Thread Options
#2103988 - 10/20/16 09:32 PM Regulation O--- Spouse
Dodge Offline
100 Club
Joined: Mar 2010
Posts: 239
Spouse of an Executive Officer of the Bank applies for a loan in their name only. The collateral of the loan would be a Certificate of Deposit that is in the name of the spouse's only. The proceeds of the loan will go towards vacation that the spouse will take with the spouse's family.

Executive Officer is not a Borrower, not a owner of the collateral and will not go on vacation with their spouse.

Does Regulation O apply on the spouse?

The spouse is not a shareholder.

Return to Top
Lending Compliance
#2103994 - 10/20/16 10:00 PM Re: Regulation O--- Spouse Dodge
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 79,318
Galveston, TX
Community property state?? So, you are going to make the argument that this loan to the spouse in no way benefits the EO? Would he pay for the vacation otherwise? How is "the spouse" going to make the payments?

Very grey area.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2104122 - 10/21/16 06:22 PM Re: Regulation O--- Spouse Dodge
Dodge Offline
100 Club
Joined: Mar 2010
Posts: 239
Not a community property state. The wife has a job, so I believe she would repay the loan from the income she made there.

When in doubt code the loan as Regulation O and follow Regulation O guidelines?

Return to Top

Moderator:  Andy_Z