The Federal Deposit Insurance Corporation (FDIC) preserves and promotes public confidence in the U.S. financial system by insuring deposits in banks and thrift institutions for at least $250,000; by identifying, monitoring and addressing risks to the deposit insurance funds; and by limiting the effect on the economy and the financial system when a bank or thrift institution fails.

An independent agency of the federal government, the FDIC was created in 1933 in response to the thousands of bank failures that occurred in the 1920s and early 1930s. Since the start of FDIC insurance on January 1, 1934, no depositor has lost a single cent of insured funds as a result of a failure.

The FDIC receives no Congressional appropriations – it is funded by premiums that banks and thrift institutions pay for deposit insurance coverage and from earnings on investments in U.S. Treasury securities. The FDIC insures trillions of dollars of deposits in U.S. banks and thrifts – deposits in virtually every bank and thrift in the country.

The standard insurance amount is $250,000 per depositor, per insured bank, for each account ownership category. The FDIC’s Electronic Deposit Insurance Estimatorcan help you determine if you have adequate deposit insurance for your accounts.

The FDIC insures deposits only. It does not insure securities, mutual funds or similar types of investments that banks and thrift institutions may offer. (Deposit Insurance: What’s Covered distinguishes between what is and is not protected by FDIC insurance.)

The FDIC directly examines and supervises about 4,000 banks and savings banks for operational safety and soundness, more than half of the institutions in the banking system. Banks can be chartered by the states or by the federal government. Banks chartered by states also have the choice of whether to join the Federal Reserve System. The FDIC is the primary federal regulator of banks that are chartered by the states that do not join the Federal Reserve System. In addition, the FDIC is the back-up supervisor for the remaining insured banks and thrift institutions.

The FDIC also examines banks for compliance with consumer protection laws, including the Fair Credit Billing Act, the Fair Credit Reporting Act, the Truth-In-Lending Act, and the Fair Debt Collection Practices Act, to name a few. Finally, the FDIC examines banks for compliance with the Community Reinvestment Act (CRA) which requires banks to help meet the credit needs of the communities they were chartered to serve.

To protect insured depositors, the FDIC responds immediately when a bank or thrift institution fails. Institutions generally are closed by their chartering authority – the state regulator, or the Office of the Comptroller of the Currency. The FDIC has several options for resolving institution failures, but the one most used is to sell deposits and loans of the failed institution to another institution. Customers of the failed institution automatically become customers of the assuming institution. Most of the time, the transition is seamless from the customer’s point of view.

The FDIC is headquartered in Washington, D.C., but conducts much of its business in regional and field offices around the country.

The FDIC is managed by a five-person Board of Directors, all of whom are appointed by the President and confirmed by the Senate, with no more than three being from the same political party.


For more information, visit: https://www.fdic.gov/


A license is an authorization given by the owner of land to another to perform an act or acts on the owner’s property. The owner’s permission may be expressed or implied. The license is a personal privilege; it is not an interest or right in the land. Generally, licenses are revocable at will by the land owner. The classic license is personal to the license holder and cannot be transferred, assigned, conveyed, or inherited. Written license agreements frequently blur the line between easements and licenses.


Disputes large and small are a regular part of life in homeowner associations. While always prepared to litigate, Epsten believes it is preferable to settle many disputes through quicker and less costly methods, including negotiation and mediation. Experience has shown that the results of mediation can be effective and satisfying. Mediation can be the fastest, most-effective solution to conflicts between homeowners and homeowners in conflict with their association.

In mediation, the disputing parties present their problem to a neutral third person who is an experienced mediator. Investigation and documentation of the complaint is made and the mediator conducts meetings to openly explore the opposing positions and guide negotiation between the parties. If the parties do not reach a compromise on their own, the mediator presents a resolution of the dispute that the parties can either accept or reject. While mediation is non-binding, studies have documented a success rate of 85% when a mediator is employed to settle a dispute.


An association must provide notice to owners and non-owner residents of the project of the presence of asbestos. See California Health & Safety Code Sections 25915 et seq. There is some ambiguity regarding the applicability of the statutes. Sections 25915 through 25919.7 are part of Chapter 10.4 of the Health & Safety Code. Section 25919.2 states in part that “‘Building,’ as used in this chapter, means all or part of any ‘public and commercial building,’ … except that ‘building’ shall not mean residential dwellings.” However, Section 25915.2(d), also part of this chapter, states in part that other subparagraphs in Section 25915.2 “shall not be construed to require owners of a building or part of a building within a residential common interest development to mail written notification to other owners of a building or part of a building within the residential common interest development,” if certain conditions are met. The implication is that these requirements do apply in residential developments if the conditions are not met, or that a community association must meet the conditions when there is asbestos in a common interest development. Although there may be an ambiguity, we believe associations are better protected by following the requirements of Section 25915.2.


California Associations are subject to the Fair Housing Act (“FHA”) and Unruh Act (“Unruh”). Unruh prohibits age discrimination. FHA prohibits familial status discrimination. “Familial status” discrimination is discrimination against a minor who resides with a parent, legal guardian, or person having authorized custody of the child. Qualified senior communities are generally exempted from these prohibitions. Use restrictions and rules should be scrutinized to ensure they do not discriminate against children in content or application.

D&O Insurance

This stands for Directors and Officers Liability Insurance. D&O insurance is intended to defend and indemnify the directors and officers of an association and often the association itself, usually against claims made by other persons arising out of alleged losses or damage other than bodily injury or property damage and possibly other personal (non-bodily) injury losses, such as libel or slander, that are covered under the typical commercial general liability (“CGL”) insurance policy. For directors and officers to obtain the limitations against liability offered by Civil Code section 5800, associations must have D&O insurance in the amounts specified in the statute. See the Article, Insurance for Community Associations, for more information.

Employment Laws

The federal and state statutes and cases that define the rights, duties and obligations of employers and employees to each other. See also Employees. Associations with employees should always have an Employer’s Liability Insurance policy to protect against possible liability arising from the employment relationship.


An outdated expression implying a physical or mental disability. The term is used in the FFHAA, but disabled advocates and subsequent legislation use the term “disability.” While different laws contain slightly different definitions, a “handicap” or “disability” is generally held to mean a physical or mental condition which interferes with a person’s ability to perform life functions.


The act or process of bringing a legal action in court. It entails filing a lawsuit, defending against a lawsuit, conducting discovery, filing motions, a trial before a judge and/or jury, any post-trial motions and appeals.

Open Meetings

A meeting of the board of directors, other than an emergency meeting or executive session. The Common Interest Development Open Meeting Act (Civ. Code §4900 et seq.) sets forth the requirements and parameters for open board meetings. Other than meetings properly held in executive session (Civ. Code §4935), all meetings of the board are open to association members. A “board meeting” is defined in Civil Code section 4090. Neither open nor executive session meetings may be conducted via a series of electronic transmissions, except under specified emergency circumstances following strict procedural requirements set forth in the Open Meeting Act. (Civil Code §4910) The Open Meeting Act is distinguished from the Brown Act, which applies to public commissions, boards and councils and other public agencies in California, and which does not apply to common interest developments.