Financial Institution Regulations

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What regulations must financial institutions abide by?

Financial Institution Regulations

Financial institutions are bound by certain federal regulations. The regulations are found in Title 12 of the Code of Federal Regulations. There are several regulations that financial institutions must follow, including credit issues, disclosure issues, reserve requirements, regulations for electronic transfers, and the issuance and cancellation of federal reserve bank stock, to name a few.

If a financial institution does not abide by the financial institution regulations contained in the Code of Federal Regulations, and any other state regulations that may be in place, the injured party may sue the financial institution. If it is found that the financial institution's breach of the regulations injured many people, a class action lawsuit may be instituted against the financial institution.

Lawsuits against financial institutions because of a breach of regulations often result in copious documents, whether paper or electronic, being exchanged in the discovery process. Documents must be reviewed for attorney-client privilege or other confidentiality issues prior to being sent to opposing counsel. Once documents are received by counsel, the documents must also be reviewed for content. Retaining an experienced temporary attorney to review documents (incoming and outgoing) during the discovery process is more cost effective to the firm than having one of the firm's attorneys review the documents.



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