---
kind: "section"
citation: "12 U.S.C. § 2264"
title: "12"
title_heading: "Banks and Banking"
number: "2264"
heading: "Suspension or removal of director or officer"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/12/2264"
units:
  - "Chapter 23 — Farm Credit System"
  - "Subchapter V — Farm Credit Administration Organization"
  - "Part C — Enforcement Powers of Farm Credit Administration"
---

# §2264. Suspension or removal of director or officer

- (a) **Written notice of intention to remove; violation of law, rule, regulation, or final cease and desist order; unsafe or unsound practice; breach of fiduciary duty—** Whenever, in the opinion of the Farm [Credit](/usc/12/5481.md?p=7) Administration, any [director](/usc/12/2279bb.md?p=3) or officer of any [institution](/usc/12/2271.md?p=3) in the Farm [Credit](/usc/12/5481.md?p=7) System has committed any [violation](/usc/12/2271.md?p=2) of law, rule, or regulation or of a [cease and desist order that has become final](/usc/12/2271.md?p=1), or has engaged or participated in any [unsafe or unsound practice](/usc/12/2271.md?p=5) in connection with the [institution](/usc/12/2271.md?p=3), or has committed or engaged in any act, omission, or practice which constitutes a breach of a fiduciary duty as such [director](/usc/12/2279bb.md?p=3) or officer, and the Farm [Credit](/usc/12/5481.md?p=7) Administration determines that the [institution](/usc/12/2271.md?p=3) has suffered or will probably suffer substantial financial loss or other damage or that the interests of its shareholders or investors in Farm [Credit](/usc/12/5481.md?p=7) System obligations could be seriously prejudiced by reason of such [violation](/usc/12/2271.md?p=2) or practice or breach of fiduciary duty, or that the [director](/usc/12/2279bb.md?p=3) or officer has received financial gain by reason of such [violation](/usc/12/2271.md?p=2) or practice or breach of fiduciary duty, and that such [violation](/usc/12/2271.md?p=2) or practice or breach of fiduciary duty is one involving personal dishonesty on the part of such [director](/usc/12/2279bb.md?p=3) or officer, or one that demonstrates a willful or continuing disregard for the safety or soundness of the [System institution](/usc/12/2271.md?p=3), the Farm [Credit](/usc/12/5481.md?p=7) Administration may serve upon such [director](/usc/12/2279bb.md?p=3) or officer a written notice of its intention to remove him from [office](/usc/12/2279bb.md?p=4).
- (b) **Written notice of intention to remove or suspend director, officer or other person; personal dishonesty; willful or continuing disregard; unfitness to continue in office or to participate in affairs of institution—** Whenever, in the opinion of the Farm [Credit](/usc/12/5481.md?p=7) Administration, any [director](/usc/12/2279bb.md?p=3) or officer of an [institution](/usc/12/2271.md?p=3) in the Farm [Credit](/usc/12/5481.md?p=7) System, by conduct or practice with respect to another [institution](/usc/12/2271.md?p=3) in the Farm [Credit](/usc/12/5481.md?p=7) System or other business [institution](/usc/12/2271.md?p=3) that resulted in substantial financial loss or other damage, has evidenced either his personal dishonesty or a willful or continuing disregard for its safety and soundness and, in addition, has evidenced his unfitness to continue as a [director](/usc/12/2279bb.md?p=3) or officer, and whenever, in the opinion of the Farm [Credit](/usc/12/5481.md?p=7) Administration, any other [person](/usc/12/5481.md?p=19) participating in the conduct of the affairs of an [institution](/usc/12/2271.md?p=3) in the Farm [Credit](/usc/12/5481.md?p=7) System, by the conduct or practice with respect to such [institution](/usc/12/2271.md?p=3) or other [institution](/usc/12/2271.md?p=3) in the Farm [Credit](/usc/12/5481.md?p=7) System or other business [institution](/usc/12/2271.md?p=3) that resulted in substantial financial loss or other damage, has evidenced either personal dishonesty or a willful or continuing disregard for its safety and soundness and, in addition, has evidenced his unfitness to participate in the conduct of the affairs of such [institution](/usc/12/2271.md?p=3), the Farm [Credit](/usc/12/5481.md?p=7) Administration may serve upon such [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) a written notice of its intention to remove that [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) from [office](/usc/12/2279bb.md?p=4) or to prohibit his further participation in any manner in the conduct of the affairs of the [institution](/usc/12/2271.md?p=3).
- (c) **Suspension from office; prohibition from further participation in conduct of affairs of institution; service of notice—** In respect to any [director](/usc/12/2279bb.md?p=3) or officer of an [institution](/usc/12/2271.md?p=3) in the Farm [Credit](/usc/12/5481.md?p=7) System or any other [person](/usc/12/5481.md?p=19) referred to in subsection [(a)](#a) or [(b)](#b) of this section, the Farm [Credit](/usc/12/5481.md?p=7) Administration may, if it deems it necessary for the protection of the [institution](/usc/12/2271.md?p=3) or the interests of its shareholders and the investors in the Farm [Credit](/usc/12/5481.md?p=7) System obligations, by written notice to such effect served upon such [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19), suspend such [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) from [office](/usc/12/2279bb.md?p=4) or prohibit such [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) from further participation in any manner in the conduct of the affairs of the [institution](/usc/12/2271.md?p=3). Such suspension or prohibition shall become effective upon service of such notice and, unless stayed by a court in proceedings authorized by [subsection (e)](#e) of this section, shall remain in effect pending the completion of the administrative proceedings pursuant to the notice served under subsection [(a)](#a) or [(b)](#b) and until such time as the Farm [Credit](/usc/12/5481.md?p=7) Administration shall dismiss the charges specified in such notice, or, if an order of removal or prohibition is issued against the [director](/usc/12/2279bb.md?p=3) or officer or other [person](/usc/12/5481.md?p=19), until the effective date of any such order. Copies of any such notice shall also be served upon the [institution](/usc/12/2271.md?p=3) of which the [person](/usc/12/5481.md?p=19) is a [director](/usc/12/2279bb.md?p=3) or officer or in the conduct of whose affairs the [person](/usc/12/5481.md?p=19) has participated.
- (d) **Statement of grounds for removal or prohibition; notice and hearing; order of suspension, removal or prohibition; service of order—** A notice of intention to remove a [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) from [office](/usc/12/2279bb.md?p=4) or to prohibit such [director](/usc/12/2279bb.md?p=3)’s, officer’s, or other [person](/usc/12/5481.md?p=19)’s participation in the conduct of the affairs of an [institution](/usc/12/2271.md?p=3) in the Farm [Credit](/usc/12/5481.md?p=7) System, shall contain a statement of the facts constituting grounds therefor, and shall fix a time and place at which a hearing will be held thereon. Such hearing shall be fixed for a date not earlier than thirty days nor later than sixty days after the date of service of such notice, unless an earlier or a later date is set by the Farm [Credit](/usc/12/5481.md?p=7) Administration at the request of (1) such [director](/usc/12/2279bb.md?p=3) or officer or other [person](/usc/12/5481.md?p=19), and for good cause shown, or (2) the Attorney General of the United States. Unless such [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) shall appear at the hearing in [person](/usc/12/5481.md?p=19) or by a duly authorized representative, such [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) shall be deemed to have consented to the issuance of an order of such removal or prohibition. In the event of such consent, or if upon the record made at any such hearing the Farm [Credit](/usc/12/5481.md?p=7) Administration shall find that any of the grounds specified in such notice have been established, the Farm [Credit](/usc/12/5481.md?p=7) Administration may issue such orders of suspension or removal from [office](/usc/12/2279bb.md?p=4), or prohibition from participation in the conduct of the affairs of the [institution](/usc/12/2271.md?p=3), as it may deem appropriate. A copy of an order issued under this subsection shall be served upon the [institution](/usc/12/2271.md?p=3) concerned. Any such order shall become effective at the expiration of thirty days after service upon such [institution](/usc/12/2271.md?p=3) and the [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) concerned (except in the case of an order issued upon consent, which shall become effective at the time specified therein). Such order shall remain effective and enforceable except to such extent as it is stayed, modified, terminated, or set aside by action of the agency or a reviewing court.
- (e) **Stay of suspension or prohibition—** Within ten days after any [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) has been suspended from [office](/usc/12/2279bb.md?p=4) or prohibited from participation in the conduct of the affairs of a [System institution](/usc/12/2271.md?p=3) under [subsection (c)](#c) of this section, such [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) may apply to the United States district court for the judicial district in which the home [office](/usc/12/2279bb.md?p=4) of the [institution](/usc/12/2271.md?p=3) is located, or the United States district court for the District of Columbia, for a stay of either such suspension or prohibition, or both, pending the completion of the administrative proceedings pursuant to the notice served upon such [director](/usc/12/2279bb.md?p=3), officer, or other [person](/usc/12/5481.md?p=19) under subsection [(a)](#a) or [(b)](#b), and such court shall have jurisdiction to stay either such suspension or prohibition, or both.

## Source credit

(Pub. L. 92–181, title V, § 5.28, as added Pub. L. 99–205, title II, § 204, Dec. 23, 1985, 99 Stat. 1696; amended Pub. L. 100–233, title VIII, § 805(aa), Jan. 6, 1988, 101 Stat. 1717; Pub. L. 100–399, title VII, § 702(d), Aug. 17, 1988, 102 Stat. 1006.)

## Notes

### Editorial Notes

### Prior Provisions

A prior section 5.28 of Pub. L. 92–181 was renumbered section 5.42 and is set out as a note under section 2001 of this title.

### Amendments

1988—Subsec. (a). Pub. L. 100–233, § 805(aa)(1), designated provisions preceding subsec. (b) as subsec. (a).

Subsec. (e). Pub. L. 100–399 substituted “subsection (c)” for “subsection (d)”.

Pub. L. 100–233, § 805(aa)(2), substituted “subsection (d) of this section” for “subsection (d)(3) of this section”.

### Statutory Notes and Related Subsidiaries

### Effective Date of 1988 Amendment

Amendment by Pub. L. 100–399 effective as if enacted immediately after enactment of Pub. L. 100–233, which was approved Jan. 6, 1988, see section 1001(a) of Pub. L. 100–399, set out as a note under section 2002 of this title.

### Effective Date

Section effective thirty days after Dec. 23, 1985, see section 401 of Pub. L. 99–205, set out as an Effective Date of 1985 Amendment note under section 2001 of this title.