Tex. Fin. Code Section 35.003
Removal or Prohibition Order


(a)

The banking commissioner has grounds to remove or prohibit a present or former officer, director, or employee of a state bank from office or employment in, or prohibit a controlling shareholder or other person participating in the affairs of a state bank from further participation in the affairs of, a state bank or any other entity chartered, registered, permitted, or licensed by the banking commissioner if the banking commissioner determines from examination or other credible evidence that:

(1)

the person:

(A)

intentionally committed or participated in the commission of an act described by Section 35.002 (Cease and Desist Order)(a) with regard to the affairs of a financial institution, as defined by Section 201.101 (Definitions);

(B)

violated a final cease and desist order issued by a state or federal regulatory agency against the person or an entity in which the person is or was an officer, director, or employee; or

(C)

made, or caused to be made, false entries in the records of a financial institution;

(2)

because of this action by the person:

(A)

the financial institution has suffered or will probably suffer financial loss or expense, or other damage;

(B)

the interests of the depositors, creditors, or shareholders of the financial institution have been or could be prejudiced; or

(C)

the person has received financial gain or other benefit by reason of the action, or likely would have if the action had not been discovered; and

(3)

the action:

(A)

involves personal dishonesty on the part of the person; or

(B)

demonstrates wilful or continuing disregard for the safety or soundness of the financial institution.

(b)

If the banking commissioner has grounds for action under Subsection (a) and finds that a removal or prohibition order appears to be necessary and in the best interest of the public, the banking commissioner may serve a proposed removal or prohibition order, as appropriate, on a person alleged to have committed or participated in the action. The proposed order must:

(1)

be delivered by personal delivery or by registered or certified mail, return receipt requested;

(2)

state with reasonable certainty the grounds for removal or prohibition;

(3)

state the effective date of the order, which may not be before the 21st day after the date the proposed order is delivered or mailed; and

(4)

state the duration of the order, including whether the duration of the order is perpetual.

(b-1)

The banking commissioner may make a removal or prohibition order perpetual or effective for a specific period of time, may probate the order, or may impose other conditions on the order.

(c)

The order takes effect if the person against whom the proposed order is directed does not request a hearing in writing before the effective date. After taking effect, the order is final and nonappealable as to that person.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997. Amended by Acts 1999, 76th Leg., ch. 344, Sec. 2.013, eff. Sept. 1, 1999.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 42, eff. September 1, 2007.
Acts 2011, 82nd Leg., R.S., Ch. 183 (S.B. 1165), Sec. 1, eff. May 28, 2011.
Acts 2013, 83rd Leg., R.S., Ch. 940 (H.B. 1664), Sec. 9, eff. June 14, 2013.

Source: Section 35.003 — Removal or Prohibition Order, https://statutes.­capitol.­texas.­gov/Docs/FI/htm/FI.­35.­htm#35.­003 (accessed Jun. 5, 2024).

35.0001
Applicability to Bank Subsidiaries
35.001
Determination Letter
35.002
Cease and Desist Order
35.003
Removal or Prohibition Order
35.004
Hearing on Proposed Order
35.005
Emergency Order
35.006
Copy of Letter or Order in Bank Records
35.007
Effect of Final Removal or Prohibition Order
35.008
Limitation on Action
35.009
Enforcement by Commissioner
35.010
Administrative Penalty
35.011
Payment or Appeal of Administrative Penalty
35.012
Confidentiality of Records
35.013
Collection of Fees
35.0035
Removal or Prohibition Orders in Response to Certain Criminal Offenses
35.0071
Application for Release from Final Removal or Prohibition Order
35.101
Order of Supervision
35.102
Order of Conservatorship
35.103
Notice and Hearing
35.104
Post-hearing Order
35.105
Confidentiality of Records
35.106
Authority of Supervisor
35.107
Authority of Conservator
35.108
Qualifications of Appointee
35.109
Expenses
35.110
Review of Supervisor or Conservator Decision
35.111
Venue
35.112
Duration
35.113
Administrative Election of Remedies
35.114
Release Before Hearing
35.201
Inapplicability
35.202
Investigation of Unauthorized Activity
35.203
Subpoena Authority
35.204
Enforcement of Subpoena
35.205
Confidentiality of Subpoenaed Records
35.206
Evidence
35.207
Cease and Desist Order
35.208
Emergency Cease and Desist Order
35.209
Judicial Review of Cease and Desist Order
35.210
Violation of Final Cease and Desist Order
35.211
Administrative Penalty
35.212
Payment and Appeal of Administrative Penalty
35.213
Judicial Review of Administrative Penalty
35.1001
Applicability to Bank Subsidiaries

Accessed:
Jun. 5, 2024

§ 35.003’s source at texas​.gov