FDIC Updates Waiver Requirements

FDIC Updated Waiver Requirement

At Lifeback Legal, we strive to do our best to give our client the most accurate and up-to-date information available. In August of 2018, the Federal Deposit Insurance Corporation (FDIC), released a new Statement of Policy (SOP) that clarifies and updated the waiver requirement under Section 19 of the Federal Deposit Insurance Act (FDIA – 12 U.S Code § 1829) for Section 19 waivers.

Lifeback Legal is a division of the Law firm of Shea M. Randall. Our law firm has become one of the leading providers of Section 19 waivers and since Section 19 Waivers are an area of federal administrative law, we accept cases throughout the country. So whether you’re in California or Texas, we can help. We also expedite your application to the FDIC.

With that being said, how has the FDIC updated the waiver requirement?

Prior to the recent Statement of Policy, anyone who did not meet the de minimis requirement was required to obtain a Section 19 FDIC waiver – with the de minimis waiver defined as follows:

    1. There is only one conviction or program entry for a covered offense;
    2. The offense was punishable by imprisonment for a term of one year or less and/or a fine of $2,500 or less, and the individual served three (3) days or less of actual jail time;
    3. The conviction or program was entered at least five years prior to the date an application would otherwise be required; and
    4. The offense did not involve an insured depository institution or insured credit union.

In order to meet this criteria, all four prongs of the standard must be met. The difficulty with this standard, however, is that some states may prosecute certain minor crimes more harshly than others, thus making it more difficult some individuals to meet prong two.

Now, however, the FDIC has updated waiver requirement with three newly carved out exceptions:

Convictions or program entries for small-dollar, simple theft

As long as there is no other conviction or program entry under Section 19, it’s  been five years since the conviction or program entry, and the offense does not involve an insured financial institution or insured credit union, then a conviction or program entry based on a simple theft of goods, services and/or currency (or other monetary instrument) where the aggregate value of the currency, goods and/or services taken was $500 or less at the time of conviction or program entry,  then it will be considered de minimis. This does not include theft crimes involving burglary, forgery, robbery, identity theft, or fraud.

Convictions or program entries for the use of a fake, false or altered identification card

As long as there is no other conviction or program entry subject to Section 19, the use of a fake, false, or altered identification card used by person under the legal age for the purpose of obtaining or purchasing alcohol, or used for the purpose of entering a premise where alcohol is served but for which age appropriate identification is required, will be considered de minimis.

Convictions or program entries for insufficient funds checks

As long as there is no other conviction or program entry subject to Section 19, then a conviction or program entry based on the writing of “bad” or “insufficient funds” check shall be considered a de minimis offense under and will not be considered as having involved an insured depository institution if the following applies:

  • There is no other conviction or program entry subject to Section 19, and the aggregate total face value of all “bad” or “insufficient funds” check(s) cited across all the conviction(s) or program entry(ies) for bad or insufficient funds checks is $1,000 or less; and
  • No insured depository institution or insured credit union was a payee on any of the “bad” or “insufficient funds” checks that were the basis of the conviction(s) or program entry(ies).

Age at time of covered offense

Finally, in something that will likely help University students, the FDIC has modified prong three. Where before there was a requirement to wait at least five years to obtain a de minimis waiver, if someone meets all of the other prongs of the test except prong three and they were 21 years or younger when the offense occurred, they may now only wait 30 months or three and a half years to have their offense considered de minimis.

If you or someone you know is concerned that they may have a Section 19 waiver issue, please contact our office to speak with one of our attorneys. We are experienced FDIC waiver attorneys and can help assess their situation. Learn more about the FDIC Section 19 Waiver requirement here, or sign-up online today for an FDIC Section 19 case analysis.

Contact one of our FDIC waiver attorneys today at (888) 751-5329 or by using the contact us form below.

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