---
kind: "section"
citation: "12 U.S.C. § 5393"
title: "12"
title_heading: "Banks and Banking"
number: "5393"
heading: "Ban on certain activities by senior executives and directors"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/12/5393"
units:
  - "Chapter 53 — Wall Street Reform and Consumer Protection"
  - "Subchapter II — Orderly Liquidation Authority"
---

# §5393. Ban on certain activities by senior executives and directors

- (a) **Prohibition authority—** The [Board of Governors](/usc/12/5301.md?p=3) or, if the [covered financial company](/usc/12/5381.md?p=a-8) was not supervised by the [Board of Governors](/usc/12/5301.md?p=3), the [Corporation](/usc/12/5301.md?p=7), may exercise the authority provided by this section.
- (b) **Authority to issue order—** The appropriate agency described in [subsection (a)](#a) may take any action authorized by [subsection (c)](#c), if the agency determines that—
  - (1) a senior executive or a [director](/usc/12/5341.md?p=1) of the [covered financial company](/usc/12/5381.md?p=a-8), prior to the appointment of the [Corporation](/usc/12/5301.md?p=7) as receiver, has, directly or indirectly—
    - (A) violated—
      - (i) any law or regulation;
      - (ii) any cease-and-desist order which has become final;
      - (iii) any condition imposed in writing by a Federal agency in connection with any action on any application, notice, or request by such [company](/usc/12/5381.md?p=a-5) or senior executive; or
      - (iv) any written agreement between such [company](/usc/12/5381.md?p=a-5) and such agency;
    - (B) engaged or participated in any unsafe or unsound practice in connection with any [financial company](/usc/12/5341.md?p=2); or
    - (C) committed or engaged in any act, omission, or practice which constitutes a breach of the fiduciary duty of such senior executive or [director](/usc/12/5341.md?p=1);
  - (2) by reason of the [violation](/usc/12/5561.md?p=5), practice, or breach described in any subparagraph of [paragraph (1)](#b-1), such senior executive or [director](/usc/12/5341.md?p=1) has received financial gain or other benefit by reason of such [violation](/usc/12/5561.md?p=5), practice, or breach and such [violation](/usc/12/5561.md?p=5), practice, or breach contributed to the failure of the [company](/usc/12/5381.md?p=a-5); and
  - (3) such [violation](/usc/12/5561.md?p=5), practice, or breach—
    - (A) involves personal dishonesty on the part of such senior executive or [director](/usc/12/5341.md?p=1); or
    - (B) demonstrates willful or continuing disregard by such senior executive or [director](/usc/12/5341.md?p=1) for the safety or soundness of such [company](/usc/12/5381.md?p=a-5).
- (c) **Authorized actions—**
  - (1) **In general—** The appropriate agency for a [financial company](/usc/12/5341.md?p=2), as described in [subsection (a)](#a), may serve upon a senior executive or [director](/usc/12/5341.md?p=1) described in [subsection (b)](#b) a written notice of the intention of the agency to prohibit any further participation by such [person](/usc/12/5481.md?p=19), in any manner, in the conduct of the affairs of any [financial company](/usc/12/5341.md?p=2) for a period of time determined by the appropriate agency to be commensurate with such [violation](/usc/12/5561.md?p=5), practice, or breach, provided such period shall be not less than 2 years.
  - (2) **Procedures—** The due process requirements and other procedures under section 8(e) of the Federal [Deposit](/usc/12/5301.md?p=18-A) Insurance Act ([12 U.S.C. 1818(e)](/usc/12/1818.md?p=e)) shall apply to actions under this section as if the [covered financial company](/usc/12/5381.md?p=a-8) were an [insured depository institution](/usc/12/5301.md?p=18-A) and the senior executive or [director](/usc/12/5341.md?p=1) were an institution-affiliated party, as those terms are defined in that Act [[12 U.S.C. 1811](/usc/12/1811.md) et seq.].
- (d) **Regulations—** The [Corporation](/usc/12/5301.md?p=7) and the [Board of Governors](/usc/12/5301.md?p=3), in consultation with the [Council](/usc/12/5301.md?p=8), shall jointly prescribe rules or regulations to administer and carry out this section, [including](/usc/12/5301.md?p=18-A) rules, regulations, or guidelines to further define the term senior executive for the purposes of this section.

## Source credit

(Pub. L. 111–203, title II, § 213, July 21, 2010, 124 Stat. 1517.)

## Notes

### Editorial Notes

### References in Text

The Federal Deposit Insurance Act, referred to in subsec. (c)(2), is act Sept. 21, 1950, ch. 967, § 2, 64 Stat. 873, which is classified generally to chapter 16 (§ 1811 et seq.) of this title. The terms “insured depository institution” and “institution-affiliated party” are defined in section 3 of the Act, which is classified to section 1813 of this title. For complete classification of this Act to the Code, see Short Title note set out under section 1811 of this title and Tables.

### Statutory Notes and Related Subsidiaries

### Effective Date

Section effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111–203, set out as a note under section 5301 of this title.