Pub. 13 2018-2019 Issue 2

WWW.NEBANKERS.ORG 12 COUNSELOR’S CORNER Challenging the Enforceability of Regulatory Enforcement Actions: LabMD vs the FTC Bryan Handlos , Kutak Rock LLP There is no such thing as absolute certainty, but there is assurance sufficient for the purposes of human life. - John Stuart Mill, On Liberty Y OUR EXAMINERS HAVE IDENTIFIED A VIOLATIONOF LAWWHICH they consider serious enough to warrant enforcement action. Months of pain will follow. Restitution and civil money penalties may be required, the bank’s reputation may suffer, and the bank will of course be required to cease its violation. Affirmative remedial steps may well be required to assure that the violation is not repeated. New poli- cies and procedures may need to be adopted and followed. The burden associated with these remedial steps may be significant. Heightened attention by regulators, new reporting obligations and board of director’s involvement will provide powerful incentives to scrupulously comply with the regulators’ affir- mative remedial requirements. Scrupulous compliance may be challenging if the required remedial steps lack specificity. A recent decision from the United States Court of Appeals for the Eleventh Circuit could help. In June of 2018, the United States Court of Appeals for the Eleventh Circuit decided that a regulatory cease and desist order was unenforceable based on its lack of specificity. In LabMD,