1155.02 Cease-and-desist order.

(A)

(1) If, in the opinion of the superintendent of savings and loan associations, an association or a person has failed to comply with a supervisory agreement, is engaging or has engaged or the superintendent has reasonable cause to believe that the association or person is about to engage in any unsafe or unsound practice in conducting the business of the association, or has knowingly participated in or consented to or the superintendent has reasonable cause to believe that the association or person is about to participate in or consent to a violation of Chapter 1151., 1153., 1155., or 1157. of the Revised Code, he may serve such association or person notice that he is considering issuing an order on such association pursuant to division (A)(2) or (3) of this section. As used in this section, "person" means a director, officer, employee, or controlling person of an association.

(2) A notice served under division (A)(1) of this section that relates to matters other than an alleged violation of a supervisory agreement shall contain a statement of the alleged facts constituting the basis for an order and fix a time and place for a hearing. The hearing shall be conducted in accordance with section 119.09 of the Revised Code, except that, notwithstanding division (E) of section 119.01 of the Revised Code, the hearing shall not be a public hearing. The date for the hearing shall be not less than thirty nor more than forty-five days after such notice has been made by the superintendent on the association or person.

If, after conducting such hearing, the superintendent determines that the association or person has knowingly participated in or consented to or is about to participate in or consent to a violation of Chapter 1151., 1153., 1155., or 1157. of the Revised Code, is engaging or has engaged or is about to engage in an unsafe or unsound practice, he may issue a final cease-and-desist order. Such final cease-and-desist order may direct the association or person to remedy the violation of Chapter 1151., 1153., 1155., or 1157. of the Revised Code, or the unsafe or unsound practice, in addition to refraining from such violations or unsafe or unsound practices in the future.

Such final order becomes effective upon service on the association or person and remains effective and enforceable as provided therein, except to such extent as it is stayed, modified, terminated, or set aside by action of the superintendent or a reviewing court pursuant to section 119.12 of the Revised Code.

(3) If the superintendent proposes to issue a cease-and-desist order based on the violation of a supervisory agreement, he shall serve the association or person with a notice of noncompliance. Such notice shall specify the actions that are alleged to be in violation of the supervisory agreement. The notice shall also set a time and place for a hearing, which shall occur not less than thirty nor more than forty-five days after the notice has been served on the association or person. The hearing shall be conducted in the manner prescribed in section 119.09 of the Revised Code, except that, notwithstanding division (E) of section 119.01 of the Revised Code, such hearing shall not be a public hearing.

If, after such hearing, the superintendent determines that the association or person has knowingly violated the supervisory agreement, he may issue a final cease-and-desist order.

If, after such hearing, the superintendent determines that the association or person has violated the supervisory agreement but that the conduct in question does not constitute a knowing violation, the superintendent shall give the association or person an opportunity to remedy the violation. The superintendent shall issue a statement of specific actions that must be taken by the association or person, and establish a time frame in which the association or person must take such corrective action to comply with the supervisory agreement. If, by the end of such time frame, the association or person has failed to implement the corrective actions required by the superintendent, the superintendent may issue a final cease-and-desist order.

Nothing in this division shall be construed to prevent the superintendent from issuing a cease-and-desist order pursuant to divisions (A)(1) and (2) of this section or division (B) of this section based on the violation of Chapter 1151., 1153., 1155., or 1157. of the Revised Code, or on an unsafe or unsound practice of the association or person, even though such violation or practice may also constitute a violation of an outstanding supervisory agreement.

(B) If, in the opinion of the superintendent, an association or person is engaging or has engaged in any unsafe or unsound practice, or has participated in or consented to a violation of Chapter 1151., 1153., 1155., or 1157. of the Revised Code, or if the superintendent has reasonable cause to believe that the association or person is about to engage in an unsafe or unsound practice or has consented to a violation of Chapter 1151., 1153., 1155., or 1157. of the Revised Code, he may issue a summary order requiring the association or person to cease and desist from any such violation or practice.

Such summary cease-and-desist order, which shall contain a statement of the facts allegedly constituting the grounds for the order, shall be served upon the association or person and shall become effective upon receipt. The order shall include notification of the time and place of a hearing which shall be held pursuant to division (A)(2) of this section. Unless the superintendent issues a final order within ten days after conclusion of such hearing, the summary order issued pursuant to this division becomes void. Otherwise, such summary order remains effective and enforceable until replaced by such final order, except to such extent as it is stayed, modified, terminated, or set aside by action of the superintendent.

(C) An association or person who is adversely affected by a final cease-and-desist order may appeal from the order to the court of common pleas in accordance with section 119.12 of the Revised Code.

(D) In lieu of a hearing pursuant to division (A) or (B) of this section, an association or person may consent to the issuance of an order requiring such association or person to cease and desist from engaging in any activity or practice as specified in such order. A consent cease-and-desist order has the full force and effect of a final cease-and-desist order issued pursuant to division (A)(2) of this section and is enforceable in accordance with division (E) of this section. Any association or person that fails to attend a hearing set pursuant to division (A) or (B) of this section is deemed to have consented to the issuance of a final cease-and-desist order.

(E) If, in the opinion of the superintendent, he has reasonable cause to believe that a lawful summary or final order issued pursuant to this section has been violated, he may request the attorney general to commence and prosecute any appropriate action or proceeding. A court of competent jurisdiction shall enforce a lawful summary or final order issued pursuant to this section and may grant such other relief as the facts warrant.

(F) Service on any association or person as provided for in this section shall be by actual written notice or certified mail to the person or, in the case of an association, to the managing officer of such association.

Cite as R.C. § 1155.02

History. Effective Date: 07-14-1987