What is the Financial Institutions Reform, Recovery and Enforcement Act?

The Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) is a federal law passed in 1989 that was designed to address the savings and loan crisis of the 1980s. The law restores public confidence in the financial industry by ensuring that financial institutions are well-capitalized, transparent, and compliant with safety and soundness standards. In Kansas, the law applies to all financial institutions subject to state or federal regulations, including banks, savings associations, and credit unions. FIRREA also gives the Federal Deposit Insurance Corporation (FDIC) specific powers to close or take action against insolvent banks, and the ability to sue any financial institution for fraud or other violations of the law. It also sets limits on the fees financial institutions can charge for services, and makes it easier for states to enforce consumer protection laws. The Act also created the Office of Thrift Supervision, which is responsible for the regulation of Savings and Loan Associations, and the Office of the Comptroller of the Currency, which regulates the national banks. The law also established the Resolution Trust Corporation, which was responsible for resolving the insolvent savings and loan crisis. The purpose of FIRREA is to ensure that financial institutions comply with safety and soundness regulations and that consumers are protected from fraud or other abuses. By creating these regulations, the law has helped restore public confidence in the banking industry.

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What is the Financial Institutions Reform, Recovery and Enforcement Act?

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