The US Federal Reserve just fined Orrstown Bank for selling mortgages without flood insurance on the underlying property. This sloppiness probably happened because Orrstown's residential loans jumped ~35% in the course of 1 year ($503e6 in 2006 from $373e6 in 2005, for a point of contrast, PSECU did 12%).

According to their latest SEC quarterly filing, Orrstown still holds those mortgages. Let's just hope that they didn't also screw up the valuation of the underlying houseowner's financial stability.