What Is an OCC Consent Order and What Does It Require?

An OCC consent order is a binding enforcement directive the Office of the Comptroller of the Currency issues to a national bank or federal savings association that has agreed, without a contested hearing, to fix specific violations or unsafe practices the agency has identified. The bank accepts the charges, the OCC spells out exactly what must change, and the order stays in force until the agency independently verifies that every requirement has been met. Along the way, the order can carry multimillion-dollar penalties, restrict how the bank operates, and reach individual officers and directors.

Why It’s Called a “Consent” Order

“Consent order” isn’t a separate category on the OCC’s enforcement list. In practice, it’s a cease and desist order that the bank has agreed to voluntarily rather than fight.

The mechanics come from 12 U.S.C. § 1818(b). When the OCC identifies serious problems, it can serve the bank with a notice of charges and schedule a hearing 30 to 60 days later. If the bank doesn’t appear or agrees to the charges, the statute says it “shall be deemed to have consented to the issuance of the cease-and-desist order.” A contested order doesn’t take effect for 30 days; a consent order becomes effective immediately at the time specified in the agreement.¹

Banks almost always consent. A contested hearing is public and expensive, and the bank risks a harsher outcome. Consenting keeps the process out of open litigation and gives the bank some input into the remediation timeline, though not into the substance.

The OCC’s other enforcement tools sit at different levels. Formal agreements are bilateral contracts signed by the OCC and the bank’s board, typically used for less severe concerns. Cease and desist orders imposed after a contested hearing represent the most adversarial option. Civil money penalty orders can accompany either type and require a specific dollar payment.²

Why the OCC Issues a Consent Order

The two triggers that show up most often are violations of specific laws and what regulators call “unsafe or unsound practices.” Bank Secrecy Act and anti-money laundering failures have dominated in recent years. The OCC’s 2024 consent order against TD Bank cited the bank for pursuing growth without building an adequate compliance program, resulting in deficiencies across internal controls, risk assessments, customer due diligence, suspicious activity reporting, staffing, and training.³

Failing to fix a problem the OCC has already flagged is another fast route to formal action. A separate 2024 consent order cited a bank for failing to make acceptable progress toward correcting customer due diligence deficiencies the OCC had previously identified, which triggered additional authority under 12 U.S.C. § 1818(s)(3).⁴

What the Order Requires the Bank to Do

Every consent order is tailored to the violations at issue, but the same categories of requirements appear again and again. The bank has to overhaul the policies and internal controls that failed, strengthen its risk management, and often restructure the teams responsible for compliance. Orders frequently require the bank to develop a detailed action plan within a set number of days and submit it to the OCC for approval before implementation begins.

A Board Compliance Committee

Most orders require the bank’s board to appoint a compliance committee, usually within 15 days. The TD Bank order required a committee of at least three board members, a majority of whom could not be employees or officers of the bank or its affiliates. The committee has to meet at least quarterly and keep detailed minutes of its oversight work.³

An Independent Consultant at the Bank’s Expense

For serious violations, the OCC can require the bank to hire an outside independent consultant at its own expense. The agency uses this tool specifically when it finds significant legal violations, fraud, or consumer harm. Common assignments include reviewing whether the bank needs to file or correct suspicious activity reports, assessing compliance with consumer protection laws, evaluating whether restitution is owed to customers, and conducting forensic audits where widespread irregularities are suspected.⁵ These engagements can cost millions and run for years.

Regular Progress Reports

Banks under consent orders have to submit written progress reports describing the corrective actions taken, the results and status of those actions, and what remains to be done, with responsible parties and timelines. Under the TD Bank order, these reports were due quarterly and had to reach the OCC’s examiner-in-charge within ten days of the board receiving them.³ Some orders also require quarterly attestations from senior executives confirming compliance with specific provisions.

Penalties and Business Restrictions

The OCC frequently pairs a consent order with a separate civil money penalty order. Federal law sets three tiers of penalties, and the amounts accumulate for each day a violation continues.

First tier: up to $5,000 per day for any violation of a law, regulation, final order, or written agreement.
Second tier: up to $25,000 per day when the violation is part of a pattern, causes more than a minimal loss, or produces a benefit for the responsible party.
Third tier: up to $1,000,000 per day for individuals, or the lesser of $1,000,000 per day or 1% of the institution’s total assets, when someone knowingly commits a violation and knowingly or recklessly causes a substantial loss.

These statutory base amounts are adjusted upward annually for inflation.⁶ Because the meter runs daily, totals can be enormous. The OCC’s 2024 penalty against TD Bank reached $450 million, reflecting violations that persisted across years.⁷

A consent order can also limit what the bank is allowed to do. Some orders explicitly restrict new products, acquisitions, or expansion into new markets. Even when the order itself is silent on business activities, a bank under a formal enforcement action can lose its status as an “eligible bank” under OCC rules, which triggers additional regulatory limitations automatically.⁸

Executive compensation gets tighter too. Federal regulations prohibit banks in “troubled condition” from making golden parachute payments, meaning severance triggered by an executive’s departure. The same rules bar the bank from reimbursing executives for civil money penalties or legal costs arising from federal enforcement proceedings.⁹

What Happens If the Bank Doesn’t Comply

Ignoring or slow-walking a consent order makes things worse. The OCC treats a violation of an existing order as an independent basis for further enforcement under 12 U.S.C. § 1818(i), which means daily civil money penalties start accumulating on top of whatever the bank already owes.⁶ The agency can also issue additional safety and soundness orders requiring further corrective actions until the problem is resolved.²

Enforcement can reach individuals as well. The OCC has authority over “institution-affiliated parties,” a category that includes directors, officers, employees, and controlling shareholders. Individuals can face personal cease and desist orders, removal from their positions, and personal civil money penalties.²

How and When a Consent Order Ends

A consent order has no expiration date. It stays in effect until the OCC decides to terminate it. According to the agency, termination happens when one of three conditions is met: the bank has demonstrated compliance with every provision, the OCC decides any remaining non-compliant provisions have become outdated or irrelevant to the bank’s current situation, or the OCC folds the outstanding requirements into a new enforcement action.¹⁰

The first outcome takes longer than most banks expect. The OCC doesn’t accept the bank’s word that it has fixed the problems. The TD Bank order made this explicit: the bank would not be considered in compliance until it had adopted, implemented, and adhered to all corrective actions, the actions were effective, and the OCC had independently verified and validated them. The order added that “an assessment of the effectiveness of the corrective actions requires sufficient passage of time for the Bank to demonstrate the sustained effectiveness of the corrective actions.”³ Some banks operate under consent orders for five years or more.

What It Means If You Bank There

If your bank is operating under a consent order, your deposits remain protected by FDIC insurance up to the standard coverage limits. A consent order is a supervisory action aimed at fixing the bank’s internal operations. It is not a sign that the bank is about to fail, and your accounts, loans, and everyday banking should continue to function normally.

That said, the order signals that the OCC found problems serious enough to warrant formal action, which means the bank’s risk management or compliance systems were inadequate. Depending on the violations, customers can be directly affected. BSA/AML failures sometimes reveal that the bank wasn’t properly monitoring transactions for fraud. Consumer protection violations may mean certain fees were improperly charged or disclosures were missing. In those situations, the consent order often requires the bank to identify affected customers and provide restitution.

Reading the Order Yourself

All OCC consent orders are public. The agency maintains a searchable database of formal enforcement actions where anyone can look up current and past orders by institution name.¹¹ Orders that aren’t posted online can be requested through the OCC’s Freedom of Information Act process.¹² If your bank is involved, the document itself is worth reading. It lays out exactly what the OCC found and what the bank must do about it, in far more detail than any press release or news account will provide.

1
Office of the Law Revision Counsel. 12 USC 1818 – Termination of Status as Insured Depository Institution
2
Office of the Comptroller of the Currency. Enforcement Action Types
3
Office of the Comptroller of the Currency. Consent Order – TD Bank N.A.
4
Office of the Comptroller of the Currency. Consent Order AA-ENF-2024-56
5
Office of the Comptroller of the Currency. Use and Review of Independent Consultants in Enforcement Actions: Guidance for Bankers
6
Office of the Law Revision Counsel. 12 US Code 1818 – Termination of Status as Insured Depository Institution
7
Office of the Comptroller of the Currency. Civil Money Penalty – TD Bank N.A. and TD Bank USA N.A.
8
Office of the Comptroller of the Currency. Statement Regarding Revocation of Relief to Wells Fargo Bank N.A.
9
eCFR. 12 CFR Part 359 – Golden Parachute and Indemnification Payments
10
Office of the Comptroller of the Currency. OCC Announces Enforcement Actions for March 2026
11
Office of the Comptroller of the Currency. Enforcement Actions Search
12
Office of the Comptroller of the Currency. Enforcement Actions