An Identity in Disarray: The Federal Deposit Insurance Corporation’s Government-Agency Status

In the last three years, the world has experienced one of the worst banking catastrophes in its history. In the United States alone, some 282 banks have failed since January 2008. This burgeoning devastation has catapulted the Federal Deposit Insurance Corporation (“FDIC”) to the forefront of crisis-management as it acts as receiver for each of these failed institutions. With high stakes, vast consequences, and little time to dither, the receivership process and its participants require stable, clear and predictable jurisprudence. One issue, however, continues to elude these jurisprudential virtues: is the FDIC, when acting as a failed bank’s receiver, considered an agency of the United States, or merely a private party? Surprisingly, the answer is far from clear, and the ramifications significant and numerous. Years of judicial analysis have produced cacophony, not chorus, and there is a startling absence of scholarly exposition. This article, after outlining the problem, delineates and critically evaluates two solutions.