Administrative Law Keyed to Lawson
Rapaport v. USDOT, Office of Thrift Supervision
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In order for OTS to take any “affirmative action to correct conditions resulting from violations or practices,” it had to show either that the party was “unjustly enriched,” or the party’s “conduct involved a reckless disregard for the law or any applicable regulations or prior order of a Federal banking agency” under Section:1818 of the banking statute. The sole reason OTS concluded Rapaport was unjustly enriched was that he retained some funds belonging to Great Life (the contested capital contribution) while Great Life received the benefits of deposit insurance. Rapaport claimed that this was insufficient proof of unjust enrichment, and the court agreed.
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