Sec. 258. Enforcement
588 words·~3 min read·
/bill/113/hr/2767/ih/section-258A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
The Director may take actions under subsection
(b)only if— the account for the Mutual Mortgage Insurance Fund established pursuant to section 256(a)(1) is classified under section 257(a) as significantly undercapitalized; the account for the Mutual Mortgage Insurance Fund established pursuant to section 256(a)(1) is classified under section 257(a) as undercapitalized and— the FHA does not submit a capital restoration plan that is substantially in compliance with section 257(c) within the applicable period, or the Director disapproves the capital restoration plan submitted by the FHA; or the FHA has failed to make, in good faith, reasonable efforts necessary to comply with the capital restoration plan; or the FHA is engaging or has engaged, or the Director has reasonable cause to believe that the FHA is about to engage in— any conduct that is likely to threaten the adequacy of the capital of the account for the Mutual Mortgage Insurance Fund established pursuant to section 256(a)(1); any failure to comply with any written agreement entered into by the FHA with the Director; or any failure to comply with any request by the Director for a report, data, or information under section 254(b). The Director may, under this subsection, require the FHA— to cease and desist from any conduct or activity that— with respect to the account for the Mutual Mortgage Insurance Fund established pursuant to section 256(a)(1), is described in paragraph
(2)or
(3)of subsection (a), or that contributes to the condition described in subsection (a)(1); and with respect to any other Fund, contributes to a failure to meet a capital reserve requirement established pursuant to section 259(a) or is likely to threaten the adequacy of the capital of such Fund; and to take corrective or remedial action, including— restricting the growth of, or contracting, any category of assets or liabilities; reducing, modifying, or terminating any activity that the Director determines creates excessive risk to the FHA; terminating agreements or contracts; engaging or employing qualified employees (who may be subject to approval by the Director at the direction of the Director); or submitting to the Director for review and approval a detailed and complete operating plan. If the Director is authorized under subsection
(a)of this section or section 259(b) to take action under subsection
(b)of this section and determines not to take any such action, the Director shall prepare a report detailing the basis of the Director’s decision not to take such action and shall, within 30 days of the decision, submit the report to the President, the Director of the Office of Management and Budget, the Comptroller General of the United States, the Committee on Banking and Financial Services of the House of Representatives, and the Committee on Banking, Housing, and Urban Affairs of the Senate. A capital restoration plan submitted pursuant to section 257(c), 259(b), or 260(d)(3) shall— set forth a feasible plan for raising or restoring the capital of the Fund for which it is prepared; specify the level of capital to be achieved and maintained; be submitted to the Director within 45 days from the date of notification, or if the Director determines that an extension is necessary, within such additional time as the Director so determines; describe the actions that the FHA shall take for such Fund to become classified as adequately capitalized; establish a schedule for completing the actions set forth in the plan; and specify the types and levels of activities (including existing and new business activities) in which the FHA shall engage during the term of the plan.