FDIC Stomps On Civil Money Penalties Insurance

This note was just sent to my email list of bankers…

I have been expecting action by the FDIC on the issue of Civil Money Penalties (CMP) for some time now. This one is not subtle.

Actually, I expected the FDIC to start hitting banks buying CMP with civil money penalties. (Wink)

For about a year now I have been urging my clients not buy CMP insurance – this is exactly why.

Here is today’s FDIC notice. Not much room for misunderstanding.

Readers who are clients… 

We undoubtably have talked about the CMP issue. Glad to talk again. Give me a shout and we can talk. Even if it has been several years since we worked together, give me a call. I’ll give you my take, review your current policies, and you can make an informed insurance decision.

Readers who are not clients (yet)…  

Send me your directors’ and officers’ insurance policy and I will review it for two items – CMP coverage and a regulatory exclusion. My fee is $500. You’ll get a letter from me about how your policy responds to these two issues. You can share with your directors and your regulators. The fee paid for this will go towards any future project you engage me in over the next twelve months. Use this as a test of how I work. Better yet, just hire me now for a full review of your insurance. Either way, we will cover the idea of civil money penalties for the sake of your comfort and that of your board.

Always glad to talk.

Regards,
Scott

Scott Simmonds, CPCU, ARM
Unbiased Bank Insurance Consulting
Phone: 207-284-0085
20 Sofia Road, Saco, Maine  04072-9017

Visit my website http://www.bankinsuranceconsultant.com
Consulting On, But Never Selling, Insurance