Illinois § 6011 Effect of unauthorized investments

Illinois Statutes

§ 6011 — Effect of unauthorized investments

Illinois·Topic REGULATION·Ch. 205 FINANCIAL REGULATION·Act 205 ILCS 205/ Savings Bank Act.·Art. Article 6 - Investments

(a)Every loan or other investment made in violation of this Act shall be due and payable according to its terms, and the obligation thereof shall not be impaired.

(b)Every director or officer of a savings bank who shall knowingly participate in or assent to, or who shall knowingly permit any of the officers or agents of the savings bank to make, investments not authorized by this Act shall be liable individually for all damage that the savings bank may sustain in consequence of the investments, in addition to any criminal penalties prescribed by this Act.

(c)The Commissioner may require every director or officer of a savings bank who shall knowingly participate in or assent to, or who shall knowingly permit any of the officers or agents of the savings bank to make, investments not autho

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(a) Every loan or other investment made in violation of this Act shall be due and payable according to its terms, and the obligation thereof shall not be impaired. (b) Every director or officer of a savings bank who shall knowingly participate in or assent to, or who shall knowingly permit any of the officers or agents of the savings bank to make, investments not authorized by this Act shall be liable individually for all damage that the savings bank may sustain in consequence of the investments, in addition to any criminal penalties prescribed by this Act. (c) The Commissioner may require every director or officer of a savings bank who shall knowingly participate in or assent to, or who shall knowingly permit any of the officers or agents of the savings bank to make, investments not authorized by this Act to deposit with the savings bank an indemnity bond, insurance, or collateral of a kind and amount sufficient to indemnify the savings bank against damages that the savings bank may sustain in consequence of the investments. The amount considered sufficient to indemnify the savings bank shall, in the case of an unauthorized investment, be the difference between the book value and the market value of the investment at the time the Commissioner makes his determination that the investment is unauthorized. The amount considered sufficient to indemnify the savings bank, in the case of an unauthorized loan, shall be the difference between the book value of the loan and the amount that could have been made under the provisions of this Act. Whenever an unauthorized investment has been sold or disposed of without recourse, the Commissioner shall release all or part of the indemnity after deducting any loss. Whenever the balance of an unauthorized loan has been reduced to an amount that would permit the loan to be made under the provisions of this Act, the indemnity shall be released, provided that the Commissioner in making the determination may require an independent appraisal of the security.

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