The FDIC went after Republic with hammer and tongs and stopped short of claiming the bank was harboring trolls. One of its charges was that the bank engaged in bad behavior by telling its offices how to deal with FDIC visits. This comes into the classic response of tennis player John McEnroe "Surely, you can't be serious". The agency initially sought a $2 million civil money penalty from Republic, but settled for $900,000 and a series of stringent rules for operating the program in its last year.

The joke in this is that Republic improved its performance on RALs for the first quarter ended March 31. It improved them by implementing stricter underwriting rules and handing out less money than before. The estimated loan loss for RALS for the last season was 1.40 percent, down from 1.58 percent in 2011. So much for unsound banking practices.

It seemed obvious as the FDI Cand the Office of the Comptroller of the Currency went after RAL lenders over the last two years that there was a federal decision to halt the RAL program and that any available tool was used to do that. It would have been nice if that agenda - the fact that this was a policy decision-  had been made public.

Bob Scott

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Bob Scott has provided information to the tax and accounting community since 1991, first as technology editor of Accounting Today, and from 1997 through 2009 as editor of its sister publication, Accounting Technology. He is known throughout the industry for his depth of knowledge and for his high journalistic standards.  Scott has made frequent appearances as a speaker, moderator and panelist and events serving tax and accounting professionals. He  has a strong background in computer journalism as an editor with two former trade publications, Computer+Software News and MIS Week and spent several years with weekly and daily newspapers in Morris County New Jersey prior to that.  A graduate of Indiana University with a degree in journalism, Bob is a native of Madison, Ind