Senators Jones, Tillis Lead New Bipartisan Bill to Promote Fair Hiring in Banking

Press Release

U.S. Senators Doug Jones (D-Ala.) and Thom Tillis (R-N.C.) today introduced bipartisan, bicameral legislation to reduce barriers to employment in the banking industry for qualified applicants with minor criminal records. Currently, otherwise highly qualified individuals with minor arrest or conviction records are prohibited from working in the banking industry because of a provision in the Federal Deposit Insurance Act, which requires financial institutions to screen out applicants with criminal records. While the law provides for waivers in some scenarios, the process is complex and arduous, and few applicants are successfully hired.

The bill is cosponsored by Senators Joe Manchin (D-W.V.) and John Cornyn (R-Texas) and companion legislation will be introduced in the House of Representatives in the coming weeks by Representatives Joyce Beatty (D-Ohio) and Anthony Gonzales (R-Ohio). The bill has been endorsed by the Alabama Appleseed Center for Law and Justice, the National Bankers Association, and the Bank Policy Institute.

The Fair Hiring in Banking Act would replace the lifetime ban on working in the banking sector with a more sensible waiting period for individuals who have minor criminal records. It would allow applicants to be eligible for employment so long as they met all sentencing requirements for at least seven years. It would also create an exception for criminal conduct that was committed before age 21 and at least 30 months prior to employment, as well as ensure that expunged records, pardons, and sealed convictions are no longer a barrier to employment.

"After folks have paid their time, they should be able to contribute to their communities and care for their families. Our bill will help remove barriers to employment in the banking industry for applicants who have met their sentencing requirements without increasing any risk to the safety and soundness of the hiring organization," said Senator Jones, a member of the Senate Banking, Housing and Urban Affairs Committee.

"It's critical that we continue to find ways to help reintegrate people with minor, non-violent criminal records who have shown they will be productive, law-abiding citizens," said Senator Tillis, a member of the Senate Banking, Housing and Urban Affairs Committee. "I am proud to co-introduce this bipartisan legislation that builds on our work to reform the criminal justice system and gives people who served their time a second chance to work in the banking industry."

"Over and over again, we have witnessed doors slammed shut and opportunities removed for justice-involved people, yet we expect them to go forth and prosper after incarceration. The Fair Hiring in Banking Act is a common sense step toward recognizing that people who have worked to overcome past mistakes deserve second chances. We wholeheartedly support this legislation," said Carla Crowder, Executive Director, Alabama Appleseed Center for Law and Justice.

"We commend Senator Jones for his leadership on this important issue. Giving financial institutions more flexibility in who they are able to hire will expand the pool of available talent for the next generation for our institutions, and indirectly, the bill will also help to diversify the entry points into our industry. The National Bankers Association enthusiastically supports the Fair Hiring in Banking Act and looks forward to its final passage," said Kenneth Kelly, a Eufaula, Alabama native who serves as the President and CEO of First Independence Bank and Chairman of the Board of Directors for the National Bankers Association, the leading organization of minority-owned banks.

"We see real opportunity in what the Fair Hiring in Banking Act would create for our bank in terms of giving us flexibility in who we can hire from the communities we serve. Senator Jones has rightly identified the unnecessary barriers to hiring that exist for many of our banks, and doing away with those barriers is the right thing to do," said Patrick Cooper, the Mobile, Alabama-based Chairman of the Board of Directors of Commonwealth National Bank, one of only 16 remaining African-American-owned banks in the country.

The Fair Hiring in Banking Act will:

Replace the lifetime ban with a seven-year waiting period: Under current law, an individual's criminal conviction can block them from the industry for life. The Federal Deposit Insurance Corporation (FDIC), which regulates federally insured financial institutions, does not have the authority to create a time limit. Under this bill, the FDIC barrier will no longer apply to convictions for which all sentencing requirements have been met for at least seven years, in line with other regulatory authorities.
Create an exception for acts committed before age 21: If the criminal conduct was committed before age 21--and at least 30 months prior to employment--and all sentencing requirements were met, the applicant will not be required to obtain a waiver from the FDIC.
Ensure that expunged records, pardons, and sealed convictions are no longer a barrier to employment: Current FDIC rules don't align well with state laws, so a hiring barrier can still exist even if a conviction was sealed, expunged, or pardoned. This bill clarifies the law so that individuals with a criminal record that is expunged, sealed or pardoned will no longer need to seek an FDIC waiver before securing employment.