Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra recently expressed his support for a proposed rule that revises the lifetime banking ban for individuals convicted of certain criminal offenses. The Federal Deposit Insurance Act currently prohibits banks from employing people convicted of specific crimes, such as drug possession. The proposed changes will exclude some offenses from this prohibition.
Chopra particularly backed the provision that reduces lifetime bans for individuals who were 21 years old or younger at the time of their offense. He believes this change will create more employment opportunities and allow banks to recruit qualified individuals.
Chopra noted the irony in the existing policy, which imposes lifetime bans on low-level employees while rarely holding top executives accountable for consumer abuses, money laundering, and other financial crimes committed under their watch. He stated, “There’s been a number of top executives at large banks who have repeatedly presided over consumer abuses, money laundering, and other financial crimes, and the only accountability we usually seek is to make the bank pay a fine.”
The CFPB Director views the proposed rule as a small step towards achieving a better balance in the banking sector. However, he also emphasized the need for further actions to hold executives responsible when their banks engage in repeat offenses.
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