Better Markets filed a Comment Letter to the Federal Deposit Insurance Corporation (FDIC) on conforming with the Fair Hiring in Banking Act (FHBA).

Why It Matters. The law generally prohibits people who have been convicted of certain crimes from being employed by FDIC-insured banks, even for small, minor, or long-ago offenses. This prohibition disproportionately impacts communities of color given their disproportionate representation among those convicted. In implementing the Fair Hiring in Banking Act (FHBA), the FDIC’s proposal will open up jobs in the banking industry for individuals who have committed minor crimes that do not endanger public trust and who have fully paid their debt to society.

What We Said. While there is still a long way to go, the proposal marks a step toward more equality in the treatment of lower-level bank employees relative to high-powered bank executives. Lower-level applicants and employees face employment barriers due to minor offenses, while many bank executives remain employed in positions of power despite taking part in large-scale consumer abuses, money laundering, and other serious financial crimes. The executives get bonuses and hardworking, qualified Americans get barred from jobs.  That double standard is indefensible, and this proposal at least addresses one part of that.

Bottom Line. In addition to implementing the FHBA, the FDIC and other regulators must increase the accountability and punishment of bank executives who are responsible for major lawbreaking, including criminal offenses, at Wall Street megabanks.  As Better Markets has made clear in numerous reports, that repeated lawbreaking inflicts widespread harm on consumers and endangers financial stability.  It is really good news that the FHBA will increase fairness on the streets, but that should be matched by accountability in the suites.

You can find the full letter here.