Washington Administrative Code Title 208 - Financial Institutions, Department of (See also Titles 50, 419, and 460)
Washington Administrative Code Title 208 – Department of Financial Institutions (DFI)
Overview
Title 208 of the Washington Administrative Code governs the Department of Financial Institutions (DFI), which is the state agency responsible for regulating and supervising financial institutions operating within Washington State. These institutions include banks, credit unions, trust companies, mortgage lenders, and other financial service providers.
The rules under Title 208 provide the framework for licensing, examination, enforcement, consumer protection, and compliance to ensure a safe and sound financial environment for Washington residents.
The mention of Titles 50, 419, and 460 relates to related codes governing insurance, banking, and securities, which often intersect with DFI’s regulatory scope.
Purpose of the Department of Financial Institutions
To regulate and supervise financial institutions to ensure their safety, soundness, and compliance with applicable laws.
To protect consumers and the public interest by promoting ethical and legal business practices.
To license and oversee various financial service providers, including mortgage brokers, lenders, and escrow agents.
To enforce laws against fraud, unfair practices, and unsafe financial operations.
Key Components of Title 208 WAC
1. Organization and Authority
The DFI operates under the authority granted by the Washington State Legislature.
It is headed by a Commissioner of Financial Institutions appointed by the Governor.
The Department has divisions specializing in banks, credit unions, non-depository institutions, and securities.
2. Licensing and Registration
Financial institutions and service providers must apply for and maintain proper licenses or charters.
This includes banks, credit unions, mortgage brokers, escrow agents, and money transmitters.
Licenses are contingent upon meeting financial, operational, and legal criteria.
3. Examinations and Supervision
The DFI regularly examines licensed institutions to assess financial health, risk management, and regulatory compliance.
Examinations may include on-site inspections, review of financial statements, and operational audits.
The Department issues reports, recommendations, and may require corrective actions.
4. Consumer Protection
The DFI enforces consumer protection laws related to lending, disclosures, and fair treatment.
It investigates complaints from consumers against financial service providers.
The Department promotes transparency and fair practices in the financial marketplace.
5. Enforcement and Penalties
The DFI has authority to impose penalties, suspend or revoke licenses, and take legal action against violators.
Enforcement actions may include fines, cease-and-desist orders, and referrals for criminal prosecution.
The Department may also require restitution to consumers harmed by unlawful practices.
6. Regulatory Rules and Compliance
Title 208 outlines detailed rules that financial institutions must follow, including operational procedures, reporting requirements, capital adequacy standards, and anti-money laundering compliance.
The rules ensure institutions operate in a safe, sound, and ethical manner.
7. Interagency Cooperation
The DFI collaborates with federal regulators such as the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve, and the Consumer Financial Protection Bureau (CFPB).
Coordination with other state agencies helps address overlapping regulatory responsibilities, including insurance (Title 50), securities (Title 460), and banking activities (Title 419).
Importance of Title 208 WAC
Provides a comprehensive regulatory framework for Washington’s financial services industry.
Protects consumers and maintains confidence in the state’s financial institutions.
Helps prevent financial fraud and misconduct.
Promotes the stability and integrity of the state’s financial system.
Ensures institutions comply with evolving state and federal laws.
Summary
Title 208 governs the Washington Department of Financial Institutions.
The Department licenses, regulates, and supervises banks, credit unions, mortgage brokers, and other financial entities.
It conducts examinations, enforces consumer protection laws, and takes action against violations.
Works in coordination with related codes and federal agencies.
Aims to ensure a safe, sound, and trustworthy financial environment in Washington State.
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