§ 3101.108 Additional rules for Office of the Comptroller of the Currency employees. The following rules apply to the employees of the Office of the Comptroller of the Currency and are in addition to §§ 3101.101-3101.104: ( a ) *Prohibited financial interests* — ( 1 ) *Prohibition.* Except as provided in paragraphs (a)(3) and (g) of this section, no OCC employee, or spouse or minor child of an OCC employee, shall own, directly or indirectly, securities of any commercial bank (including both national and state-chartered banks), Federal savings association, state savings association, or of any affiliate of these institutions (including bank holding companies, savings and loan holding companies, and non-bank subsidiaries of either type of holding company), or of any foreign bank.
( 2 ) *Definition of “securities”.* For purposes of paragraphs (a)(1) and (a)(3) of this section, the term “securities” includes all interests in debt or equity instruments. The term includes, without limitation, secured and unsecured bonds, debentures, notes, securitized assets and commercial paper, as well as all types of preferred and common stock. The term encompasses both current and contingent ownership interests, including any beneficial or legal interest derived from a trust. It extends to any right to acquire or dispose of any long or short position in such securities and includes, without limitation, interests convertible into such securities, as well as options, rights, warrants, puts, calls, and straddles with respect thereto.
( 3 ) *Exceptions.* Nothing in this section prohibits an OCC employee, or spouse or minor child of an OCC employee, from: ( i ) Owning an interest in a publicly traded or publicly available mutual fund, other collective investment fund or pooled investment product, or a widely-held pension or other similar fund if the fund does not have a stated policy of concentration in the financial services industry and neither the employee nor the employee's spouse exercises or has the ability to exercise control over the financial interests held by the fund or the selection of fund holdings;
( ii ) Owning securities in a publicly traded company owning banks or savings associations if— ( A ) By virtue of the limited activities of the banks or savings associations, the ownership of banks or savings associations does not cause their parent holding company to become a bank holding company under the Bank Holding Company Act of 1956, *12 U.S.C. 1841* et seq, (for example, a bank engaged only in credit card activities);
( B ) For savings and loan holding companies, the ownership or operation of savings associations is not a significant activity (generally less than 15% of the assets) of the holding company;
( C ) The company is identified as meeting the requirements of (A) or (B) above on a list maintained by the OCC Ethics Counsel; and
( D ) The employee owning or seeking to purchase the securities does not participate in the regulation or supervision of any bank or savings association owned or operated by the company;
( iii ) Owning the securities of a foreign bank that does not own a commercial bank or savings association in the United States provided that the employee owning the securities does not participate in the regulation or supervision of any Federal branch or agency operated by the foreign bank;
( iv ) Using a commercial bank, a savings association or an affiliate of a commercial bank or savings association as custodian or trustee of accounts containing tax-deferred retirement funds; or
( v ) Owning any security pursuant to a waiver granted under paragraph (g) of this section.
( b ) *Prohibited borrowing* — ( 1 ) Prohibition on employee borrowing. Except as provided in this section, no covered OCC employee shall seek or obtain credit from any national bank or Federal savings association or from any officer, director, employee or subsidiary of a national bank or Federal savings association.
( 2 ) *Prohibition on borrowing by a spouse or minor child.* The prohibition in paragraph (b)(1) of this section shall apply to the spouse or minor child of a covered OCC employee unless the loan or extension of credit: ( i ) Is supported only by the income or independent means of the spouse or minor child;
( ii ) Is obtained on terms and conditions no more favorable than those offered to the general public; and
( iii ) The covered OCC employee does not participate in the negotiation for the loan or serve as co-maker, endorser, or guarantor of the loan.
( 3 ) *Covered OCC employee.* For purposes of the prohibitions on borrowing contained in paragraphs (b)(1) and (b)(2) of this section, “covered OCC employee” means: ( i ) An OCC examiner; and
( ii ) Any other OCC employee specified in an OCC instruction or manual issuance whose duties and responsibilities, as determined by the Comptroller of the Currency or his or her designee, require application of the prohibition on borrowing contained in this section to ensure public confidence that the OCC's programs are conducted impartially and objectively.
( 4 ) *Exceptions* — ( i ) *Credit cards.* A covered OCC employee or the spouse or minor child of such a covered OCC employee may seek, obtain or hold a credit card from a national bank, a Federal savings association or a subsidiary of a national bank or Federal savings association if— ( A ) The applicant satisfies all financial requirements set by the lender that are generally applicable to all applicants for the same type of credit card account;
( B ) The terms and conditions applicable with respect to the credit card account and any credit extended under the account are no more favorable generally to the applicant than the terms and conditions that are generally applicable to credit card accounts offered by the same lender to other cardholders in comparable circumstances;
( C ) An employee who holds a credit card (or whose spouse or minor child holds a credit card) must submit a written recusal notice to his or her supervisor and ethics official if the cardholder becomes involved in an adversarial dispute with the issuer of the credit card account. A cardholder is involved in an adversarial dispute if he or she is delinquent in payments on the credit card account; the issuer and the cardholder are negotiating to restructure the credit card debt; the cardholder disputes the terms and conditions of the account; or the cardholder becomes involved in any disagreement with the issuer that may cast doubt on the employee's ability to remain impartial with respect to the issuer.
( ii ) *Loans secured by principal residence.* A covered OCC employee or the spouse or minor child of a covered OCC employee may seek and obtain a loan from a national bank, a Federal savings association or a subsidiary of a national bank or Federal savings association subject to the following conditions: ( A ) The loan is secured by residential real property that is the applicant's principal residence;
( B ) The applicant must satisfy all financial requirements set by the lender for the residential real property loan that are generally applicable to borrowers for the same type of residential real property loan; and
( C ) The terms and conditions applicable with respect to the residential real property loan and any credit extended under the loan must be no more favorable generally to the applicant than the terms and conditions that are generally applicable to residential real property loans offered by the same lender to other borrowers in comparable circumstances.
( iii ) A covered employee who seeks or obtains a real property loan from a national bank, Federal savings association or a subsidiary of a national bank or Federal savings association or whose spouse or minor child obtains a real property loan under the requirements of paragraph (b)(4)(ii) above must observe from the time of the initial application any recusal established under OCC ethics policy.
( 5 ) *Pre-existing credit.* ( i ) This section does not prohibit a covered OCC employee, or spouse or minor child of a covered OCC employee from retaining a loan or extension of credit from a national bank or Federal savings association on its original terms, and subject to any recusal established under OCC ethics policy, if the loan or extension of credit: ( A ) Was incurred prior to employment by the OCC;
( B ) Was obtained from a lender that was not supervised by the OCC at the time it was obtained; or
( C ) Is held by a national bank or Federal savings association or subsidiary thereof as the result of the sale or transfer of a loan to the national bank or Federal savings association or the conversion or merger of the lender into a national bank or Federal savings association.
( ii ) Any renewal or renegotiation of a pre-existing loan or extension of credit will be treated as a new loan subject to the prohibitions in paragraph (b)(1) of this section.
( c ) *Restrictions arising from third party relationships.* If any of the entities listed in paragraphs (c)(1) through (c)(7) of this section have securities that an OCC employee would be prohibited from having by paragraph (a) of this section, or loans or extensions of credit that a covered OCC employee would be prohibited from obtaining under paragraph (b) of this section, the employee shall promptly report such interests to the Chief Counsel or designee. The Chief Counsel or designee may require the employee to terminate the third party relationship, undertake an appropriate disqualification, or take other appropriate action necessary, under the particular circumstances, to avoid a statutory violation or a violation of part 2635 of this title, or this part, including an appearance of misuse of position or loss of impartiality. This paragraph applies to any: ( 1 ) Partnership in which the employee, or spouse or minor child of the employee, is a general partner;
( 2 ) Partnership in which the employee, or spouse or minor child of the employee, individually or jointly holds more than a 10 percent limited partnership interest;
( 3 ) Closely held corporation in which the employee, or spouse or minor child of the employee, individually or jointly holds more than a 10 percent equity interest;
( 4 ) Trust in which the employee, or spouse or minor child of the employee, has a legal or beneficial interest;
( 5 ) Investment club or similar informal investment arrangement between the employee, or spouse or minor child of the employee, and others;
( 6 ) Qualified profit sharing, retirement or similar plan in which the employee, or spouse or minor child of the employee, has an interest; or
( 7 ) Other entity if the employee, or spouse or minor child of the employee, individually or jointly holds more than a 25 percent equity interest.
( d ) *Prohibited recommendations.* Employees of the OCC shall not make recommendations or suggestions, directly or indirectly, concerning the acquisition or sale or other divestiture of securities of any commercial bank (including both national and state-chartered banks), Federal savings association, state savings association, affiliate of these institutions (including bank holding companies, savings and loan holding companies, and any non-bank subsidiaries of either type of holding company), or foreign bank that owns a commercial bank or savings association in the United States.
( e ) *Prohibited purchase of assets.* No employee of the OCC, or spouse or minor child of an OCC employee, shall purchase, directly or indirectly, an asset (*i.e.*, real property, automobiles, furniture, or similar items) from a national bank or Federal savings association or an affiliate of a national bank or a Federal savings association, including a bank or savings and loan holding company, unless it is sold at a public auction or by other means which ensure that the selling price is the asset's fair market value.
( f ) *Outside employment* — ( 1 ) *Prohibition on outside employment.* No covered OCC employee shall perform services for compensation for any bank, savings association or a bank or savings association affiliate, or for any officer, director or employee of, or for any person connected in any capacity with a bank, savings association or bank or savings association affiliate.
( 2 ) *Covered OCC employee.* For purposes of the prohibitions on outside employment contained in paragraph (f)(1) of this section, “covered OCC employee” means: ( i ) An OCC examiner; and
( ii ) Any other OCC employee specified in an OCC instruction or manual issuance whose duties and responsibilities, as determined by the Comptroller of the Currency or his or her designee, require application of the prohibition on outside employment contained in this section to ensure public confidence that the OCC's programs are conducted impartially and objectively.
( g ) *Waivers.* An agency designee may grant a written waiver from any provision of this section based on a determination made with the advice and legal clearance of the DAEO or Office of the Chief Counsel that the waiver is not inconsistent with part 2635 of this title or otherwise prohibited by law and that, under the particular circumstances, application of the prohibition is not necessary to avoid the appearance of misuse of position or loss of impartiality or otherwise to ensure confidence in the impartiality and objectivity with which agency programs are administered. A waiver under this paragraph may impose appropriate conditions, such as requiring execution of a written disqualification.
[60 FR 22251, May 5, 1995, as amended at 67 FR 46841, July 17, 2002; 79 FR 65878, Nov. 6, 2014]