On May 11, 2017, the Federal Deposit Insurance Corporation (FDIC) announced that it had reached settlements with Bank of Lake Mills (Bank) and two of its “institution-affiliated parties” (IAPs)—Freedom Stores, Inc. (FSI) and Military Credit Services, LLC (MCS)—for allegedly engaging in unfair and deceptive practices in violation of Section 5 of the Federal Trade Commission (FTC) Act.

The FDIC released orders for restitution and to pay civil money penalties (Orders), but did not release the consent agreements executed by the Bank, FSI or MCS with the stipulated facts and findings. Nonetheless, the Orders define “Eligible Consumers” to include consumers who have applied for and received loans from the Bank through the FSI or MCS channels. The FDIC, therefore, appears to take the position that FSI and MCS are IAPs as a result of operating a channel for a Bank-originated loan.