Seal of the Board of Governors of the Federal Reserve System
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C.  20551
DIVISION OF BANKING
SUPERVISION AND REGULATION
SR 03-10
May 28, 2003

TO THE OFFICER IN CHARGE OF SUPERVISION
AT EACH FEDERAL RESERVE BANK
SUBJECT:  Enhancement to the Name Check Process Related to Applications Reviewed by the Federal Reserve

In connection with its review of various applications and notices, the Federal Reserve has had a longstanding policy of conducting name checks with law enforcement and other government authorities on certain individuals associated with a proposed transaction.  Name checks have generally been performed on significant shareholders and key policymakers who are not well known to U.S. bank or thrift regulators, and in special circumstances particular to some applications. These checks enable the collection of information about individuals that may be useful in the Federal Reserve's review of the financial resources, experience, integrity, and competence of persons associated with a banking organization, as well as in the Federal Reserve's assessment of whether the individuals can lead the organization in a safe and sound manner.

The Federal Reserve has worked with the Federal Bureau of Investigation on an enhancement to the System's current name check process that will enable the Federal Reserve to obtain from the FBI more accurate and current information relating to arrests and convictions. This new process necessitates the use of fingerprints from individuals who are subject to name checks in the applications process. The use of fingerprinting as a security measure has become significantly more widespread and accepted, and advances in fingerprinting technology have been made with respect to the speed with which such checks can be completed.

There are currently two methods by which fingerprints can be provided to the Federal Reserve – a "Live-Scan" terminal or a fingerprint card. A Live-Scan terminal allows fingerprints to be obtained in digital format and sent to the FBI electronically. Eight of the 12 Reserve Banks currently have Live-Scan capability, and individuals can choose to visit one of these Reserve Banks to submit their fingerprints.1 The second method of submitting fingerprints is through fingerprint cards, which are completed manually at various law enforcement locations and sent via mail for processing. If it is not convenient to visit a Reserve Bank to use a Live-Scan terminal, an individual will be requested to complete a fingerprint card. The completed card will be sealed by law enforcement in an envelope supplied by the Reserve Bank and mailed to the address that is pre-printed on the envelope. The attached Letter of Instruction for Applicants provides more detailed information on the submission of fingerprints.

The new fingerprint requirement has not changed the Federal Reserve's overall process for determining whether an individual will be subject to name checks for a particular filing. During the applications process, Reserve Banks will identify persons who need to be fingerprinted, and send to such persons blank fingerprint cards and return envelopes, as well as the attached Letter of Instruction. To meet all relevant processing timeframes and avoid delay, it will be necessary for fingerprints to be submitted as expeditiously as possible (either through Live-Scan or mail). The use of a Live-Scan terminal, where available, will significantly expedite the name check process.

To the extent possible, the fingerprint process should commence prior to submission of an application or notice. Such an approach requires early consultation with Reserve Bank staff by relevant parties, the submission of Interagency Biographical and Financial Reports on a pre-filing basis, and the prompt identification by Reserve Banks of persons that require fingerprints.2 Reserve Banks should emphasize to the affected individuals and applicants that failure to expeditiously complete the fingerprinting process could result in a delay on the related application.

All applications received after June 30, 2003 are subject to the new procedure.3 Fingerprint cards or Live-Scan fingerprints must be obtained on each relevant person meeting the name check criteria associated with an application or notice received after June 30.

Reserve Banks are asked to distribute this SR letter to staff involved in the applications process and to other supervisory staff. Questions regarding the use of fingerprints may be directed to Len Zawistowski, Senior Special Investigator, at (202) 452-6488, or David Reilly, Senior Supervisory Financial Analyst, at (202) 452-5214.

Herbert A. Biern
Senior Associate Director


Attachment:
Letter of Instruction for Applicants (81 KB PDF)

Notes:
  1. The Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Atlanta, Chicago, Minneapolis, and San Francisco currently have Live-Scan terminals. The remaining four Reserve Banks expect to have Live-Scan terminals in the near future. Individuals can only use Live-Scan terminals at the Reserve Banks.  Return to text
  2. Once Federal Reserve staff determines that an individual should be subject to fingerprinting, the requirement may not be eliminated or satisfied by the fact that the individual may have previously submitted fingerprints to another government agency.  Return to text
  3. Certain foreign individuals associated with foreign bank applications may not be required to provide fingerprints under the new procedure. Applicants or their counsel should consult with the responsible Reserve Bank on these matters.  Return to text
SR letters | 2003
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