U.S. Code » Title 12 » Chapter CHAPTER 3— FEDERAL RESERVE SYSTEM › Subchapter SUBCHAPTER X— POWERS AND DUTIES OF MEMBER BANKS

12 U.S.C. § 378

Dealers in securities engaging in banking business; individuals or associations engaging in banking business; examinations and reports; penalties

Read at: OLRCuscode.house.gov CornellLII GovInfogovinfo.gov JustiaTitle 12 CasesGoogle Scholar
(a) After the expiration of one year after June 16, 1933, it shall be unlawful—(1) For any person, firm, corporation, association, business trust, or other similar organization, engaged in the business of issuing, underwriting, selling, or distributing, at wholesale or retail, or through syndicate participation, stocks, bonds, debentures, notes, or other securities, to engage at the same time to any extent whatever in the business of receiving deposits subject to check or to repayment upon presentation of a passbook, certificate of deposit, or other evidence of debt, or upon request of the depositor: Provided, That the provisions of this paragraph shall not prohibit national banks or State banks or trust companies (whether or not members of the Federal Reserve System) or other financial institutions or private bankers from dealing in, underwriting, purchasing, and selling investment securities, or issuing securities, to the extent permitted to national banking associations by the provisions of section 24 of this title: Provided further, That nothing in this paragraph shall be construed as affecting in any way such right as any bank, banking association, savings bank, trust company, or other banking institution, may otherwise possess to sell, without recourse or agreement to repurchase, obligations evidencing loans on real estate; or(2) For any person, firm, corporation, association, business trust, or other similar organization to engage, to any extent whatever with others than his or its officers, agents or employees, in the business of receiving deposits subject to check or to repayment upon presentation of a pass book, certificate of deposit, or other evidence of debt, or upon request of the depositor, unless such person, firm, corporation, association, business trust, or other similar organization (A) shall be incorporated under, and authorized to engage in such business by, the laws of the United States or of any State, Territory, or District, and subjected, by the laws of the United States, or of the State, Territory, or District wherein located, to examination and regulation, or (B) shall be permitted by the United States, any State, territory, or district to engage in such business and shall be subjected by the laws of the United States, or such State, territory, or district to examination and regulations or, (C) shall submit to periodic examination by the banking authority of the State, Territory, or District where such business is carried on and shall make and publish periodic reports of its condition, exhibiting in detail its resources and liabilities, such examination and reports to be made and published at the same times and in the same manner and under the same conditions as required by the law of such State, Territory, or District in the case of incorporated banking institutions engaged in such business in the same locality.(b) Whoever shall willfully violate any of the provisions of this section shall upon conviction be fined not more than $5,000 or imprisoned not more than five years, or both, and any officer, director, employee, or agent of any person, firm, corporation, association, business trust, or other similar organization who knowingly participates in any such violation shall be punished by a like fine or imprisonment or both.(June 16, 1933, ch. 89, § 21, 48 Stat. 189; Aug. 23, 1935, ch. 614, title III, § 303, 49 Stat. 707; Pub. L. 86–230, § 23, Sept. 8, 1959, 73 Stat. 466; Pub. L. 90–448, title VIII, § 804(d), Aug. 1, 1968, 82 Stat. 543; Pub. L. 95–369, § 12, Sept. 17, 1978, 92 Stat. 624.)Editorial NotesAmendments

1978—Subsec. (a)(2)(B). Pub. L. 95–369 inserted reference to permission by the United States to engage in such business and subjection by the laws of the United States to examination and regulation.

1968—Subsec. (a)(1). Pub. L. 90–448 inserted “, or issuing securities” in first proviso.

1959—Subsec. (a). Pub. L. 86–230 inserted “and subjected, by the laws of the United States, or of the State, Territory, or District wherein located, to examination and regulation,” after “District,” in cl. (2)(A).

1935—Subsec. (a). Act Aug. 23, 1935, added two provisos to end of par. (1) and amended par. (2) generally.

Statutory Notes and Related SubsidiariesEffective Date of 1968 Amendment

For effective date of amendment by Pub. L. 90–448, see section 808 of Pub. L. 90–448, set out as a note under section 1716b of this title.

Notes of Decisions
Cited in 47 cases, 1946–2019 · leading case: Sec. Indus. Ass'n v. Bd. of Governors of the Fed. Reserve Sys., 468 U.S. 137 (1984).
Sort: Relevance Newest Treatment
Sec. Indus. Ass'n v. Bd. of Governors of the Fed. Reserve Sys., 468 U.S. 137 (1984). · cites it 8× “707 , 12 U. S. C. § 378 (a)(1) (exempting mortgage notes from the coverage of § 21).”
United States v. Andrew Jenkins, 943 F.2d 167 (2d Cir. 1991). · cites it 5× “§ 1952 (a) (1988) (“Travel Act”), and 12 U.S.C. § 378 (1988) (“Glass-Steagall Act”).”
Inv. Co. Inst. v. Camp, 401 U.S. 617 (1971). · cites it 2× “" And § 21 of the same Act, 12 U. S. C. § 378 (a), provides that "it shall be unlawful—(1) For any person, firm, corporation, association, business trust, or other similar organization, engaged in the business of issuing, underwriting, selling, or distributing, at wholesale or…”
Nat'l Credit Union Admin. v. First Nat'l Bank & Trust Co., 522 U.S. 479 (1998). “189 , 12 U. S. C. § 378 (a). [6] The legislative history of § 109, upon which petitioners so heavily rely, supports this conclusion.”
Fed. Sec. L. Rep. P 95,494 Great W. Bank & Trust v. Sol Kotz, 532 F.2d 1252 (9th Cir. 1976). “§ 24 ] or § 21 [ 12 U.S.C. § 378 (a)] that suggests a narrow reading of the word ‘securities.”
Citizens for Responsibility & Ethics in Washington v. Trump, 953 F.3d 178 (2d Cir. 2019). ““ 12 U.S.C. § 378 (a). Discussing 9 the purpose of Glass‐Steagall, the Court concluded that “Congress [] had in 10 mind .”
Am. Bankers Ass'n v. Sec. & Exch. Comm'n, 804 F.2d 739 (D.C. Cir. 1986). · cites it 2× “hall not prohibit national banks or State banks or trust companies (whether or not members of the Federal Reserve System) or other financial institutions or private bankers from dealing in, underwriting, purchasing and selling investment securities, or issuing securities, to the…”
Inv. Co. Inst. v. Camp, 274 F. Supp. 624 (D.D.C. 1967). · cites it 3× “12 U.S.C. § 378 , provides: “(a) After the expiration of one year after June 16, 1933, it shall be unlawful— “(1) For any person, firm, corporation, association, business trust, or other similar organization, engaged in the business of issuing, underwriting, selling, or…”
Inv. Co. Inst. v. C.T. Conover, Comptroller of the Currency, 790 F.2d 925 (D.C. Cir. 1986). · cites it 2× “Section 16 of the Act forbids national banks to underwrite or deal in “securities or stock.” 12 U.”
Bernstein v. Jones (In re I.D. Craig Serv. Corp.), 125 B.R. 453 (W.D. Pa. 1991). · cites it 3× “12 U.S.C. § 378 (a)(2) (footnotes omitted).”
Bd. of Governors of Fed. Reserve Sys. v. Inv. Co. Inst., 450 U.S. 46 (1981). “189 , 12 U. S. C. § 378 . 16 A memorandum submitted to the Board on behalf of the American Bankers Association states, in part: “For well over a century, banks and trust companies in every state have managed and administered customers’ investment funds in the form of trusts,…”
United States v. Andrew Jenkins, 876 F.2d 1085 (2d Cir. 1989). “Count II charged that Jenkins violated 12 U.S.C. § 378 when he engaged in the business of receiving bank deposits without proper authorization.”
Show all 47 citing cases →
Annotations are extracted automatically from the opinions in the Syfert caselaw corpus and ranked by authority, recency, and treatment. Dots show Syfertize treatment of the citing case itself.