Books and accounts; division's control.
Attorney general, duty of.
Copies as evidence.
Effect of consolidating banks and trust companies.
Bank or corporate notaries; permitted acts.
Destruction of obsolete records by state banks.
Reproduction and destruction of records; evidence.
Closing in emergencies.
Transfer of trust business within bank holding company groups.
Unless the context requires otherwise, the term "bank" means any banking institution incorporated under the laws of this state.
"Department" means the department of financial institutions.
"Division" means the division of banking.
The term "lawful money" means all forms of money issued by or under the authority of the United States as a circulating medium, and includes any form of certificate declared to be lawful money by any law of the United States.
History: 1983 a. 189
; 1991 a. 221
; 1993 a. 213
; Stats. 1993 s. 220.01; 1995 a. 27
; 1997 a. 191
Division; duties. 220.02(2)(2)
The division shall enforce all laws relating to banks and banking in this state, and shall enforce and cause to be enforced every law relating to the supervision and control thereof, including those relating to:
State banks under this chapter and ch. 221
and trust company banks under ch. 223
The lending of money under s. 138.09
, or those relating to finance companies, motor vehicle dealers, adjustment service companies, community currency exchanges and collection agencies under ch. 218
It is the intent of sub. (2)
to give the division jurisdiction to enforce and carry out all laws relating to banks or banking in this state, including those relating to state banks, savings banks, savings and loan associations, and trust company banks, and also all laws relating to small loan companies or other loan companies or agencies, finance companies, insurance premium finance companies, motor vehicle dealers, adjustment service companies, community currency exchanges, mortgage bankers, mortgage loan originators, mortgage brokers, and collection agencies and those relating to sellers of checks under ch. 217
, whether doing business as corporations, individuals, or otherwise, but to exclude laws relating to credit unions.
Except for acts and decisions of the division under chs. 138
, any interested person or any bank or banking corporation aggrieved by an act, order or determination of the division may, within 10 days from the date thereof, apply to the banking review board to review the same. All such applications for review shall be considered and disposed of as speedily as possible. The banking review board may require the division to submit any of the division's actions subject to such review to said board for its approval.
See also DFI-Bkg
, Wis. adm. code.
Banking review board. 220.035(1)(a)(a)
The banking review board shall advise the division and others in respect to improvement in the condition and service of banks and banking business in this state and shall review the acts and decisions of the division with respect to banks, except for such acts and decisions of the division under chs. 138
, and shall perform such other review functions in relation to banking as are provided by law. The banking review board may require the division to submit any of the division's actions to it for its approval. The board may make rules of procedure as provided in ch. 227
Any interested person aggrieved by any act, order or determination of the division may apply for review thereof by filing a petition with the secretary of the board within 10 days after the act, order or determination to be reviewed, which petition shall state the nature of the petitioner's interest, facts showing that petitioner is aggrieved and directly affected by the act, order or determination to be reviewed and the ground or grounds upon which petitioner claims that the act, order or determination should be modified or reversed. The issues raised by the petition for review shall be considered by the board upon giving at least 10 days' written notice of the time and place when said matter will be heard to the division and the person applying for review or that person's attorney and upon any other person who participated in the proceedings before the division or that other person's attorney. Notice of hearing may be given by registered mail, return receipt requested, and the return receipt signed by the addressee or the addressee's agent shall be presumptive evidence that such notice was received by the addressee on the day stated on the receipt. Any other interested party shall have the right to appear in any proceeding before the board.
The board shall base its determination upon the record made by the division and may also receive additional evidence to supplement such record if it finds it necessary. The board shall affirm, modify or reverse the act, order or determination under review. The burden of overcoming the act, order or determination of the division under review shall be on the person seeking the review. Any findings of fact made by the division shall be sustained if supported by substantial evidence in the record made by the division or in such record supplemented by evidence taken by the board. The board shall have the powers granted by s. 885.01 (4)
. Any person causing a witness to be subpoenaed shall advance and pay the fees and mileage of such witness which shall be the same as in circuit court. The fees and mileage of witnesses who are called at the instance of the division shall be paid by the state in the same manner that other expenses are audited and paid upon presentation of properly verified vouchers approved by at least one member of the board and charged to the appropriation of the division.
Each member of the board and all employees of the board shall, with respect to the disclosure of information concerning banks, be subject to the same requirements and penalties as the employees of the division.
The banking review board may make rules and regulations to safeguard the interest of depositors and stockholders generally in emergencies.
Any final order or determination of the banking review board shall be subject to review in the manner provided in ch. 227
The board shall have an office in the quarters of the division. The board's secretary shall keep a record of the meetings of the board and of all hearings, decisions, orders and determinations of the board. The board may make reasonable rules not inconsistent with law as to the time of meetings, time of hearings, notice of hearings and manner of conducting same and of deciding the matters presented. The board may direct that hearings and testimony be taken by any member of the board or by an examiner designated by the board.
The board may employ assistance necessary in the performance of its work and fix reasonable compensation therefor, subject to any statutes applicable thereto.
Any bank whose assets, upon the basis of a fair valuation, are equal to or in excess of its liabilities exclusive of capital stock, preferred stock, capital notes and debentures, shall be deemed to be safe and solvent. The banking review board may prescribe schedules, rules and regulations for arriving at a fair valuation of various classes of assets of banks.
See also ch. DFI-Bkg 10
, Wis. adm. code.
The remedy under sub. (3) is exclusive when contested issues of public interest and constitutionality could have been remedied on administrative review. First National Bank of Wisconsin Rapids v. M & I Peoples Bank of Coloma, 82 Wis. 2d 529
, 263 N.W.2d 196
Powers of division. 220.04(1)(a)(a)
The division shall examine at least once every 18 months the cash, bills, collaterals, securities, assets, books of account, condition and affairs of each bank and trust company bank doing business in this state, except national banks. For that purpose the division may examine on oath any of the officers, agents, directors, clerks, stockholders, customers or depositors thereof, touching the affairs and business of such institution. In making such examinations of banks, the division shall determine the fair valuation of all assets in accordance with the schedules, rules and regulations prescribed by the banking review board.
In lieu of any examination required to be made by the division, the division may accept any examination that may have been made of any bank or trust company bank within a reasonable period by a bank supervisory agency, as defined in s. 221.0901 (2) (d)
, if a copy of the examination is furnished to the division.
The division shall examine, or cause to be examined, any bank when requested by the board of directors of such bank. The division shall also ascertain whether such bank transacts its business at the place designated in the articles of incorporation, and whether its business is conducted in the manner prescribed by law.
The division may, in the performance of official duties, issue subpoenas and administer oaths. In case of any refusal to obey a subpoena issued by the division, the refusal shall be reported at once to the circuit court of the circuit in which the bank is located. The court shall enforce obedience to the subpoena in the manner provided by law for enforcing obedience to subpoenas of the court.
Whenever the division is of the opinion that the loaning, investing or other banking policies or practices of any officer or director of any bank have been prejudicial to the best interests of such bank or its depositors, or that such policies or practices, if put into operation or continued, will endanger the safety or solvency of said bank or impair the interests of its depositors, the division may, with the approval of the banking review board, request the removal of such officer or director. Such request shall be served on the bank and on such officer or director in the manner provided by law for serving a summons in a court of record or shall be transmitted to said bank and officer or director by registered mail with return receipt requested. If such request for removal is not complied with within a reasonable time fixed by the division, the division may by order, with like approval of the banking review board, remove such officer or director, but no order of removal shall be entered until after an opportunity for hearing before the banking review board is given to such officer or director upon not less than 10 days' notice. An order of removal shall take effect as of the date issued. A copy of such order shall be served upon the bank and upon such officer or director in the manner provided by law for service of a summons in a court of record or by mailing such copy to the bank or officer or director at the bank's or officer's or director's last-known post-office address. Any removal under this subsection shall be effective in all respects the same as if made by the board of directors or stockholders of said bank. Any officer or director removed from office under the provisions of this subsection shall not be reelected as an officer or director of any bank without the approval of the division and the banking review board. An order of removal under this subsection shall be deemed a final order or determination of the banking review board within the meaning and contemplation of s. 220.035 (3)
The division, in connection with the liquidation of any bank or banking corporation or when called upon to approve any plan of reorganization and stabilization thereof or when the division is satisfied the interests of the depositors and creditors in assets held under any trust arrangement so require in connection with such reorganization and stabilization, may cause the bank or banking corporation or trust to be audited. The expense of the audit shall, upon the certificate of the division, be refunded forthwith to the division by the bank, banking corporation or the trustees out of the assets of the bank, banking corporation or trust. Such charges shall be a preferred claim against the assets.
The division, with the approval of the banking review board, may establish uniform savings rules which shall be adopted by every bank and trust company bank. Such rules may provide the conditions under which banks or trust company banks may accept deposits.
In times of financial distress, the commissioner with the approval of the banking review board may by order restrict the withdrawal of any class of deposits in any bank or trust company bank. The pendency of any proceeding for review of such order shall not stay or suspend the operation of such order.
The division, with the approval of the banking review board, may establish rules regulating the kind and amount of foreign bonds or bonds and securities offered for sale by the international bank for reconstruction and development, the inter-American development bank, the international finance corporation, the African development bank and the Asian development bank which state banks and trust company banks may purchase, except that such rules shall not apply to bonds and securities of the Canadian government and Canadian provinces, which are payable in American funds.
"Fiduciary property" means that property held by an organization as trustee or in any fiduciary capacity requiring the issuance of letters by a court or probate registrar in this state.
The division may, with the approval of the banking review board, establish uniform rules regulating organizations engaging in fiduciary operations. Such rules may:
Authorize the division or any other state agency having jurisdiction over the organization to require the organization to submit periodic reports, in such form and containing such information as the division may prescribe, regarding the organization's fiduciary operations.
Require the organization to maintain separate books of account for its fiduciary operations and to maintain fiduciary property separate from the property of the organization.
Require the organization to maintain reasonable safeguards to protect fiduciary property including the maintenance of an indemnity fund in the same manner as that required of trust company banks under s. 223.02 (1)
Unless the division is expressly restricted by statute from acting under this subsection with respect to a specific power, right or privilege, the division by rule may, with the approval of the banking review board, authorize state banks to exercise any power under the notice, disclosure or procedural requirements governing national banks or to make any loan or investment or exercise any right, power or privilege permitted national banks under federal law, regulation or interpretation. Notice, disclosure and procedures prescribed by statute which may be modified by a rule adopted under this subsection include, but are not limited to, those provided under s. 138.056
. A rule adopted under this subsection may not affect s. 138.041
or chs. 421
or restrict powers specifically granted state banks under this chapter or ch. 221
"Official" means a director, officer, employee or agent of a regulated entity or any other person which participates in the conduct of the affairs of a regulated entity.
"Regulated entity" means a bank, universal bank, trust company bank, and any other entity that is described in s. 220.02 (2)
as under the supervision and control of the division.
Notice of hearing.
The division may serve a notice of a hearing which complies with s. 227.44 (1)
on an official or regulated entity if, as a result of an examination or report made to the division, the division determines any of the following:
The official or regulated entity is violating or is about to violate the banking laws of this state or any rule or order issued by the division.
The regulated entity is being operated in an unsafe or unsound manner.
An official is violating or is about to violate a written condition which the division imposed in connection with granting an application or request by the regulated entity, or a written agreement entered into with the division.
Cease and desist order.
If the recipient of a notice of hearing fails to appear or if upon the record made at the hearing the division finds that a violation or unsafe or unsound practice has been established, the division may issue and serve on the official or regulated entity an order to cease and desist from the violation or practice. The order may require the official or regulated entity to correct the conditions resulting from the violation or practice. An order issued under this paragraph is effective upon service on the official or regulated entity named in the order and may be appealed under s. 220.035
If the division finds that a violation or practice described in par. (b)
is likely to cause insolvency or substantial dissipation of assets or earnings of the regulated entity or seriously prejudice the interests of its depositors, the division may issue a temporary order requiring the official or regulated entity named in the notice of hearing to cease and desist from the violation or practice and to take affirmative action to prevent insolvency, dissipation of assets or earnings or prejudice to depositors pending completion of the proceedings. The temporary order is effective upon service on the official or regulated entity named in the notice of hearing and remains effective and enforceable pending completion of the administrative proceedings unless suspended, set aside or limited by a court as provided in subd. 2.
Within 20 days after an official or regulated entity is served with a temporary order under subd. 1.
, the official or regulated entity may apply to the circuit court for the county within which the regulated entity is located for an injunction setting aside, limiting or suspending the enforcement of the order pending the completion of the administrative proceeding.
As part of an order issued under par. (d)
, the division may impose a forfeiture of up to $10,000 for each violation or practice under par. (b)
An official or regulated entity who violates an order issued under par. (d)
shall, for each violation, forfeit not more than $1,000 per day for each day the violation continues. Assessment of a forfeiture under this subdivision shall commence on the latest of 10 days after the date of delivery of the order or, if an appeal is taken under s. 220.035
, 10 days after the date of the decision of the banking review board.
The division may institute proceedings to recover a forfeiture under par. (f)
or to enjoin the violation of an order issued under par. (d)
and, after notice and opportunity for a hearing as provided in sub. (4)
, may order the removal of an official who commits a violation or engages in a practice under par. (b)
or who violates an order issued under par. (d)
, if the division finds that the practice or violation involves personal dishonesty resulting in financial gain to the official or demonstrates a willful or continuing disregard for the safety or soundness of the regulated entity, and the division finds any of the following:
As a result of the practice or violation the regulated entity has suffered or will probably suffer substantial financial loss or other damage.
The interests of the depositors could be seriously prejudiced by the violation or practice.
If it appears to the division that a person has engaged or is about to engage in an act or practice constituting a violation of the laws of this state relating to banks and banking, including this chapter, chs. 217
and ss. 138.09
, and 138.14
, or a rule promulgated or order issued under those laws, the division may bring an action in the name of the state in the circuit court of the appropriate county to enjoin the acts or practices and to enforce compliance with the laws, rules or orders, or the division may refer the matter to the district attorney of the appropriate county or, if the alleged violation may be enforced by the attorney general under sub. (12)
or s. 220.12
or 224.06 (7)
or is statewide in nature, to the attorney general. Upon a proper showing, the court may grant a permanent or temporary injunction or restraining order, appoint a receiver for the defendant or the defendant's assets or order rescission of any acts determined to be unlawful. The court may not require the division to post a bond.
In order to carry out ss. 220.07
, the division may commence and maintain in the division's name any and all actions necessary or proper to enforce any of said sections.