Financial Institution Letter

Clarifications to the FDIC’s Statement of Policy for Section 19 of the FDI Act

FIL-57-2011

August 8, 2011




Summary:

Section 19 of the Federal Deposit Insurance (FDI) Act prohibits, without the prior written consent of the Federal Deposit Insurance Corporation (FDIC), a person convicted of criminal offense involving dishonesty, breach of trust, money laundering, or drugs from participating in the affairs of an FDIC-insured institution. On May 10, 2011, the FDIC Board of Directors clarified certain criteria in the FDIC’s Statement of Policy (SOP) for Section 19 of the FDI Act, including complete expungement, de minimis factors, and de minimis factors for “bad checks.” Clarification of the criteria is expected to reduce the number of Section 19 applications and regulatory burden. The updated SOP is available on the FDIC’s Web site and was published in the Federal Register on May 13, 2011.

Statement of Applicability to Institutions under $ 1 Billion in Total Assets: This guidance applies to all FDIC-insured depository institutions including community banks.


Distribution:

FDIC-Insured Institutions

Complete Financial Institution Letter: http://www.fdic.gov/news/news/financial/2011/fil11057.html

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