July 24, 2020

FDIC: Final Rule Issued Revising and Codifying Section 19 to Allow Greater Employment Opportunities for Individuals with Certain Minor Criminal Offenses

The Federal Deposit Insurance Corporation (FDIC) approved a final rule to revise and incorporate into the FDIC’s regulations a longstanding Statement of Policy (SOP) related to individuals with certain criminal offenses on their records who seek employment in the banking industry. 

Section 19 of the Federal Deposit Insurance Act (Section 19) prohibits any person from participating in banking who has been convicted of a crime involving dishonesty, breach of trust, or money laundering, or who has entered a pretrial diversion or similar program in connection with the prosecution for such an offense, without first obtaining written consent from the FDIC. 

Based on filings over the past several years, the FDIC expects that the revisions in the final rule will reduce applications required under Section 19 by 30 percent. All of these changes will reduce regulatory burden on financial institutions and individuals.

The final rule will be effective 30 days after publication in the Federal Register, at which time, the existing SOP will be rescinded.

FDIC: PR-87-2020


FDIC Chairman Jelena McWilliams’s statement
Fact Sheet
FDIC’s Final Rule

This post was originally published here.