WASHINGTON — The Federal Deposit Insurance Corp. announced a new system Tuesday for classifying violations of consumer-protection rules that the agency spots during exams.

Replacing a previous two-level system, the agency unveiled a three-category method for different types of violations.

"Because different types of violations present different levels of risk to consumers and to institutions, a method of classifying violations is necessary to communicate the FDIC's level of concern regarding the violations identified," the agency said in a letter to all the banks it supervises.

A "Level 1" violation recorded in the official report for a bank's compliance exam indicates a "low-severity" violation, meaning the violation was "isolated or sporadic", or had a limited impact.

The next step up is "Level 2" or "medium severity." Those violations, the FDIC said, reflect "systemic, recurring, or repetitive errors that represent a failure of the bank to meet a key purpose of the underlying regulation or statute."

The highest level of severity for a compliance violation will be "Level 3". Those violations cause "significant harm to consumers or members of a community," the agency said.

Level 3 violations often correspond with the institution needing to provide restitution of more than $10,000 in aggregate, and can also include violations of anti-discrimination rules.

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