MAR---06---2009 16^:^50 FDIC 679 916 2453 P.02

**OMB No.: 3064.0018**

**Federal Deposit Insurance Corporation Expiration Date: 7/31/2000
CORPORATION [GUIDELINES]{.underline} AND **POLICIES WITH **RESPECT **TO
SECTION 19

***public *reporting burden for this collection 01 information is
estimated to average *16 *hours per response, including the time (or
reviewing instructions, searching existing data sources. gathering and
maintaining the data needed, and completing and reviewing me collection
of Information. Send comments regarding this burden estimate or any
other aspect of this collection *of *information, including suggestions
for reducing this burden, to the Assistant Executive Secretary
(Administration), Room e09e, FDIC, Washington. DC 20429; and to the
Office of Management and Budget. Paperwork Reduction Project
(3064-0018). washingten. *DC *20503.**

On **September **27, **1968, **the **Federal **Deposit Insurance
**Corporation\'s **Chairman addressed the following memorandum to all
insured banks.

\"The **Federal **Deposit Insurance **Corporation **has for some time
been studying in detail Section 19 of the Federal Deposit Insurance Act
(12 U.S.C. 1829), relating to the requirement for this **Corporation\'s
**consent prior to any insured bank employing persons who have been
convicted of crimes involving dishonesty or breach of trust.

\"Section 19 provides 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 **convicted **of **any *criminal
****offense **involving dishonesty ****or ****breach of ****trust. *For
each willful violation of this prohibition, the bank involved shall be
subject to a penalty of not more than \$100 for each **da**^y^** **this
**prohibition **is violated, which the **Corporation **may recover
^for\ ^its use.^\'^

\"Since the enactment of this law in 1950, our Board has reviewed cases
coming under it on an ad hoc basis and each case has been judged on its
own merits according to the particular facts and circumstances involved.
The need for guidelines and standards to be applied **prospectively
**has increased in recent years, Inquiries continue to come in from
banking institutions asking what standards should be applied by them in
determining whether an application under Section 19 is required. In
addition, programs are now underway on both the **Federal **and state
levels to hire and retrain the hardcore unemployed. some of whom may
have criminal records, and the banking community will no doubt
participate in^.^these programs to some degree. For these reasons, the
Board of Directors has adopted the following general **guidelines **and
policies with respect to Section 19. It is our hope that these
guidelines will be of assistance to all banks having questions
concerning the **applicability **of our law, and that they will, at the
same time, serve to insure the continuing stability and confidence in
our banking system.\"

I, **STANDARDS TO BE APPLIED **IN **DETERMINING WHETHER **AN
**APPLICATION FOR CONSENT IS REQUIRED UNDER SECTION **19

A. There must **be **present ***a **conviction of record. ***Arrests,
**pending **cases not brought to trial, acquittals, or any conviction
which has been **reversed **on **appeal **will be excluded from the
requirements of Section 19. A conviction which is being appealed will
require a, Section 19 **application **until or unless otherwise
reversed.

B. The conviction must **be **for *a ****criminal offense involving
dishonesty **or **breach of ****trust. *Felonies **as **well **as
misdemeanors **wherein **dishonesty **or breach of trust is involved are
**included **within the definition. Dishonesty is defined to mean \"to
cheat or defraud for monetary gain or its equivalent, directly. or
indirectly, or to wrongfully take from any person, property lawfully
belonging to that person in violation of any criminal statute or code.\"
(Acts of dishonesty are further defined to include, but not limited to,
such acts which involve want of integrity, lack of probity, or involve a
disposition to distort, defraud. cheat or to act deceitfully or
fraudulently. Furthermore, dishonesty may also include crimes which by
federal or state criminal statutes and codes are defined as dishonest.\]
Breach **of **trust is **defined to mean \"a **wrongful use,
**misappropriation, or **omission with respect to any property or fund
which has been lawfully committed to a person in a fiduciary capacity.\"

C. Youth Offenders

1\. Adjudgment by a court against a person *as *a \"youthful offender\"
under any youth offender law or adjudgement as a \"juvenile delinquent\"
by a family court or any other court having jurisdiction over minors as
defined by state law will not require an **application **under Section
19. Such adjudications are not considered convictions for criminal
offenses.

D.. Adults and All Minors **Convicted **of Crimes

*1. *The **conviction **of any adult or minor by a court of competent
jurisdiction for any criminal offense involving dis­honesty or breach of
trust as defined in **paragraph **B above will require an application
for consent prior to a bank^\'^s **employment **of that **person.**

II\. **THE CORPORATION\'S POLICY **WITH **RESPECT **TO **APPLICATIONS
**MADE **UNDER SECTION **19

A. In considering any **application **made by an insured bank to employ
a person who has been convicted of a criminal offense in^.^ volving
dishonesty or breach of trust, the factors to be considered will include
but will not be limited to the following: 1. The specific nature of the
offense involved and me circumstances surrounding it.

2, The **evidence **of **rehabilitation **of the person since the date
of his/her conviction (parole. suspension of sentence, and reputation of
the person since conviction will **be given consideration. Participation
by **the **person **in **programs ***on *the national or state levels to
hire and retrain the hard---core unemployed also will be given
consideration,

3\. The age of the person at the time of his/her conviction.

4\. The **position to be held by **the **person **in the bank.

5\. The fidelity **bond coverage applicable (or to be applicable) to
**the person\'

**CORPORATION STATEMENT OF POLICY**

The Board of Directors of the Federal Deposit Insurance Corporation
approved the following statement of policy at its offices in Washington,
D.G., on the 21st **day **of September, 1976:

The **Corporation **does not view Section 19 as being punitive in
intent. Rather, the essential criterion in assessing such applications
is whether the prospective director, officer, *or *employee constitutes
a significant threat or risk to the safety and soundness of the appli•
**cant bank, **and our policy is **to approve applications ***in *which
this risk is absent.

Existing **Corporation **policy on Section 19 **applications **has
involved consideration of the nature and circumstances of the **offense,
**the **evidence **of **rehabilitation, the position to be **held **by
**the **employee **in the bank and the applicability of the bank\'s
fidelity bond coverage to the **employee. **These remain important
considerations in determining the risk to the bank in the emoiovment of
the prospec­tive **employee.**

On this basis, many applications can be routinely **approved **because
the prospective employee will not be in a position to constitute any
substantial risk to the safety and soundness of the bank. Employees who
will occupy clerical, maintenance, or service positions or, in many
banks, **administrative **or teller positions generally **pose no **such
risk, and on **application **from the board of directors of the bank,
normally will **be able **to **be routinely approved. **A **more
detailed analysis **will **be required **in **the case of **directors,
**officers, or ***other ein\' em*ployees *in *position to **control
***or ***influence the *disposition *of **sums ***of money ***large in
relation *to the size of the bank,*

root. *8710/07 (e^.^****O,: Mee. Gee)***

MAR---06---2008 16 50 FDIC 679 916 2453 P.03

**FEDERAL DEPOSIT INSURANCE CORPORATION**

**APPLICATION PURSUANT **TO SECTION 19 OF THE FEDERAL DEPOSIT INSURANCE
ACT

**SECTION A A^.^ APPLICANT BANK INFORMATION**

**NAME OF BANK f 2, DATE OF APPLICATION**

**3.. ADDRESS OF BANK */Street, ****City. County, *State ***and ZIP
*Code)**

We *have, *in connection with this Request, *read *the following
provision of the Federal Deposit Insurance Act which governs requests by
insured banks for the consent of the **Federal **Deposit Insurance
Corporation to the employment, by the Bank, *of *a person who has been
convicted of a crime involving dishonesty ***or *breach of trust,
namely:**

^\"^*Section *79. Except with *the written *consent *Of the Corporation,
no *person *shall serve as a director, officer, or employee of en
insured bank ***who *has been convicted, or who ****is *hereinafter
*convicted, of any criminal offense involving dishonesty or a breach *of
trust. *For ****each ****willful ****violation ***of ***this
prohibition, the **bank **involved** shall be subject to ****a penalty
of nor more than *3\'100 *^for\ ^****each date ****this ****prohibition
is ****violated, . ****which the Corporation ****may *recover *for its
*use.^\"^

In **support of this Request, **the **following statements,
representations **and information are submitted for the **purpose **of
inducing the Federal Deposit Insurance Corporation to grant its written
consent to the service as a director, officer, or employee of the bank,
a person who has been *convicted *of a crime involving dishonesty or a
breach of trust:

**SECTION B **• **BIOGRAPHICAL INFORMATION CONCERNING THE PROSPECTIVE
DIRECTOR. OFFICER. OR EMPLOYEE**

1\. NAME 2. ADDRESS */Street, City, Stare and ZIP Code)*

3\. DATE OF **BIRTH (Mo Day Yr***)*

**d. PLACE OF BIRTH (City and State)**

**S, SOCIAL SECURITY NUMBER**

**6. NAME AND ADDRESS OF PRESENT OR MOST RECENT EMPLOYER *(Street,
***City, State *and ZIP code)*

**7, INDICATE TOTAL NUMBER OF VOTING SHARES OF THE BANK\'S STOCK
DIRECTLY OR INDIRECTLY OWNED OR OTHERWISE CONTROL. LEO. *(Answer
*\"none\" ***if appropriate. )*

**SECTION C • INFORMATION RELATIVE TO CONVICTIONISI**

+----------------+----------------+----------------+----------------+
| **1.           | **DATE OF      | **NAME ANO     | *              |
| DESCRIPTION OR | CONVICTION**   | ADDRESS        | *DISPOSITION** |
| NATURE OF      |                | ^OF\ ^COURT**  |                |
| CRIME**        | **Ibl**        |                | **(dl**        |
|                |                | *(cl*          |                |
| **(al**        |                |                |                |
+----------------+----------------+----------------+----------------+
|                |                |                |                |
+----------------+----------------+----------------+----------------+
|                |                |                |                |
+----------------+----------------+----------------+----------------+
|                |                |                |                |
+----------------+----------------+----------------+----------------+

***NOTE: **//additional convictions for crimes involving ****dishonesty
or breach of trust am discovered subsequent*^.^* co approval of this
*\'moues:, *another *request *may *be *necessary.*

2\. Briefly describe the nature of the offense and the circumstances
surrounding it. Include age of prospective employee at the time of
conviction, date of the , offense, and any mitigating circumstances
*(parole, suspension of sentence, *pardon, *etc./.*

3, Briefly **describe **the extent of rehabilitation of the prospective
director. officer, or em^p^loyee ^ar^id^\ ^attach **supporting
**documents, if any. **FDIC 8710107 (Paoe Two)**

4\. Attach **geoid **of the Indictment, Information. or Complaint and
Final Decree of Judgment, if available. *(Normally these can be obtained
from the clerk of the court: If ****not provided, explain reasons
****for ****unaeailabilrtyl.***

**5. List any other pertinent **facts relative to the crime which are
not disclosed in the indictment.

I do hereby certify that the **Biographical **Information (Section BI
and Information Relative to Conviction (Section CI are true and correct
to the best of my knowledge and belief.

**SIGNATURE OF PROSPECTIVE DIRECTOR, OFFICER OR EMPLOYEE DATE SIGNED**

NOTE: The information requested in Sections B and C above, including the
Social Security Number of the prospective director, officer or employee,
is solicited pursuant to Section 19 of the Federal Deposit Insurance Act
(12 U.S.C. §18291. This information is necessary to assist the FDIC in,
assessing the merits of the application. Some of the information,
including the Social Security Number. may be provided to any appropriate
Federal or State bank regulatory agency and. law enforcement or other
governmental agencies for identity verification purposes. Should the
information indicate a violation of law, the application may be referred
to any agency responsible for investigating or prosecuting such a
violation. In addition, in the event of litigation, the application may
be presented to the appropriate court as evidence and to counsel in the
course of discovery. While submission of the information is voluntary,
an omission or inaccuracy may result either in delay in processing the
application or in a denial of the application. Falsification of any of
the information may serve as a basis for removal of the director.
officer or employee if employed by the bank and as grounds for criminal
charges.

**SECTION D - POSITION TO BE OCCUPIED BY THE PROSPECTIVE DIRECTOR,
OFFICER OR EMPLOYEE**

1\. TITLE OF **POSITION **(SI

2\. Describe the duties and **responsibilities **^of\ ^the prospective
director, officer or employee. Include extent of supervision exercised
over others and/or by others,

***NOTE: *Should this *request be approved, any significant change
****in *the *duties and/or r^e^sponsibilities of the prospective
director, Officer or employee which meets within ****12 months
subseouent to such approval must be reported **in **writing *to the
*Regional Director ****of the ****Federal Deposit ****Insurance
Corporation Region ****in) **which the **bank ****^is\ ^located.*

**[SECTION]{.underline} [E]{.underline} [-NOTIFICATION]{.underline}
[OF]{.underline} [FIDELITY INSURER]{.underline}**

**\_**

The bank\'s fidelity insurer is to be notified of all pertinent
information regarding the conviction of the prospective employee.
Assurances *from *the fidelity insurer must be obtained, in writing,
stating that the prospective director (if applicable), \*Picon, or
employee will be covered by the bank^\'^s fidelity bond. This
application and the information requested herein may be submitted prior
to notification of the bonding company: however, the Corporation^\'^s
consent will be subject to a condition that written assurance of
fidelity coverage to the same extent as others in similar positions be
obtained by the bank.

**SECTION F • ADDITIONAL INFORMATION IN SUPPORT OF THIS REQUEST**

**List any other appropriate information,**

I do hereby~,~ certify that the Board of Directors adopted a resolution
which delegated the undersigned the authority to make applications
pursuant to Section 19 of the Federal Deposit Insurance Act or has
adopted a resolution authorizing this applica• lion pursuant to Section
19 of the Federal Deposit Insurance Act.

**SIGNATURE OF BANK OFFICIAL**

**This is an official document of the Federal Deposit Insurance
Corporation. Providing false information may be grounds for prosecution
under the provisions of Tide 1B, Section 1001 ot 1007 of the United
States Code and may be punishable by fine or imprisonment.**

**FDIC 8710107 (Page Three)**

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