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For immediate release
March I,
1997
The Federal Reserve Board today announced the issuance
of a combined Order to Cease and Desist, Order of Restitution and
Order of Assessment of a Civil Money Penalty against
John Gillogly, a former officer and institution-affiliated
party
of The Bank of Corning, Corning, Ohio.
Mr. Gillogly, without admitting to any allegations,
consented to the issuance of the Order due to his alleged
participation
in unsafe and unsound practices, breaches of
fiduciary duty, and violations of the Board of Governors's
Regulation 0 relating to the management and disposition of a
parcel of property previously owned by the bank.
Mr. Gillogly paid a fine of $2,000 in addition to his
restitution to the bank in the amount of $4,965.
A copy of the Order is attached.
Attachment
UNITED STATES OF AMERICA
BEFORE TRE
BOARD OF GOVERNORS
OF
TRE FEDERAL RESERVE SYSTEM
W4SEINGTON. D.C.
STATE
OF
OR10
BEFORE TEE SUPERINTENDENT OF FINANCIAL INSTITUTIONS
COLDEBRS, OHIO
In the Matter of
95-021-B-I
95-021-CMP-I
Order to Cease and Desist,
Order of Restitution and Order
of Assesement of a Civil Money
Penalty Issued Upon Consent
Pursuant to the Federal
Deposit Insurance Act, as
Amended, the Federal
Reserve Act, as Amended and
Section 1125.08 of the Ohio
Revised Code
Docket No.
JOHN GILLOGLY
I
A Former Officer and
Institution-Affiliated
Party of
;
THE BANK OF COREING
Corning, Ohio
WHEREAS, pursuant to sections 8(b) and 8(i) (2) of the
Federal Deposit Insurance Act, as amended (the "FDI Act")
(12 U.S.C. 1818(b) and (il (2)), section 29(a) of the Federal
Reserve Act, as amended
(the "FR Act") (12 U.S.C. 504(a)), and
section 215.13 of Regulation 0 of the Board of Governors of the
Federal Reserve System
(the "Board of Governorsn), 12 C.F.R.
section 215.13, the Board
of
Governors and, pursuant to section
1125.08 of the Ohio Revised Code ("ORC"), the Superintendent of
the Ohio Division of Financial Institutions (the
"Superintendent"), issue this combined Order to Cease and Desist,
Order of Reetitution and Order of Assessment of a Civil Money
Penalty
(the aOrder*) against John Gillogly ("Gilloglyn), a
2
former officer and institution-affiliated party, as defined in
section 3(u) of the FDI Act
(12 U.S.C. 1813(u)), of The Bank of
Corning, Corning, Ohio (the "Bank"), a state member bank, in
connection with Gillogly's participation in alleged unsafe and
unsound practices, breaches of fiduciary duty, and violations of
the Board of Governors's Regulation 0 relating to the management
and disposition of a parcel of property previously owned by the
Bank; and
WHEREAS, by affixing his signature hereunder, Gillogly
has consented to the issuance of this Order by the Board of
Governors and has:
(1) consented to comply with each and every
provision of this Order; and (2) waived any and all rights he
might have pureuant to 12 U.S.C. 1818, 12 U.S.C. 504, 12 C.F.R.
Part 263, 12 C;F.R.
Part 215, ORC section 1125.08, or otherwise,
(a) to the issuance of a~notice of charges and notice of
assessment of a civil money penalty; (b) to a hearing for the
purpose of taking evidence with respect to any matter implied or
set forth in this Order; (c) to obtain judicial review of this
Order or any provision hereof; and (d) to challenge or contest in
any manner the basis, issuance, validity, effectivenees,
collectibility or enforceability of this Order or any provieion
hereof.
NOW, TRERRFGRR, prior to the taking of any testimony or
adjudication of or finding on any ieaue of fact or law herein,
3
and without this Order constituting an admission of any
allegation made or implied by the Board of Governors or the
Superintendenr
in connection with this proceeding, and solely for
the purpose of setclement of this proceeding without protracted
or excencied hearings or testimony:
IT IS HEREBY ORDERED, pursuant to sections 8(b) (11,
8(b) (6) and 8(i) (2) of the FDI Act, section 29 of the FR Act and
ORC section 1125.08, that:
1.
Gillogly shall cease and desist from any acts,
omissions, or practices involving unsafe and unsound practices,
breaches of fiduciary duty or violations of law in connection
with the conduct of the business of any insured depository
institution.
2.
In the event that Gillogly becomes an institution-
affiliated party of any institution described in paragraph 1
hereof, Gillogly shall:
(a) Take such actions as are necessary,
consistent with his responsibilities, to obtain
advice of competent counsel on his duties and
responsibilities, both initially upon accepting
such a position and on a continuing basis when
4
particular issues arise that may cause Gillogly
to
be uncertain about his responsibilities;
(b)
with respect to any proposal in which he has
or reasonably expects to have a personal interest
or experience a direct or indirect benefit,
abstain from voting as a director or participating
in any manner in the presentation or discussion
of
any such proposals to or with the board of
directors;
(c)
in connection with any proposal subject to
paragraph 2(b) hereof, make full and complete
disclosure to the board of dinctors
of the
existence of his interest and its nature and
extent, and of the facts known to him relating to
the proposal under consideration;
(d)
at least annually, and promptly in the event
of a change in circumstances, make full disclosure
of any and all loans, investments, partnership
interests, stock ownership, or any other business
relationships with the institution described
paragraph 1 hereof, its subsidiaries
in
or
affiliates, or its customers, which constitute
5
actual or potential conflicts of interest between
Gillogly and the institution; and
(e)
refrain from violating the standards
established by any applicable federal or state
statute, regulation, policy statement, guideline,
or similar pronouncement by any appropriate
federal or state banking regulator, governing
conflicts of interest, the fiduciary duties of
director8 and officers, and the cafe or eound
operation of depository institutions and take such
action8 a8 are necessary and coneietent with hi8
reeponsibilitiee
to ensure that all operation8
within hi8 area of re8pon8ibility are conducted in
a cafe and 8OUnd manner and subject to appropriate
supervision by the board of director8 of the
in+titution or a committee thereof.
3.
Gillogly 8hall pay, in the manner 8et forth in
paragraph 5 hereof, restitution to the Bank in the 8um of
$4.965.00,
representing rental payment8 received and accepted by
Gillogly on real eetate owned by the Bank for the period of
February 1, 1993 through May 21, 1993.
6
4.
Gillogly is assessed and shall forfeit and pay in
the manner set forth in paragraph 5 hereof, a civil money penalty
in the sum of $2.000.00.
5.
The restitution and civil money penalty assessed by
this Order pursuant to paragraphs 3 and 4 hereof shall be
remitted in full, at the time of Gillogly's execution of this
Order, payable to the "Board of Governors of the Federal Reserve
System" and forwarded, with Gillogly's executed copy of this
Order, to William W. Wiles, Secretary of the Board, Board of
Governors of the Federal Reserve System, Washington, D.C. 20551,
who shall, as applicable, make remittance to the Bank and the
Treasury of the United States.
6.
sent
All communications regarding this Order shall be
to:
(ai,
Mr. Stephen H. Jenkins
Regional Director
Federal Reserve Bank of Cleveland
1455 East Sixth Street
Cleveland, Ohio 44114
(b)
Mr. W. Curtis Stitt
Superintendent
Ohio Division of Financial Institutions
77 South High Street, 2lst Floor
Columbus, Ohio 43266-0121
(cl
Mr. John Gillogly
11995 Zion Branch
Thornville, Ohio 43076
7
7.
Each provision of this Order shall remain effective
and enforceable until stayed, modified, terminated or suspended
by the Board of Governors and the Superintendent.
2.
The provisions of t;-.is
Order shall not bar, estop
or otherwise prevent the Board of Governors, the Superintendent,
the Reserve Bank or any federal, state or local agency or
department from taking any action affecting Gillogly; however,
the Board of Governors, the Superintendent and the Reserve Bank
shall not take any further action with respect to the matters
that are the subject of this Order.
By order of the Board of Governors
of
the Federal Reserve
System and the Superintendent of the Ohio Division of Financial
Institutions, effective this Teay
of Darth 1'997.
BOARD OF GOVERNORS OF THE
FEDEm
RESERVE SYSTEM
By:&L22xL!z
William W. Wilee
Secretary
of the Board
OHIO DIVISION
OF
FINANCIAL
-;a
intendantof
Institutions