12 U.S.C. § 501 — Liability of Federal reserve or member

Page 176 TITLE 12—BANKS AND BANKING § 501 Executive Documents EXCEPTION AS TO TRANSFER OF FUNCTIONS Functions vested by any provision of law in Comp- troller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under section 1 of this title. SUBCHAPTER XVI—CIVIL LIABILITY OF FEDERAL RESERVE AND MEMBER BANKS, SHAREHOLDERS, AND OFFICERS § 501. Liability of Federal reserve or member bank for certifying check when amount of deposit was inadequate It shall be unlawful for any officer, director, agent, or employee of any Federal reserve bank, or any member bank as defined in this chapter, to certify any check drawn upon such Federal reserve bank or member bank unless the person, firm, or corporation drawing the check has on deposit with such Federal reserve bank or mem- ber bank, at the time such check is certified, an amount of money not less than the amount spec- ified in such check. Any check so certified by a duly authorized officer, director, agent, or em- ployee shall be a good and valid obligation against such Federal reserve bank or member bank; but the act of any officer, director, agent, or employee of any such Federal reserve bank or member bank in violation of this section shall, in the discretion of the Board of Governors of the Federal Reserve System, subject such Fed- eral reserve bank to the penalties imposed by subsection (h) of section 248 of this title, and shall subject such member banks, if a national bank, to the liability and proceedings on the part of the Comptroller of the Currency provided for in section 192 of this title, and shall, in the discretion of the Board of Governors of the Fed- eral Reserve System, subject any other member bank to the penalties imposed by subchapter VIII of chapter 3 of this title for the violation of any of the provisions of this chapter. (R.S. § 5208; Sept. 26, 1918, ch. 177, § 7, 40 Stat. 972; Feb. 25, 1927, ch. 191, § 12, 44 Stat. 1231; Aug. 23, 1935, ch. 614, title II, § 203(a), 49 Stat. 704.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in text, was in the original ‘‘the act of December 23, 1913, known as the Federal Re- serve Act,’’ and ‘‘said act,’’ respectively, meaning act Dec. 23, 1913, ch. 6, 38 Stat. 251. For complete classifica- tion of this Act to the Code, see References in Text note set out under section 226 of this title and Tables. Subchapter VIII of chapter 3 of this title, referred to in text, was in the original ‘‘section nine of said Fed- eral reserve Act’’. Section 9 is classified generally to subchapter VIII (§ 321 et seq.) of chapter 3 of this title. CODIFICATION R.S. § 5208 derived from act Mar. 3, 1869, ch. 135, 15 Stat. 335. The last sentence of R.S. § 5208, as amended, which provided penalties for certification of certain checks, was repealed by section 21 of act June 25, 1948, ch. 645, 62 Stat. 862, 865, and the provisions thereof were reen- acted as section 1004 of Title 18, Crimes and Criminal Procedure. AMENDMENTS 1927—Act Feb. 25, 1927, substituted ‘‘deposited in the bank of the drawer thereof’’ after ‘‘regularly’’ in last sentence. Statutory Notes and Related Subsidiaries CHANGE OF NAME Section 203(a) of act Aug. 23, 1935, changed name of Federal Reserve Board to Board of Governors of the Federal Reserve System. Executive Documents EXCEPTION AS TO TRANSFER OF FUNCTIONS Functions vested by any provision of law in Comp- troller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under section 1 of this title. § 501a. Forfeiture of franchise of national banks for failure to comply with provisions of this chapter Should any national banking association in the United States now organized fail within one year after December 23, 1913, to become a mem- ber bank or fail to comply with any of the provi- sions of this chapter applicable thereto, all of the rights, privileges, and franchises of such as- sociation granted to it under the national-bank Act [12 U.S.C. 21 et seq.], or under the provisions of this chapter, shall be thereby forfeited. Any noncompliance with or violation of this chapter shall, however, be determined and adjudged by any court of the United States of competent ju- risdiction in a suit brought for that purpose in the district or territory in which such bank is located, under direction of the Board of Gov- ernors of the Federal Reserve System, by the Comptroller of the Currency in his own name be- fore the association shall be declared dissolved. In cases of such noncompliance or violation, other than the failure to become a member bank under the provisions of this chapter, every direc- tor who participated in or assented to the same shall be held liable in his personal or individual capacity for all damages which said bank, its shareholders, or any other person shall have sus- tained in consequence of such violation. Such dissolution shall not take away or im- pair any remedy against such corporation, its stockholders, or officers, for any liability or penalty which shall have been previously in- curred. (Dec. 23, 1913, ch. 6, § 2 (pars.), 38 Stat. 252; Aug. 23, 1935, ch. 614, title II, § 203(a), 49 Stat. 704.) Editorial Notes REFERENCES IN TEXT This chapter, referred to in text, was in the original ‘‘this Act’’, meaning act Dec. 23, 1913, ch. 6, 38 Stat. 251, known as the Federal Reserve Act. For complete classi- fication of this Act to the Code, see References in Text note set out under section 226 of this title and Tables. The national-bank Act, referred to in text, is act June 3, 1864, ch. 106, 13 Stat. 99, which is classified prin- cipally to chapter 2 (§ 21 et seq.) of this title. For com- plete classification of this Act to the Code, see Ref- erences in Text note set out under section 38 of this title. CODIFICATION Section is comprised of the sixth and seventh pars. of section 2 of act Dec. 23, 1913. For classification of other pars. of section 2 of this Act, see Codification note set out under section 222 of this title.