12 U.S.C. § 1829 — Penalty for unauthorized participation by

Page 1130 TITLE 12—BANKS AND BANKING § 1828b 81, 83 to 86, 90, 91, 93, 93a, 94, 141 to 144, 161, 164, 181, 182, 192 to 194, 196, 215c, 481 to 485, 501, 541, 548, and 582 of this title. See, also, sections 8, 333, 334, 475, 656, 709, 1004, and 1005 of Title 18, Crimes and Criminal Proce- dure. For complete classification of R.S. §§ 5133 to 5244 to the Code, see Tables. The Bank Holding Company Act of 1956, referred to in subsec. (b)(2)(A), (4)(A), is act May 9, 1956, ch. 240, 70 Stat. 133, which is classified principally to chapter 17 (§ 1841 et seq.) of this title. For complete classification of this Act to the Code, see Short Title note set out under section 1841 of this title and Tables. The Federal Reserve Act, referred to in subsec. (b)(2)(A), (4)(A), is act Dec. 23, 1913, ch. 6, 38 Stat. 251, which is classified principally to chapter 3 (§ 221 et seq.) of this title. For complete classification of this Act to the Code, see References in Text note set out under sec- tion 226 of this title and Tables. The Federal Deposit Insurance Act, referred to in subsec. (c)(1)(A), is act Sept. 21, 1950, ch. 967, § 2, 64 Stat. 873, which is classified generally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under section 1811 of this title and Tables. CODIFICATION Section was enacted as part of the Gramm-Leach-Bli- ley Act, and not as part of the Federal Deposit Insur- ance Act which comprises this chapter. AMENDMENTS 2006—Subsecs. (a)(1)(B), (b)(2)(B), (4)(B), (c)(1)(B). Pub. L. 109–173 substituted ‘‘the Deposit Insurance Fund’’ for ‘‘any Federal deposit insurance fund’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2006 AMENDMENT Amendment by Pub. L. 109–173 effective Mar. 31, 2006, see section 9(j) of Pub. L. 109–173, set out as a note under section 24 of this title. EFFECTIVE DATE Section effective 120 days after Nov. 12, 1999, see sec- tion 161 of Pub. L. 106–102, set out as an Effective Date of 1999 Amendment note under section 24 of this title. § 1828b. Interagency data sharing (a) In general To the extent not prohibited by other law, the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the Federal Deposit Insurance Corporation, and the Board of Gov- ernors of the Federal Reserve System shall make available to the Attorney General and the Federal Trade Commission any data in the pos- session of any such banking agency that the antitrust agency deems necessary for antitrust review of any transaction requiring notice to any such antitrust agency or the approval of such agency under section 1842 or 1843 of this title, section 1828(c) of this title, the National Bank Consolidation and Merger Act [12 U.S.C. 215 et seq.], section 1467a of this title, or the antitrust laws. (b) Confidentiality requirements (1) In general Any information or material obtained by any agency pursuant to subsection (a) shall be treated as confidential. (2) Procedures for disclosure If any information or material obtained by any agency pursuant to subsection (a) is pro- posed to be disclosed to a third party, written notice of such disclosure shall first be pro- vided to the agency from which such informa- tion or material was obtained and an oppor- tunity shall be given to such agency to oppose or limit the proposed disclosure. (3) Other privileges not waived by disclosure under this section The provision by any Federal agency of any information or material pursuant to sub- section (a) to another agency shall not con- stitute a waiver, or otherwise affect, any privilege any agency or person may claim with respect to such information under Federal or State law. (4) Exception No provision of this section shall be con- strued as preventing or limiting access to any information by any duly authorized com- mittee of the Congress or the Comptroller General of the United States. (c) Banking agency information sharing The provisions of subsection (b) shall apply to— (1) any information or material obtained by any Federal banking agency (as defined in sec- tion 1813(z) of this title) from any other Fed- eral banking agency; and (2) any report of examination or other con- fidential supervisory information obtained by any State agency or authority, or any other person, from a Federal banking agency. (Pub. L. 106–102, title I, § 132, Nov. 12, 1999, 113 Stat. 1382.) Editorial Notes REFERENCES IN TEXT The National Bank Consolidation and Merger Act, re- ferred to in subsec. (a), is act Nov. 7, 1918, ch. 209, as added by Pub. L. 86–230, § 20, Sept. 8, 1959, 73 Stat. 460, which is classified generally to subchapter XVI (§ 215 et seq.) of chapter 2 of this title. For complete classifica- tion of this Act to the Code, see Short Title note set out under section 215 of this title and Tables. CODIFICATION Section was enacted as part of the Gramm-Leach-Bli- ley Act, and not as part of the Federal Deposit Insur- ance Act which comprises this chapter. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective 120 days after Nov. 12, 1999, see sec- tion 161 of Pub. L. 106–102, set out as an Effective Date of 1999 Amendment note under section 24 of this title. § 1829. Penalty for unauthorized participation by convicted individual (a) Prohibition (1) In general Except with the prior written consent of the Corporation— (A) any person who has been convicted of any criminal offense involving dishonesty or a breach of trust or money laundering, or has agreed to enter into a pretrial diversion or similar program in connection with a prosecution for such offense, may not— Page 1131 TITLE 12—BANKS AND BANKING § 1829 1 See References in Text note below. (i) become, or continue as, an institu- tion-affiliated party with respect to any insured depository institution; (ii) own or control, directly or indi- rectly, any insured depository institution; or (iii) otherwise participate, directly or in- directly, in the conduct of the affairs of any insured depository institution; and (B) any insured depository institution may not permit any person referred to in sub- paragraph (A) to engage in any conduct or continue any relationship prohibited under such subparagraph. (2) Minimum 10-year prohibition period for certain offenses (A) In general If the offense referred to in paragraph (1)(A) in connection with any person referred to in such paragraph is— (i) an offense under— (I) section 215, 656, 657, 1005, 1006, 1007, 1008,1 1014, 1032, 1344, 1517, 1956, or 1957 of title 18; or (II) section 1341 or 1343 of such title which affects any financial institution (as defined in section 20 of such title); or (ii) the offense of conspiring to commit any such offense, the Corporation may not consent to any ex- ception to the application of paragraph (1) to such person during the 10-year period begin- ning on the date the conviction or the agree- ment of the person becomes final. (B) Exception by order of sentencing court (i) In general On motion of the Corporation, the court in which the conviction or the agreement of a person referred to in subparagraph (A) has been entered may grant an exception to the application of paragraph (1) to such person if granting the exception is in the interest of justice. (ii) Period for filing A motion may be filed under clause (i) at any time during the 10-year period de- scribed in subparagraph (A) with regard to the person on whose behalf such motion is made. (b) Penalty Whoever knowingly violates subsection (a) shall be fined not more than $1,000,000 for each day such prohibition is violated or imprisoned for not more than 5 years, or both. (c) Exceptions (1) Certain older offenses (A) In general With respect to an individual, subsection (a) shall not apply to an offense if— (i) it has been 7 years or more since the offense occurred; or (ii) the individual was incarcerated with respect to the offense and it has been 5 years or more since the individual was re- leased from incarceration. (B) Offenses committed by individuals 21 or younger For individuals who committed an offense when they were 21 years of age or younger, subsection (a) shall not apply to the offense if it has been more than 30 months since the sentencing occurred. (C) Limitation This paragraph shall not apply to an of- fense described under subsection (a)(2). (2) Expungement and sealing With respect to an individual, subsection (a) shall not apply to an offense if— (A) there is an order of expungement, seal- ing, or dismissal that has been issued in re- gard to the conviction in connection with such offense; and (B) it is intended by the language in the order itself, or in the legislative provisions under which the order was issued, that the conviction shall be destroyed or sealed from the individual’s State, Tribal, or Federal record, even if exceptions allow the record to be considered for certain character and fit- ness evaluation purposes. (3) De minimis exemption (A) In general Subsection (a) shall not apply to such de minimis offenses as the Corporation deter- mines, by rule. (B) Confinement criteria In issuing rules under subparagraph (A), the Corporation shall include a requirement that the offense was punishable by a term of three years or less confined in a correctional facility, where such confinement— (i) is calculated based on the time an in- dividual spent incarcerated as a punish- ment or a sanction, not as pretrial deten- tion; and (ii) does not include probation or parole where an individual was restricted to a particular jurisdiction or was required to report occasionally to an individual or a specific location. (C) Bad check criteria In setting the criteria for de minimis of- fenses under subparagraph (A), if the Cor- poration establishes criteria with respect to insufficient funds checks, the Corporation shall require that the aggregate total face value of all insufficient funds checks across all convictions or program entries related to insufficient funds checks is $2,000 or less. (D) Designated lesser offenses Subsection (a) shall not apply to certain lesser offenses (including the use of a fake ID, shoplifting, trespass, fare evasion, driv- ing with an expired license or tag, and such other low-risk offenses as the Corporation may designate) if 1 year or more has passed since the applicable conviction or program entry. Page 1132 TITLE 12—BANKS AND BANKING § 1829 2 So in original. Probably should be preceded by ‘‘the’’. (d) Bank holding companies (1) In general Subsections (a) and (b) shall apply to any company (other than a foreign bank) that is a bank holding company and any organization organized and operated under section 25A of the Federal Reserve Act [12 U.S.C. 611 et seq.] or operating under section 25 of the Federal Reserve Act [12 U.S.C. 601 et seq.], as if such bank holding company or organization were an insured depository institution, except that such subsections shall be applied for purposes of this subsection by substituting ‘‘Board of Governors of the Federal Reserve System’’ for ‘‘Corporation’’ each place that term appears in such subsections. (2) Authority of Board The Board of Governors of the Federal Re- serve System may provide exemptions, by reg- ulation or order, from the application of para- graph (1) if the exemption is consistent with the purposes of this subsection. (e) Savings and loan holding companies (1) In general Subsections (a) and (b) shall apply to any savings and loan holding company as if such savings and loan holding company were an in- sured depository institution, except that such subsections shall be applied for purposes of this subsection by substituting ‘‘Board of Gov- ernors of the Federal Reserve System’’ for ‘‘Corporation’’ each place that term appears in such subsections. (2) Authority of Director The Board of Governors of the Federal Re- serve System may provide exemptions, by reg- ulation or order, from the application of para- graph (1) if the exemption is consistent with the purposes of this subsection. (f) Consent applications (1) In general The Corporation shall accept consent appli- cations from an individual and from an in- sured depository institution or depository in- stitution holding company on behalf of an in- dividual that are filed separately or contem- poraneously with a regional office of the Cor- poration. (2) Sponsored applications filed with regional offices Consent applications filed at a regional of- fice of the Corporation by an insured deposi- tory institution or depository institution holding company on behalf of an individual— (A) shall be reviewed by such office; (B) may be approved or denied by such of- fice, if such authority has been delegated to such office by the Corporation; and (C) may only be denied by such office if the general counsel of the Corporation (or a des- ignee) certifies that the denial is consistent with this section. (3) Individual applications filed with regional offices Consent applications filed at a regional of- fice by an individual— (A) shall be reviewed by such office; and (B) may be approved or denied by such of- fice, if such authority has been delegated to such office by the Corporation, except with respect to— (i) cases involving an offense described under subsection (a)(2); and (ii) such other high-level security cases as may be designated by the Corporation. (4) National office review The national office of the Corporation shall— (A) review any consent application with respect to which a regional office is not au- thorized to approve or deny the application; and (B) review any consent application that is denied by a regional office, if the individual requests a review by the national office. (5) Forms and instructions (A) Availability The Corporation shall make all forms and instructions related to consent applications available to the public, including on the website of the Corporation. (B) Contents The forms and instructions described under subparagraph (A) shall provide a sam- ple cover letter and a comprehensive list of items that may accompany the application, including clear guidance on evidence that may support a finding of rehabilitation. (6) Consideration of criminal history (A) Regional office consideration In reviewing a consent application, a re- gional office shall— (i) primarily rely on the criminal history record of the Federal Bureau of Investiga- tion; and (ii) provide such record to the applicant to review for accuracy. (B) Certified copies The Corporation may not require an appli- cant to provide certified copies of criminal history records unless the Corporation deter- mines that there is a clear and compelling justification to require additional informa- tion to verify the accuracy of the criminal history record of the Federal Bureau of In- vestigation. (7) Consideration of rehabilitation Consistent with title VII of the Civil Rights Act of 1964 (42 U.S.C. 2000e et seq.), the Cor- poration shall— (A) conduct an individualized assessment when evaluating consent applications that takes into account evidence of rehabilita- tion, the applicant’s age at the time of the conviction or program entry, the time that has elapsed since conviction or program entry, and the relationship of individual’s 2 offense to the responsibilities of the applica- ble position; (B) consider the individual’s employment history, letters of recommendation, certifi- Page 1133 TITLE 12—BANKS AND BANKING § 1829 cates documenting participation in sub- stance abuse programs, successful partici- pating in job preparation and educational programs, and other relevant mitigating evi- dence; and (C) consider any additional information the Corporation determines necessary for safety and soundness. (8) Scope of employment With respect to an approved consent applica- tion filed by an insured depository institution or depository institution holding company on behalf of an individual, if the Corporation de- termines it appropriate, such approved con- sent application shall allow the individual to work for the same employer (without restric- tions on the location) and across positions, ex- cept that the prior consent of the Corporation (which may require a new application) shall be required for any proposed significant changes in the individual’s security-related duties or responsibilities, such as promotion to an offi- cer or other positions that the employer deter- mines will require higher security screening credentials. (9) Coordination with the NCUA In carrying out this section, the Corporation shall consult and coordinate with the National Credit Union Administration as needed to pro- mote consistent implementation where appro- priate. (g) Definitions In this section: (1) Consent application The term ‘‘consent application’’ means an application filed with Corporation 2 by an indi- vidual (or by an insured depository institution or depository institution holding company on behalf of an individual) seeking the written consent of the Corporation under subsection (a)(1). (2) Criminal offense involving dishonesty The term ‘‘criminal offense involving dis- honesty’’— (A) means an offense under which an indi- vidual, directly or indirectly— (i) cheats or defrauds; or (ii) wrongfully takes property belonging to another in violation of a criminal stat- ute; (B) includes an offense that Federal, State, or local law defines as dishonest, or for which dishonesty is an element of the of- fense; and (C) does not include— (i) a misdemeanor criminal offense com- mitted more than one year before the date on which an individual files a consent ap- plication, excluding any period of incarcer- ation; or (ii) an offense involving the possession of controlled substances. (3) Pretrial diversion or similar program The term ‘‘pretrial diversion or similar pro- gram’’ means a program characterized by a suspension or eventual dismissal or reversal of charges or criminal prosecution upon agree- ment by the accused to restitution, drug or al- cohol rehabilitation, anger management, or community service. (Sept. 21, 1950, ch. 967, § 2[19], 64 Stat. 893; Pub. L. 101–73, title IX, § 910(a), Aug. 9, 1989, 103 Stat. 477; Pub. L. 101–647, title XXV, § 2502(a), Nov. 29, 1990, 104 Stat. 4860; Pub. L. 102–550, title XV, § 1505, Oct. 28, 1992, 106 Stat. 4055; Pub. L. 103–322, title XXXII, § 320605, Sept. 13, 1994, 108 Stat. 2119; Pub. L. 109–351, title VII, § 710(a), Oct. 13, 2006, 120 Stat. 1990; Pub. L. 111–203, title III, § 363(8), July 21, 2010, 124 Stat. 1554; Pub. L. 117–263, div. E, title LVII, § 5705(a), Dec. 23, 2022, 136 Stat. 3411.) Editorial Notes REFERENCES IN TEXT Section 1008 of title 18, referred to in subsec. (a)(2)(A)(i)(I), was repealed by Pub. L. 101–73, title IX, § 961(g)(1), Aug. 9, 1989, 103 Stat. 500. Sections 25 and 25A of the Federal Reserve Act, re- ferred to in subsec. (d)(1), are classified to subchapters I (§ 601 et seq.) and II (§ 611 et seq.), respectively, of chapter 6 of this title. The Civil Rights Act of 1964, referred to in subsec. (f)(7), is Pub. L. 88–352, July 2, 1964, 78 Stat. 241. Title VII of the Act is classified generally to subchapter VI (§ 2000e et seq.) of chapter 21 of Title 42, The Public Health and Welfare. For complete classification of this Act to the Code, see Short Title note set out under sec- tion 2000a of Title 42 and Tables. AMENDMENTS 2022—Subsec. (c). Pub. L. 117–263, § 5705(a)(1), added subsec. (c). Subsecs. (f), (g). Pub. L. 117–263, § 5705(a)(2), added sub- secs. (f) and (g). 2010—Subsec. (e). Pub. L. 111–203 substituted ‘‘Board of Governors of the Federal Reserve System’’ for ‘‘Di- rector of the Office of Thrift Supervision’’ in two places. 2006—Subsecs. (d), (e). Pub. L. 109–351 added subsecs. (d) and (e). 1994—Subsec. (a)(2)(A)(i)(I). Pub. L. 103–322 sub- stituted ‘‘1517, 1956, or 1957’’ for ‘‘or 1956’’. 1992—Subsec. (a)(1)(A). Pub. L. 102–550 inserted ‘‘or money laundering’’ after ‘‘breach of trust’’. 1990—Subsec. (a). Pub. L. 101–647 amended subsec. (a) generally. Prior to amendment, subsec. (a) read as fol- lows: ‘‘Except with the prior written consent of the Corporation— ‘‘(1) any person who has been convicted of any criminal offense involving dishonesty or a breach of trust may not participate, directly or indirectly, in any manner in the conduct of the affairs of an in- sured depository institution; and ‘‘(2) an insured depository institution may not per- mit such participation.’’ 1989—Pub. L. 101–73 amended section generally. Prior to amendment, section read as follows: ‘‘Except with the written consent of the Corporation, no person shall serve as a director, officer, or employee of an insured bank who has been convicted, or who is hereafter con- victed, of any criminal offense involving dishonesty or a breach of trust. For each willful violation of this pro- hibition, the bank involved shall be subject to a pen- alty of not more than $100 for each day this prohibition is violated, which the Corporation may recover for its use.’’ Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2010 AMENDMENT Amendment by Pub. L. 111–203 effective on the trans- fer date, see section 351 of Pub. L. 111–203, set out as a note under section 906 of Title 2, The Congress. Page 1134 TITLE 12—BANKS AND BANKING § 1829a PROVISIONS NOT REPEALED, MODIFIED OR AFFECTED Nothing contained in sections 201 to 205 and 207 of Pub. L. 89–695 amending sections 1813 and 1817 to 1820 and repealing section 77 of this title to be construed as repealing, modifying, or affecting this section, see sec- tion 206 of Pub. L. 89–695, set out as a note under sec- tion 1813 of this title. § 1829a. Participation by State nonmember in- sured banks in lotteries and related activi- ties (a) Prohibited activities A State nonmember insured bank may not— (1) deal in lottery tickets; (2) deal in bets used as a means or substitute for participation in a lottery; (3) announce, advertise, or publicize the ex- istence of any lottery; or (4) announce, advertise, or publicize the ex- istence or identity of any participant or win- ner, as such, in a lottery. (b) Use of banking premises prohibited A State nonmember insured bank may not permit— (1) the use of any part of any of its banking offices by any person for any purpose forbid- den to the bank under subsection (a), or (2) direct access by the public from any of its banking offices to any premises used by any person for any purpose forbidden to the bank under subsection (a). (c) Definitions As used in this section— (1) The term ‘‘deal in’’ includes making, tak- ing, buying, selling, redeeming, or collecting. (2) The term ‘‘lottery’’ includes any arrange- ment, other than a savings promotion raffle, whereby three or more persons (the ‘‘partici- pants’’) advance money or credit to another in exchange for the possibility or expectation that one or more but not all of the partici- pants (the ‘‘winners’’) will receive by reason of their advances more than the amounts they have advanced, the identity of the winners being determined by any means which in- cludes— (A) a random selection; (B) a game, race, or contest; or (C) any record or tabulation of the result of one or more events in which any partici- pant has no interest except for its bearing upon the possibility that he may become a winner. (3) The term ‘‘lottery ticket’’ includes any right, privilege, or possibility (and any ticket, receipt, record, or other evidence of any such right, privilege, or possibility), of becoming a winner in a lottery. (4) The term ‘‘savings promotion raffle’’ means a contest in which the sole consider- ation required for a chance of winning des- ignated prizes is obtained by the deposit of a specified amount of money in a savings ac- count or other savings program, where each ticket or entry has an equal chance of being drawn, such contest being subject to regula- tions that may from time to time be promul- gated by the appropriate prudential regulator (as defined in section 5481 of this title). (d) Lawful banking services connected with op- eration of lottery Nothing contained in this section prohibits a State nonmember insured bank from accepting deposits or cashing or otherwise handling checks or other negotiable instruments, or per- forming other lawful banking services for a State operating a lottery, or for an officer or employee of that State who is charged with the administration of the lottery. (e) Regulations; enforcement The Board of Directors shall prescribe such regulations as may be necessary to the strict en- forcement of this section and the prevention of evasions thereof. (Sept. 21, 1950, ch. 967, § 2[20], as added Pub. L. 90–203, § 3, Dec. 15, 1967, 81 Stat. 610; amended Pub. L. 103–325, title VI, § 602(a)(51), Sept. 23, 1994, 108 Stat. 2290; Pub. L. 113–251, § 3(c), Dec. 18, 2014, 128 Stat. 2889.) Editorial Notes AMENDMENTS 2014—Subsec. (c)(2). Pub. L. 113–251, § 3(c)(1), inserted ‘‘, other than a savings promotion raffle,’’ before ‘‘whereby’’ in introductory provisions. Subsec. (c)(4). Pub. L. 113–251, § 3(c)(2), added par. (4). 1994—Subsec. (a)(3). Pub. L. 103–325 inserted ‘‘or’’ at end. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective Apr. 1, 1968, see section 6 of Pub. L. 90–203, set out as a note under section 25a of this title. § 1829b. Retention of records by insured deposi- tory institutions (a) Congressional findings and declaration of purpose (1) Findings Congress finds that— (A) adequate records maintained by in- sured depository institutions have a high de- gree of usefulness in criminal, tax, and regu- latory investigations or proceedings, and that, given the threat posed to the security of the Nation on and after the terrorist at- tacks against the United States on Sep- tember 11, 2001, such records may also have a high degree of usefulness in the conduct of intelligence or counterintelligence activi- ties, including analysis, to protect against domestic and international terrorism; and (B) microfilm or other reproductions and other records made by insured depository in- stitutions of checks, as well as records kept by such institutions, of the identity of per- sons maintaining or authorized to act with respect to accounts therein, have been of particular value in proceedings described in subparagraph (A). (2) Purpose It is the purpose of this section to require the maintenance of appropriate types of records by insured depository institutions in the United States where such records have a high degree of usefulness in criminal, tax, or