Badger Bank penalized for flood insurance violations
The FDIC has issued an Order to Pay a Civil Money Penalty of $19,600 to Badger Bank, Fort Atkinson, Wisconsin, after determining that the bank has engaged in a pattern or practice of committing violations of the Flood Disaster Protection Act and the notice requirements of the National Flood Insurance Act, and part 339 of the FDIC's Rules and Regulations.
The FDIC found that the bank:
- failed to obtain flood insurance on a building securing a designated loan at the time of the origination of four loans
- failed to obtain adequate flood insurance for five loans
- failed to maintain flood insurance for three loans
- failed to require the escrow of all premiums and fees for required flood insurance when it required the escrow of taxes, insurance premiums, fees or any other charges for a loan secured by residential improved real estate for three loans
- failing to follow force placement flood insurance procedures for five loans
- failing to provide to borrowers a Notice of Special Flood Hazard and Availability of Federal Disaster Relief (NSFH notice) on six occasions
- failing to provide an NSFH notice within a reasonable time before completion of one transaction.