FDIC Announces Electronic Fingerprinting Requirement for Background Checks Conducted in Conjunction with Applications and Notices

On April 17, 2018, the FDIC issued a Financial Institution Letter (FIL-21-2018), in which it announced that it will now require electronic fingerprinting in order to conduct more efficient and effective background checks when reviewing various applications and notices for FDIC-insured and proposed insured depository institutions.  The FDIC will institute its new fingerprinting process during the second quarter of 2018.

The FDIC currently requires fingerprints from various parties (e.g., certain proposed directors, officers, and shareholders of depository institutions applying for federal deposit insurance) for background investigation purposes in conjunction with its review of particular submitted applications and notices, including, for example, federal deposit insurance applications, control acquisition notices, requests for banking industry participation by individuals that have certain criminal convictions, and replacement notices for board members or senior management in certain institutions.  Under the new requirement, those fingerprints must be captured electronically.  Parties for whom the FDIC requires fingerprinting may have their prints captured at over 1,000 locations spread throughout all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.  These prints will be submitted to the FBI for a fingerprint identification check, the results of which will be reported back to the FDIC.  The FDIC instituted this change in hopes that electronic print capture technology will decrease the prevalence of poor-quality fingerprint samples.