Administrative law judges (ALJs) serve as independent, impartial triers of fact in formal proceedings requiring a decision on the record. ALJs conduct formal hearings involving cases where parties are given advance notice of a hearing; an opportunity to submit facts, arguments, offers of settlement, or proposals of adjustment; and an opportunity to be accompanied, represented, and advised by counsel or other qualified representatives. ALJs at the Office of Financial Institution Adjudication (OFIA) are not subject to the supervision or direction of, or responsible to, any officer, employee, or agent engaged in the performance of investigative or prosecuting functions.
The primary role of OFIA ALJs is to conduct enforcement proceedings under the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) for the Federal Deposit Insurance Corporation (FDIC), the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System (FRB), and the National Credit Union Administration (NCUA). ALJs are assigned cases in rotation to the extent practicable and preside during the hearing stages of each enforcement action over all motions and discovery. After each hearing (or following summary disposition if there are no disputes as to material facts in the case), the ALJ makes a recommended determination as to whether the required statutory elements for a given sanction have been met, and, where it has been assessed, whether a civil money penalty is warranted.
The authority of federal ALJs comes from the Administrative Procedure Act (APA) of 1946, 5 U.S.C. § 500 et seq. The APA is designed to guarantee the decisional independence of ALJs and ensure fairness in administrative proceedings before federal government agencies.