Skip to content
Thread Options Tools
#45235 - 11/22/02 09:05 PM Reg. O
HR Banker Offline
Diamond Poster
Joined: Oct 2002
Posts: 1,027
Does Reg. O, or any other Reg. prohibit an executive officer or director from bidding at a public auction on property owned by the bank?

Return to Top
General Discussion
#45236 - 11/22/02 09:21 PM Re: Reg. O
Nanwa Offline
Power Poster
Joined: Oct 2001
Posts: 5,564
Clintonville, WI, USA
I'm not sure, but it had better be an arm's length transaction, that can be documented as such, because it could have the appearence of insider knowledge or preferential treatment.
Member of the National Sarcasm Society - like we need your support!

Return to Top
#45237 - 11/22/02 09:28 PM Re: Reg. O
Andy_Z Offline
10K Club
Joined: Oct 2000
Posts: 27,502
On the Net
I don't believe it would so long as it is a bona fide public auction under applicable rules.
My opinions are not necessarily my employers.
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell

Return to Top
#45238 - 11/22/02 09:33 PM Re: Reg. O
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,839
Bloomington, IN
I agree with Andy. Reg. O primarily deals with the extension of credit to an insider, and as long as you are not financing the transaction, I do not think Reg. O comes into play.

I'd like to also re-emphazie Nanwa comment about it being a arm's length tranaction.

The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top
#45239 - 11/22/02 09:33 PM Re: Reg. O
redsfan Offline
Power Poster
Joined: Dec 2000
Posts: 3,455
The Pennant Race
In my last life, that was the only way a director (or any employee, for that matter) could acquire bank-owned property, although we did make an exception for a branch that had potential environmental problems the director agreed to assume.

The theory is that a public sale is arms length true market value. That theory could be turned on its head if your director knew your bidding strategy for the property, or what the outstanding balance was on a loan secured by the property, though.
The opinions expressed here are personal and do not represent opinions of my employer.

Return to Top