Lake Shore Bancorp in Dunkirk, N.Y., has terminated a pair of change-in-control agreements to comply with a recent formal agreement with the Office of the Comptroller of the Currency.
The $696 million-asset company disclosed in a regulatory filing that it did not extend the one-year agreements with Rachel Foley, its chief financial officer and treasurer, and Jeffrey Werdein, executive vice president of its commercial division, due to “regulatory restrictions” in the OCC agreement.
Lake Shore agreed to improve its IT security and controls and IT risk governance after the OCC “found unsafe or unsound” practices. The OCC agreement required Lake Shore to develop, adopt and implement a written program to effectively assess and manage IT activities, among other things.
Lake Shore disclosed in March that someone gained unauthorized access to data in its internal systems. The company said its bank experienced a data security incident in November 2021 that barred employees from accessing internal systems and data for “a limited period of time.”
The bank launched an investigation and hired a digital forensics firm to help determine the scope of the incident and identify potentially impacted data. Lake Shore also notified law enforcement and the OCC.
Lake Shore separately disclosed this week that it did not extend the three-year employment agreement for Daniel Reininga, who plans to retire as president and CEO in May. The company said it will conduct a national search for a successor.