Section 19 of the FDIA (Federal Deposit Insurance Act) prevents banks and other financial institutions from hiring or employing individuals who have been convicted of, or entered into a pretrial diversion program for, any criminal offense involving dishonesty or breach of trust or money laundering.  If a FDIC (Federal Deposit Insurance Corporation) insured institution, such as a bank or other financial institution, were to employ an individual who had one of these criminal offenses on their record, they could face a daily fine of $1,000,000 for every day the employee works for the company.  (12 U.S.C. § 1829(b))

 

Section 19 of the FDIA regulations provides a method to obtain written consent from the FDIC that allows a financial institution to hire an employee despite the employee having a “breach of trust” or “dishonesty” criminal offense on their criminal record.  (12 U.S.C. § 1829(a)(2))

 

If you have a “breach of trust” or “dishonesty” criminal offense and were denied a position with a financial institution as a result of that offense, there is still a procedure, which can allow you to obtain employment.

 

There are two methods that an individual can take to apply for the FDIC’s written consent to work at an FDIC insured institution.  The first method requires a FDIC insured institution to file on behalf of, or sponsor, the prospective employee.  This type of sponsorship generally only occurs when the institution is seeking to employ a high level executive employee.

 

The second method is considered on a case-by-case basis where good cause is demonstrated to (1) waive the requirement that an institution must sponsor the employee and (2) the individual can demonstrate that they are truly deserving of the Section 19 waiver.  However, not everyone is eligible to petition and obtain a waiver.  It is important to speak with an attorney about your specific circumstances to see if you would qualify for such a waiver from the FDIC.

 

The application process requires filing an application with supporting evidence and documentation to the FDIC Regional Office where you reside.  The FDIC then evaluates the application and conducts background checks with the DEA (Drug Enforcement Administration) and ICE (U.S. Immigration and Customs Enforcement), and if recommended, the application is sent to the FDIC headquarters in Washington, D.C.  The FDIC headquarters makes the final decision as to whether or not a waiver of Section 19 is approved.  A successfully granted waiver will provide the individual with an approval order allowing them to be eligible for employment at an FDIC insured institution.

 

The application process is quite overwhelming for an unrepresented party to accomplish on their own as several legal standards must be met in order for the petition to be granted.  If you are considering applying for a Section 19 waiver, you should contact our law firm, which has experience in successfully obtaining these waivers.

 

Answers to common questions

 

  1. How long does it take to complete an appeal?
    Typically, it is taking anywhere from 5-12 months to complete the entire process.  This is because the petition must first go to the proper regional FDIC office, where they must review the application and review your background checks prior to it being sent to the FDIC headquarters in Washington DC for final approval.
  2. What is the typical cost?
    Higbee & Associates represents clients all over the US.  The fee for this service is $2,500.  Interest free payment plans are available.  We can begin working on your case for as low as $500.  The fee for the service includes all legal fees, costs, and postage.  Fees may increase if your case requires special attention due to exigent circumstances or if your petition is denied and you would like to appeal the FDIC ruling.
  3. What are the chances of success?
    The chances of success vary greatly on a case to case basis. In our experience, some of the following are factors the FDIC takes into consideration: convictions over 10 years old, the underlying offense was small in both nature and severity, and the individual has a minimal criminal record.

 

If you are interested in hiring an attorney to represent you in applying for a Section 19 waiver, we would be glad to help. Questions and consultations are $250 for the first hour. We will handle the entire waiver process, including attending any hearings, for a flat-fee of $5,000. We represent clients all over the US.  We can represent you no matter where you live.

 

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