Handling A HUD Investigation
Answers by Richard Insley and Lucy Griffin, BOL Gurus
Question: Is HUD considered to be a supervisory agency of our bank, an Oklahoma State Fed Member bank, in regard to the Federal Right to Financial Privacy Act? In connnection with a complaint from a former customer they want a list of all our loans for the past 2 years that we have demanded payment in full for.
Answer by Richard Insley BIO AND CONTACT INFO
You're under investigation and need to engage experienced legal counsel.
Answer by Lucy Griffin: BIO AND CONTACT INFO
When HUD investigates you, you should have counsel involved. That being said, the answer to your question is yes and no. The RFPA applies to all government authorities. This is defined as "any agency or department of the U.S." A supervisory agency is defined as one which has authority to examine the institution. So HUD is a government authority but not a supervisory agency.
Government authorities such as HUD must produce proper authorization to access any customer records unless the customer in question has given permission. Since HUD is on a fishing expedition looking for names, they clearly don't have each customer's permission. Therefore, they need to produce an appropriate legal document such as an administrative subpena in order to have access to the records.
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