the U.S. Government’s motion to dismiss the borrowers’ claims against it, the Seventh Circuit determined that the borrowers “failed to timely exhaust their administrative remedies for most of their claims, and their only timely claim is barred under the FTCA’s intentional torts exception” (Dernis v. USA, No. 23-2821 (7th Cir. May 1, 2025)).

Attorneys: Allen Howard Shapiro (SWK Attorneys At Law) for George Dernis. Sarah Terman, Office of the United States Attorney, for the United States of America. Sarah T. Abutaleb and Gregory A. Ashe for the Federal Trade Commission. William Newman and Paul Strickland for Global Circulation, Inc. and Kenneth Redon, III.

Companies: Amos Financial; Global Circulation, Inc.; Premier Bank; Shinhan Bank America

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