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12 U.S.C. § 5390 — Directors not liable for acquiescing in appointment of receiver
Federal law — U.S. Code and appendices · legal_authorities
The members of the board of directors (or body performing similar functions) of a covered financial company shall not be liable to the shareholders or creditors thereof for acquiescing in or consenting in good faith to the appointment of the Corporation as receiver for the covered financial company under [section 5383 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section5383&num=0&edition=prelim).
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Source file: Laws/federal/codes/united-states-code/title-12/section-5390-directors-not-liable-for-acquiescing-in-appointment-of-receiver--ae3d037d0f.md
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Source location: Title 12, Chapter 53, § 5390; chapter-053-wall-street-reform-and-consumer-protection.md
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The members of the board of directors (or body performing similar functions) of a covered financial company shall not be liable to the shareholders or creditors thereof for acquiescing in or consenting in good faith to the appointment of the Corporation as receiver for the covered financial company under [section 5383 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section5383&num=0&edition=prelim).
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Federal law — U.S. Code and appendices · legal_authorities
**(a) In general** The Secretary is authorized to promulgate regulations to implement and administer the grant programs and undertakings authorized by this subchapter.
**(b) Regulatory authority** Regulations prescribed under this section may contain such classifications, differentiations, or other provisions, and may provide for such adjustments and exceptions for any class of grant programs, undertakings, or eligible entities, as, in the judgment of the Secretary, are necessary or proper to effectuate the purposes of this subchapter, to prevent circumvention or evasion of this subchapter, or to facilitate compliance with this subchapter.
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 5301
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Federal law — U.S. Code and appendices · legal_authorities
No regulation or standard imposed under this subchapter may be construed in a manner that would lessen the stringency of the requirements of any applicable primary financial regulatory agency or any other Federal or State agency that are otherwise applicable. This subchapter, and the rules and regulations or orders prescribed pursuant to this subchapter, do not divest any such agency of any authority derived from any other applicable law.
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 5383
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Purpose of orderly liquidation authority** It is the purpose of this subchapter to provide the necessary authority to liquidate failing financial companies that pose a significant risk to the financial stability of the United States in a manner that mitigates such risk and minimizes moral hazard. The authority provided in this subchapter shall be exercised in the manner that best fulfills such purpose, so that—
(1) creditors and shareholders will bear the losses of the financial company;
(2) management responsible for the condition of the financial company will not be retained; and
(3) the Corporation and other appropriate agencies will take all steps necessary and appropriate to assure that all parties, including management, directors, and third parties, having responsibility for the condition of the financial company bear losses consistent with their responsibility, including actions for damages, restitution, and recoupment of compensation and other gains not compatible with such responsibility.
**(b) Corporation as receiver** Upon the appointment of the Corporation under [section 5382 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section5382&num=0&edition=prelim), the Corporation shall act as the receiver for the covered financial company, with all of the rights and obligations set forth in this subchapter.
**(c) Consultation** The Corporation, as receiver—
(1) shall consult with the primary financial regulatory agency or agencies of the covered financial company and its covered subsidiaries for purposes of ensuring an orderly liquidation of the covered financial company;
(2) may consult with, or under subsection (a)(1)(B)(v) or (a)(1)(L) of [section 5390 of this title](https://uscode.house.gov/view.xhtml?req=granule
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 5387
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Appointment of SIPC as trustee**
(1) **Appointment** — Upon the appointment of the Corporation as receiver for any covered broker or dealer, the Corporation shall appoint, without any need for court approval, the Securities Investor Protection Corporation to act as trustee for the liquidation under the Securities Investor Protection Act of 1970 ([15 U.S.C. 78aaa](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section78aaa&num=0&edition=prelim) et seq.) of the covered broker or dealer.
(2) **Actions by SIPC**
(A) *Filing* — Upon appointment of SIPC under paragraph (1), SIPC shall promptly file with any Federal district court of competent jurisdiction specified in section 78u or 78aa of title 15, an application for a protective decree under the Securities Investor Protection Act of 1970 ([15 U.S.C. 78aaa](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section78aaa&num=0&edition=prelim) et seq.) as to the covered broker or dealer. The Federal district court shall accept and approve the filing, including outside of normal business hours, and shall immediately issue the protective decree as to the covered broker or dealer.
(B) *Administration by SIPC* — Following entry of the protective decree, and except as otherwise provided in this section, the determination of claims and the liquidation of assets retained in the receivership of the covered broker or dealer and not transferred to the bridge financial company shall be administered under the Securities Investor Protection Act of 1970 ([15 U.S.C. 78aaa](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section78aaa&num=0&edition=prelim) et seq.) by SIPC, as trustee for the covered broker or dealer.
(C) *Definition of filing date* — For purposes o
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 5388
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Federal law — U.S. Code and appendices · legal_authorities
In taking action under this subchapter, the Corporation shall—
(1) determine that such action is necessary for purposes of the financial stability of the United States, and not for the purpose of preserving the covered financial company;
(2) ensure that the shareholders of a covered financial company do not receive payment until after all other claims and the Fund are fully paid;
(3) ensure that unsecured creditors bear losses in accordance with the priority of claim provisions in [section 5390 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section5390&num=0&edition=prelim);
(4) ensure that management responsible for the failed condition of the covered financial company is removed (if such management has not already been removed at the time at which the Corporation is appointed receiver);
(5) ensure that the members of the board of directors (or body performing similar functions) responsible for the failed condition of the covered financial company are removed, if such members have not already been removed at the time the Corporation is appointed as receiver; and
(6) not take an equity interest in or become a shareholder of any covered financial company or any covered subsidiary.
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 5389
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Federal law — U.S. Code and appendices · legal_authorities
**(a) to (c) Omitted**
**(d) FDIC Inspector General reviews**
(1) **Scope** — The Inspector General of the Corporation shall conduct, supervise, and coordinate audits and investigations of the liquidation of any covered financial company by the Corporation as receiver under this subchapter, including collecting and summarizing—
(A) a description of actions taken by the Corporation as receiver;
(B) a description of any material sales, transfers, mergers, obligations, purchases, and other material transactions entered into by the Corporation;
(C) an evaluation of the adequacy of the policies and procedures of the Corporation under [section 5383(d) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section5383/d&num=0&edition=prelim) and orderly liquidation plan under section 5390(n)(14) 11 See References in Text note below. of this title;
(D) an evaluation of the utilization by the Corporation of the private sector in carrying out its functions, including the adequacy of any conflict-of-interest reviews; and
(E) an evaluation of the overall performance of the Corporation in liquidating the covered financial company, including administrative costs, timeliness of liquidation process, and impact on the financial system.
(2) **Frequency** — Not later than 6 months after the date of appointment of the Corporation as receiver under this subchapter and every 6 months thereafter, the Inspector General of the Corporation shall conduct the audit and investigation described in paragraph (1).
(3) **Reports and testimony** — The Inspector General of the Corporation shall include in the semiannual reports required by [section 405(b) of title 5](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title5-section405/b&num=0&edit
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 5394
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Federal law — U.S. Code and appendices · legal_authorities
Page 1881
TITLE 12—BANKS AND BANKING
§ 5390
case commenced under the Bankruptcy Code),
and upon notice to SIPC (with respect to a cov-
ered broker or dealer) and no such case or pro-
ceeding may be commenced with respect to a
covered financial company at any time while
the orderly liquidation is pending.
(b) Revesting of assets
Effective as of the date of appointment of the
Corporation as receiver, the assets of a covered
financial company shall, to the extent they have
vested in any entity other than the covered fi-
nancial company as a result of any case or pro-
ceeding commenced with respect to the covered
financial company under the Bankruptcy Code,
the Securities Investor Protection Act of 1970 (15
U.S.C. 78aaa et seq.), or any similar provision of
State liquidation or insolvency law applicable to
the covered financial company, revest in the
covered financial company.
(c) Limitation
Notwithstanding subsections (a) and (b), any
order entered or other relief granted by a bank-
ruptcy court prior to the date of appointment of
the Corporation as receiver shall continue with
the same validity as if an orderly liquidation
had not been commenced.
(Pub. L. 111–203, title II, § 208, July 21, 2010, 124
Stat. 1459.)
Editorial Notes
REFERENCES IN TEXT
The Securities Investor Protection Act of 1970, re-
ferred to in subsecs. (a) and (b), is Pub. L. 91–598, Dec.
30, 1970, 84 Stat. 1636, which is classified generally to
chapter 2B–1 (§ 78aaa et seq.) of Title 15, Commerce and
Trade. For complete classification of this Act to the
Code, see section 78aaa of Title 15 and Tables.
Statutory Notes and Related Subsidiaries
EFFECTIVE DATE
Section effective 1 day after July 21, 2010, except as
otherwise provided, see section 4 of Pub. L. 111–203, set
out as
Source: Supplied 2024 U.S. Code historical extraction · 12 U.S.C. § 5390
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