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UNITED STATES OF AMERICA
BEFORE THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON, D.C.
)
In the Matter of
PATTI COLBOURN
A former Institution-Affiliated
Party of
Docket No. 97-022-B-I
1
j
Order to Cease and Desist
Issued Upon Consent
Pursuant to the Federal
Deposit Insurance Act,
As Amended
‘,
CHEMICAL BANK
New York, New York
1
)
WHEREAS, pursuant to sections 8(b) (1) and
8(i) (3) of the Federal Deposit Insurance Act, as amended
(the "FDI Act")
of Governors
Governors")
(12 U.S.C. §§ 1818(b) (1) and (i)(3)), the Board
of the Federal Reserve System
(the "Board of
issues this consent Order to Cease and Desist
(the "Order") against Patti Colbourn
("Colbourn'), a former
managing director, /trader and institution-affiliated
party, as
defined in sections 3(u) and 8(b) (3) of the FDI Act (12 U.S.C.
55 1813(u) and 1818(b) (3)), of the Chemical Bank, New York,
New York
("Chemical"), a state-chartered
business as Chase Manhattan Bank;that
bank, presently doing
is a member of the Federal
Reserve System, as a result of Colbourn's alleged participation
in unsafe and unsound practices in the course of her activities
as a trader of mortgage-backed
securities for Chemical: and
2
WHEREAS, by affixing her signature hereunder, Colbourn
has consented to the issuance of this Order by the Board of
Governors and has waived any and all rights she might otherwise
have pursuant to 12 U.S.C. § 1818, 12 C.F.R. Part 263, or
otherwise:
hearing;
(a) to the issuance of a notice of charges and of
(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,
terms, effectiveness
or enforceability of this Order or
any provision hereof.
NOW, THEREFORE, prior to the taking of any testimony or
adjudication
of or finding on any issue of fact or law implied or
set forth in this Order, and without this Order constituting an
admission of any allegation made or implied by the Board of
.
Governors in connection with this proceeding, and solely for the
purpose of settlement of this matter without protracted
or
extended hearings or testimony:
IT IS HEREBY ORDERED, pursuant to sections 8(b) and
(i)(3) of the FDI Act, that:
1.
Upon becoming an institution-affiliated
party of
any institution or agency specified in section 8(e)(7)(A) of the
FDI Act
(12 U.S.C. 5 1818(7)(e)(A)),
including, but not limited
3
to, any insured depository
company, or subsidiary
institution, bank or thrift holding
thereof, where her duties include,
directly or indirectly, the trading of securities, including, but
not limited to, the marketing,
selling, or purchasing of
government or corporate securities, including mortgage-backed
securities, Colbourn shall take such actions as are necessary and
consistent with her responsibilities
to ensure that she will
(a)
comply with all policies and procedures of her employer as they
pertain to such trading activities,
(b) engage only in trading
activities that are consistent with her fiduciary duties and with
safe and sound banking practices, and (c) comply fully with all
applicable laws and regulations pertinent to trading activities,
including any applicable
rules of a securities self-regulatory
organization.
2.
This Order, and each and every provision hereof, is
.
and shall remain fully effective and enforceable until expressly
stayed, modified,
terminated or suspended in writing by the Board
of Governors.
3.
All communications
regarding this Order shall be
addressed to:
(a)
Mr. Christopher J. McCurdy
Senior Vice President
Federal Reserve Bank of New York
33 Liberty Street
New York, New York 10045
4
(b)
4.
Ms. Patti Colbourn
c/o Lynn E. Judell, Esquire
Rosenthal Jude11 & Uchima
666 Third Avenue, 29th Floor
New York, New York 10017
The provisions of this Order shall not bar, estop,
or otherwise prevent the Board of Governors,
State agency or department
or any Federal or
from taking any other action affecting
Colbourn; provided, however, that the Board of Governors shall
not take any further action against Colbourn based upon
information presently known by the Board of Governors relating to
the matters addressed by this Order.
By order of the Board of Governors effective this
Board of Governors of the
Federal Reserve System
By:
William W. Wiles
Secretary of the Board