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Can you summarize RIGL Title 19, Chapter 13?
Financial institutions > Banking Emergencies
Short Summary
This provision, found in the State of Rhode Island General Laws under the section on Banking Emergencies, governs the treatment of cash deposits received by regulated institutions after an order has been issued by the director to suspend or restrict currency withdrawals. Under this provision, these cash deposits, referred to as ’new cash deposits’, are not subject to any limitations or restrictions imposed by the order. Instead, they must be segregated and held or invested solely to meet the liability associated with these new cash deposits. The aggregate amount of cash representing these deposits must be kept separately in cash, deposited in Federal Reserve banks, or invested in obligations of the United States, as authorized by the Secretary of the Treasury or other federal authorities. New deposits, other than new cash deposits, need not be segregated, but may be drawn against by check to the same extent and in the same manner as deposits existing prior to any order of the director, issued under the provisions of this chapter, and may also be drawn against under the terms of the order; provided, nevertheless, that new deposits made in any medium of exchange prescribed by the director under the provisions of this chapter shall be payable in the deposited medium of exchange, or the medium of exchange into which it may have been converted, and any such deposits may be withdrawn in whole or in part. The provision also grants the director the authority to order regulated institutions to suspend or restrict the payment of their liabilities to shareholders, depositors, and other creditors during a banking emergency. The purpose of this order is to protect the public and the interests of depositors and creditors. The order becomes effective upon receipt by the regulated institutions and remains in force until revoked or modified by the director. The director may allow the payment of suspended or restricted liabilities under certain conditions and terms prescribed by the director. Acceptance of such payments, if not offered in legal tender, is optional for the entitled person. The governor may proclaim that a banking emergency exists when it appears necessary to protect the public and the interests of those regulated institutions or of the shareholders, depositors, or other creditors of those regulated institutions. Thereupon, any or all of the regulated institutions shall be subject to special regulation by the director, until the governor, by like proclamation, declares the period of banking emergency terminated. Any action taken or order issued by the director in any of the following sections in this chapter shall, in each instance, be taken only with the approval of the governor.
Whom does it apply to?
Regulated institutions
What does it govern?
Treatment of cash deposits received by regulated institutions after an order has been issued by the director to suspend or restrict currency withdrawals
What are exemptions?
New deposits, other than new cash deposits, need not be segregated
What are the Penalties?
Any person or regulated institution violating any order or any provision of any rule or regulation made by the director under the authority of this chapter, shall be punished by fine of not more than one thousand dollars ($1,000), or by imprisonment for not more than one year, or both.
Jurisdiction
Rhode Island