West Virginia Code of State Rules › Agency 106 - Banking › Title 106 - LEGISLATIVE RULE COMMISSIONER OF FINANCIAL INSTITUTIONS › Series 106-18 - Legislative Rule Pertaining To Acquisition Of Property By Financial Institutions And Valuation Of Real Estate Owned By State-Chartered Banks › Section 106-18-7 - Prohibited Conduct at Foreclosure and OREO Sales by Directors, Officers, Employees and Affiliates of a Financial Institution

Current through Register Vol. XLI, No. 28, July 12, 2024
7.1. Participation As Purchaser -- No
				director, officer, employee or affiliate of a financial institution shall,
				either directly or indirectly, purchase property for sale as the result of the
				financial institution's foreclosure upon that property without the prior
				approval of the disinterested members of the board of directors of the
				institution. Provided, however, that such purchase may be made by the
				institution's directors, officers, employees or affiliates if it is made in the
				name of, and on behalf of, the institution foreclosing on the
				property.
7.2. Inside Information
				-- No director, officer, employee or affiliate of a financial institution
				shall, in connection with a public foreclosure sale to be conducted by their
				institution, provide any person with non-public inside information held by the
				institution for the purpose of assisting that person against others in making a
				foreclosure sale bid.
7.3.
				Beneficiary of Foreclosure Sale -- No director, officer, employee or affiliate
				of a financial institution shall conspire with another person to become the
				beneficial owner of property purchased by that other person at a foreclosure
				sale held by the institution. No prior agreement or arrangement shall be made
				whereby the director, officer, employee or affiliate of a financial institution
				pledges to purchase the foreclosed property from the buyer at a later date with
				the purpose of avoiding obtaining prior approval of the institution's board of
				directors as required in subsection 7.1 of this rule.
7.4. Prohibited Use of Property -- No
				director, officer, employee or affiliate of a financial institution shall use
				for any personal purpose other real estate owned by that institution. Nor shall
				they use the other real estate owned for any business purpose, except as
				permitted by the procedure in section 4.4 of this rule, or for incidental and
				temporary use related to the institution's business pending final disposition
				of the property, where the institution is endeavoring to make bona fide efforts
				to sell such property. Provided, however, that nothing in this rule prohibits a
				financial institution from collecting rent or lease payments from any
				third-party originally owed to the debtor for use of the property pending final
				disposition of the property, where the institution is endeavoring to make bona
				fide efforts to sell the property.
7.5. Participation as a Broker -- No
				director, officer, employee or affiliate of a financial institution shall
				accept or agree to accept, directly or indirectly, any brokerage fee in
				connection with the sale by that institution of other real estate
				owned.
7.6. Violation and Penalty
				-- Any person violating this section of the rule will be considered in
				violation of W. Va. Code '31A-8-3
				and will be subject to all the penalties provided therefore.