- What's at Stake: The Fed issues prohibition orders against individuals convicted of crimes to ensure they do not work again in the banking industry.
- Key Insight: The employees were found to have illegally accessed customer information and embezzled from a bank customer, respectively.
- Forward Look: The individuals were caught and no longer work at their respective banks.
Two former bank employees at two different banks have been kicked out of the banking industry for breaking the law and engaging in "personal dishonesty," for misappropriating customer data and stealing money from a customer's bank account, the Federal Reserve Board said.
On Thursday, the Federal Reserve released consent orders prohibiting the former bank employees — Rahimlen Dean, a former teller at $210 billion-asset M&T Bank, in Buffalo, New York, and Jerman McGlown, a former wire transfer administrator at $82.1 billion-asset First Horizon, in Memphis — from working in any capacity in the industry.
Both former bank employees were convicted of a crime, which prompts the Fed to issue a so-called Section 19 letter advising the individual that they have been prohibited from the banking industry due to a conviction "or other criminal disposition with respect to certain categories of crimes." Such letters are issued by the Federal Reserve Bank on behalf of the Federal Deposit Insurance Corp., under Section 19 of the Federal Deposit Insurance Act, and require the individual to obtain a waiver from the FDIC before participating in the banking industry.
In May 2023, Dean accessed a customer's bank account and stole $5,239.79 to pay down her own credit card balance, according to the Fed's
Meanwhile, McGlown, the former wire transfer administrator at First Horizon, used his position to obtain confidential customer information, which he then gave to a third party, who used the information to impersonate customers and initiate fraudulent wire transfers from customers' accounts. First Horizon sustained a loss of $42,000 from the scheme.
The Fed said that the conduct of Dean and McGlown constituted violations of law or regulation, unsafe or unsound banking practices, breaches of fiduciary duty and involved personal dishonesty and a disregard for each bank's safety and soundness.
Both former bank employees have been prohibited under the Federal Deposit Insurance Act, from working as an employee, officer, director, or agent of a bank or bank holding company, and from voting or attempting to vote for a bank director.
They both also waived their rights to a hearing or judicial review challenging the order to settle the matter without a formal proceeding or protracted litigation. But they also did not admit or deny any wrongdoing.
An M&T Bank spokesman declined to comment. First Horizon did not immediately respond to a request for comment.
Further, the Fed states on its searchable database that under the law, some prohibitions against individuals "may have expired and the individual might no longer be prohibited from holding a position at insured depository institutions or holding companies."
