Since banks and similar financial lending institutions are regulated and insured by the federal government, they also fall under federal jurisdiction.
To ensure that loans are fairly evaluated and issued based solely on a person's qualifications, it is a federal crime for officials or agents of financial institutions to accept commissions or gifts for the procurement of a loan—and it's also a federal crime to offer a commission or gift for such a reason.
This law is embodied in the U.S. Code Title 18 Section 215, often referred to as "receipt of commissions or gifts for procuring loans" or, more simply, bank bribery.
If you are convicted of this federal crime, you could face exceptionally steep fines and up to 30 years in prison.
18 U.S.C. 215 says, “(a) Whoever (1) corruptly gives, offers, or promises anything of value to any person, with intent to influence or reward an officer, director, employee, agent, or attorney of a financial institution in connection with any business or transaction of such institution; or (2) ...they corruptly solicit or demands for the benefit of anyone, or corruptly accepts or agrees to, anything of value from any person, intending to be influenced or rewarded in connection with any business or transaction of such institution…. shall be fined or imprisoned…”
Subsection (c) says this statute does not apply to bona fide salary, wages, fees, or other compensation paid or expenses paid or reimbursed in the ordinary course of business.
Subsection (d) says that federal agencies responsible for regulating financial institutions will jointly establish guidelines to assist with compliance with this statute. Let's review this federal law further below.
What Does the Law Say?
According to Title 18 U.S.C. 215, either or both of the following actions is a federal crime:
- For anyone to corruptly give, offer, or promise "anything of value to any person, with intent to influence or reward an officer, director, employee, agent, or attorney of a financial institution in connection with any business or transaction of such institution."
- For any financial institution's officer, agent, or director to solicit, demand, or receive such a gift in connection with a business transaction.
In short, it is illegal to offer such rewards, and it is illegal to accept them.
To convict you under 18 U.S.C. 215, federal prosecutors must establish the following elements of the crime:
- That you gave or offered something of value;
- That you did so knowingly, willfully, and corruptly (i.e., with corrupt intent);
- That you intended to influence or reward an agent of the bank or financial institution; and
- That you did so in connection with a business transaction, which is, most commonly, a loan.
Likewise, if you're an agent of the financial institution and are accused of this crime, prosecutors must prove:
- That you solicited or demanded something of value;
- That you did so knowingly, willfully, and corruptly; and
- That your intention in doing so was to be influenced or rewarded in connection with a business transaction.
As noted, this law does not apply to normal wages, salaries, fees, bonuses, etc., paid to the bank employee or agent in the normal line of work.
What Are Some Examples?
EXAMPLE 1: Arnold is applying for a consolidation loan at a local lender. His credit could be better, so to improve his chances of getting the loan, he offers the lending officer a percentage of the loan if he approves the application.
Arnold is guilty of a federal crime for effectively bribing the officer to approve his loan.
EXAMPLE 2: Dave goes to his local bank to apply for a personal loan and talks to his friend George, who works there as a loan officer. George's son works as an intern at Dave's law firm.
As George is working on the loan application, he mentions to Dave, "the loan might go through more smoothly" if Dave promotes his son and gives him a raise.
Although no money exchanged hands between Dave and George, George can still be charged under 18 U.S.C. 215 because he solicited something of value in exchange for the loan approval.
What Are the Related Federal Laws?
18 U.S. Code Chapter 11, bribery, graft, and conflicts of interest have numerous federal statutes that are related to 18 U.S.C. 215 receipt of commissions or gifts for procuring loans, including the following:
- 18 U.S.C. 201 - bribery of public officials and witnesses;
- 18 U.S.C. 202 - definitions;
- 18 U.S.C. 203 - compensation to members of congress;
- 18 U.S.C. 204 - practice in United States Court of federal claims;
- 18 U.S.C. 205 - activities of officers and employees in claims;
- 18 U.S.C. 206 - exemption of retired officers of the services;
- 18 U.S.C. 207 - restrictions on former officers, elected officials;
- 18 U.S.C. 208 - acts affecting a personal financial interest;
- 18 U.S.C. 209 - salary of government officials and employees;
- 18 U.S.C. 210 - offer to procure appointive public office;
- 18 U.S.C. 211 - solicitation to obtain appointive public office;
- 18 U.S.C. 212 - offer of gratuity to financial institution examiner;
- 18 U.S.C. 213 - acceptance of gratuity by the financial examiner;
- 18 U.S.C. 214 - offer for procurement of Federal Reserve bank loan;
- 18 U.S.C. 215 - receipt of commissions or gifts for procuring loans;
- 18 U.S.C. 216 - penalties and injunctions;
- 18 U.S.C. 217 - acceptance of consideration for farm indebtedness;
- 18 U.S.C. 218 - voiding transactions in violation of chapter;
- 18 U.S.C. 219 - officers acting as agents of foreign principals;
- 18 U.S.C. 220 - illegal remunerations referrals to recovery homes;
- 18 U.S.C. 224 - bribery in sporting contests;
- 18 U.S.C. 225 - continuing financial crimes enterprise;
- 18 U.S.C. 226 - bribery affecting port security;
- 18 U.S.C. 227 - wrongfully influencing a private entity's employment decisions by a member of congress or executive branch employee.
What Are the Penalties for 18 U.S.C. 215?
The penalties can be severe if you are convicted of violating this federal law. The maximum penalties are as follows:
- Up to 30 years in prison; and
- A fine of up to $1 million OR three times the value of the bribe, whichever is greater.
What Are the Defenses for Bank Bribery?
If you have been accused of violating 18 U.S.C. 215, you should consult with a qualified federal criminal defense attorney as soon as possible.
While the charge is serious, a good attorney can implement one or more defense strategies to combat the accusations. The defenses are discussed below.
Perhaps we can argue that you did not act with corrupt intent. Proving that you deliberately and willfully tried to influence the procurement of the loan is a critical element of the prosecution's case.
If your attorney can demonstrate that you didn't know what you were doing was illegal, for example, they can argue that there was no corrupt intent.
Perhaps we can argue that you didn't give or accept anything of value. For example, suppose the prosecution cannot prove that money, goods, services, or other benefits (tangible or intangible) were exchanged in exchange for the loan procurement process. In that case, they may be unable to prove that a crime occurred.
Perhaps we can argue that the gift was not intended as a bribe. For example, if you were friends with the bank officer and offered something of value as a simple gift with no strings attached (i.e., not intended to influence the transaction), you may be able to get the charges dismissed.
You can contact our law firm for an initial case examination via phone or the contact form. We provide legal representation on federal criminal matters across the United States. Eisner Gorin LLP is based in Los Angeles, California.