Whether a felon can work at a bank depends entirely on what the felony was for. Federal law does not bar everyone with a felony conviction from bank employment. Section 19 of the Federal Deposit Insurance Act only reaches convictions for crimes involving dishonesty, breach of trust, or money laundering.1Office of the Law Revision Counsel. 12 USC 1829 – Penalty for Unauthorized Participation by Convicted Individual A felony assault, DUI, or drug conviction generally falls outside the rule. A theft, fraud, or embezzlement conviction generally falls inside it. And even when a conviction is covered, the 2022 Fair Hiring in Banking Act created several automatic exceptions and a waiver process that make bank employment possible in a wide range of situations.
Which Convictions Actually Trigger the Ban
Section 19 applies to anyone convicted of a criminal offense involving dishonesty, breach of trust, or money laundering, and it covers essentially every bank in the country because it reaches all FDIC-insured depository institutions.1Office of the Law Revision Counsel. 12 USC 1829 – Penalty for Unauthorized Participation by Convicted Individual The FDIC defines a crime of dishonesty as one where a person cheats, defrauds, or wrongfully takes another’s property. Breach of trust means misusing funds or property entrusted to you in a fiduciary or official role. Theft, fraud, embezzlement, forgery, and money laundering are the classic examples.2eCFR. 12 CFR 303.222 – Which Offenses Qualify as Covered Offenses Under Section 19
Drug offenses, including possession with intent to distribute, do not count. Neither do offenses like assault, DUI, or disorderly conduct, because their statutory elements do not involve dishonesty, breach of trust, or money laundering.2eCFR. 12 CFR 303.222 – Which Offenses Qualify as Covered Offenses Under Section 19 If your conviction is for a non-covered offense, Section 19 does not apply at all and no waiver is required. The severity of the charge is not the trigger. A felony drug conviction is outside the rule; a misdemeanor shoplifting conviction is inside it.
Two other points catch people by surprise. Pretrial diversion counts. If you entered a diversion program to resolve a prosecution for a covered offense, Section 19 treats that the same as a conviction, even though the charges may have been dismissed after you met the program’s conditions.3eCFR. 12 CFR Part 303 Subpart L – Section 19 of the Federal Deposit Insurance Act And misdemeanors involving dishonesty are covered too, though there is a built-in exclusion for misdemeanors committed more than one year before the date a consent application would be filed, not counting time incarcerated.2eCFR. 12 CFR 303.222 – Which Offenses Qualify as Covered Offenses Under Section 19
Expunged, Sealed, and Juvenile Records
If your conviction or diversion entry has been expunged, sealed, or erased from your record by court order or by operation of law, it is not an offense of record under Section 19, and no application is required.4Federal Deposit Insurance Corporation. Your Guide to Section 19 Juvenile adjudications and youthful offender dispositions also do not count as convictions for Section 19 purposes.
Automatic Exceptions That Skip the Waiver
Even when an offense is covered, several exceptions can eliminate the need to apply for FDIC consent. The Fair Hiring in Banking Act expanded these significantly.
De Minimis Offenses
A covered offense is de minimis, meaning no waiver is needed, when all of these conditions are met: you have no more than two covered offenses total; for each offense the maximum possible sentence was three years or less of confinement or a fine of $3,500 or less; you actually served three days or less of jail time; you have completed all sentencing requirements; and the offense was not committed against a bank or credit union. With two covered offenses, both must have been entered at least three years before the date an application would otherwise be required. Only actual incarceration as punishment counts against the three-day cap. Pretrial detention, probation, parole, and outpatient treatment do not.5eCFR. 12 CFR Part 303 Subpart L – Section 19 of the Federal Deposit Insurance Act – Section 303.227
Designated Lesser Offenses
Certain low-level offenses fall outside the ban entirely once one year has passed since the conviction or program entry. These include using a fake ID, shoplifting, trespass, fare evasion, and driving with an expired license or tag.6U.S. Congress. HR 5911 – Fair Hiring in Banking Act
Older Offenses
A covered offense is excluded from Section 19 if seven years or more have passed since the offense. If you were incarcerated, the exclusion kicks in five years after your release.7Federal Deposit Insurance Corporation. Fair Hiring in Banking Act Report to Congress Once these periods elapse, no application is needed.
Offenses at Age 21 or Younger
If you committed a covered offense when you were 21 or younger, the offense is excluded 30 months after sentencing.7Federal Deposit Insurance Corporation. Fair Hiring in Banking Act Report to Congress
The 10-Year Hard Bar for Serious Federal Banking Crimes
At the other extreme, certain serious federal crimes carry a mandatory 10-year window during which the FDIC cannot grant consent under any circumstances. These include convictions under specific federal statutes for bank fraud, embezzlement of bank funds, false entries in bank records, mail or wire fraud affecting a financial institution, and money laundering.1Office of the Law Revision Counsel. 12 USC 1829 – Penalty for Unauthorized Participation by Convicted Individual The clock starts when the conviction becomes final. An application filed before the 10 years have passed will be denied regardless of rehabilitation.
How the FDIC Waiver Works
If your conviction is covered and no automatic exception applies, the route to bank employment is a formal consent application to the FDIC. You can file an individual waiver on your own, or a bank that wants to hire you can sponsor the application on your behalf.4Federal Deposit Insurance Corporation. Your Guide to Section 19 A granted waiver is specific to you and a particular role at a particular institution, not a blanket clearance for any banking job.
The main document is FDIC Form 6710/07. You will also need to contact the appropriate FDIC regional or area office for supplemental materials, including fingerprint cards, which are not available online.8Federal Deposit Insurance Corporation. Section 19 Application Instructions Submit the completed package to the regional or area office covering the state or territory where you currently live, not where the conviction happened.
Plan to gather certified court documents for your case: the charging document, plea agreement, and final judgment and sentencing order. A personal statement explaining the circumstances and evidence of rehabilitation carries real weight. Letters from employers, probation officers, or community figures who can speak to your character help. Budget for certified court record fees, which vary by jurisdiction, and fingerprinting costs.
The FDIC evaluates each application individually. Reviewers weigh the nature and severity of the offense, how much time has passed, how old you were when it occurred, and the evidence of rehabilitation. The specific duties of the position also matter. A job handling cash or with access to customer accounts will draw more scrutiny than a back-office administrative role.
Timeline and What Happens After a Decision
The FDIC’s published processing target at the regional office is 30 days for both individual and bank-sponsored applications.9Federal Deposit Insurance Corporation. General Application Processing Timeframes Individual applications require additional review at the FDIC’s Washington office after the regional stage. That 30-day clock only starts once the application is substantially complete, including background investigation data from other agencies, so an incomplete filing can add weeks or months before the clock even begins.
If the FDIC denies your application, you can request reconsideration from the appropriate Regional Director within 15 days of receiving the denial notice. The request must state the specific reasons you believe the decision should be revisited and include any relevant new information.10Federal Deposit Insurance Corporation. Section 19 Applications Procedures Manual – Requests for Reconsideration Formal appeal procedures are also available under Part 308 of the FDIC’s rules.
Credit Unions Follow a Parallel Rule
If you are looking at credit union employment rather than a bank, a similar restriction applies under Section 205(d) of the Federal Credit Union Act. It bars individuals convicted of offenses involving dishonesty or breach of trust from working at or participating in the affairs of an insured credit union without written consent from the National Credit Union Administration.11National Credit Union Administration. Fair Hiring in Banking Act Section 205(d) The NCUA’s rules are in 12 CFR Part 752 and use NCUA Form 3250. The Fair Hiring in Banking Act’s expanded exclusions apply to credit unions as well.
Why Working Around Section 19 Is Not an Option
The penalties for ignoring Section 19 are severe on both sides. Anyone who knowingly violates the prohibition can be fined up to $1,000,000 for each day the violation continues, imprisoned for up to five years, or both.1Office of the Law Revision Counsel. 12 USC 1829 – Penalty for Unauthorized Participation by Convicted Individual That reaches both the individual who takes the job without consent and the institution that knowingly permits it. Banks screen for Section 19 issues carefully during hiring, and the waiver process, though paperwork-heavy, is the only safe path in when a covered conviction is on your record.