---
title: "Civil Money Penalty: definition, formula, and thresholds"
description: "A Civil Money Penalty (CMP) is a monetary fine imposed by a bank regulator for violations of law, regulation, or supervisory agreement. CMPs can range from thousands to billions of dollars depending on the violation."
canonical_url: https://www.bankregreports.com/glossary/civil-money-penalty/
source: BankRegReports
category: "Supervision & Ratings"
units: "$"
schedule: "Public enforcement databases"
---

# Civil Money Penalty

> A Civil Money Penalty (CMP) is a monetary fine imposed by a bank regulator for violations of law, regulation, or supervisory agreement. CMPs can range from thousands to billions of dollars depending on the violation.

## Formula

```
Maximum statutory CMP per day: Tier 1 ~$11K, Tier 2 ~$57K, Tier 3 ~$2.3M (per 12 USC §1818(i), inflation-adjusted annually).
```

The three statutory tiers escalate by severity. Tier 1 covers minor violations; Tier 2 covers reckless or pattern violations; Tier 3 covers knowing violations with substantial benefit or loss. Daily maximums multiplied by violation duration can produce penalties in the hundreds of millions or billions in egregious cases.

## Why it matters

CMPs are the visible cost of enforcement. Large banks have paid some of the biggest penalties in recent years. Wells Fargo agreed in April 2018 to a $1 billion penalty to the CFPB and the OCC over auto-loan insurance and mortgage rate-lock practices. In July 2023 the CFPB and the OCC ordered Bank of America to pay about $250 million for consumer harms. JPMorgan Chase paid about $920 million in September 2020 to resolve spoofing and market-manipulation cases brought by the DOJ, CFTC and SEC. Banking-agency CMPs go to the Treasury, and CFPB penalties go to the CFPB's Civil Penalty Fund for victim relief; harmed customers may also receive restitution.

## How to read it

CMP size is the regulator's signal of severity. Penalties under $1M reflect minor violations; $1M-$100M reflects significant control failures; over $100M signals systemic misconduct or material customer harm. CMPs are typically issued in conjunction with consent orders that require corrective actions.

## Thresholds

| Range | Reading | What it means |
|---|---|---|
| < $1M | Minor | Routine violations or first-time issues. |
| $1M–$100M | Significant | Material control or compliance failures. |
| $100M–$1B | Severe | Systemic misconduct or extensive customer harm. |
| > $1B | Headline | Major bank-wide misconduct case. |


## Worked example

In September 2021 the OCC assessed a $250 million civil money penalty against Wells Fargo Bank, N.A. under 12 USC 1818(i) for deficiencies in its home lending loss-mitigation program. It was separate from Wells Fargo & Company's $3 billion settlement with the Department of Justice and the SEC in February 2020 over the fake-account scandal, which was not a banking-agency civil money penalty.

## Questions

### Where does CMP money go?

Penalties assessed by the banking agencies go to the US Treasury. CFPB penalties go to its Civil Penalty Fund, which compensates victims. CMPs do not fund the regulators' operations. Some banks have also paid voluntary 'remediation' amounts directly to harmed customers in addition to formal CMPs.

### Can multiple agencies impose CMPs for the same conduct?

Yes. A single bank misconduct can produce CMPs from multiple agencies (DOJ, OCC, FRB, FDIC, CFPB, SEC, state regulators) addressing different statutory violations. Total agency settlements in major cases often exceed $1B across all agencies.

### How are individual employees affected?

CMPs against individuals (officers, directors, employees) are also authorized under §1818(i) and can include personal fines and prohibition orders. Individual prohibition orders bar named individuals from working in the banking industry.

## Sources

- 12 USC §1818(i): Federal banking agency CMP authority
- DOJ, OCC, FRB, FDIC, CFPB enforcement action databases

## Related metrics

- [Consent Order](https://www.bankregreports.com/glossary/consent-order/): A Consent Order is a formal public enforcement action where a bank agrees to specified corrective actions without admitting or denying alleged violations. Consent orders are the most common form of formal bank supervisory action.
- [Cease and Desist Order](https://www.bankregreports.com/glossary/cease-and-desist-order/): A Cease and Desist Order is a formal supervisory action directing a bank to stop unsafe or unsound practices or violations of law. C&D orders may be contested or issued as consent orders; both carry the same legal force.
- [Enforcement Actions](https://www.bankregreports.com/glossary/enforcement-actions/): Enforcement actions are formal and informal measures bank regulators take against an institution or its officers: consent orders, cease-and-desist orders, civil money penalties, and written agreements. They are the public footprint of supervisory problems.
- [Memorandum of Understanding](https://www.bankregreports.com/glossary/memorandum-of-understanding/): A Memorandum of Understanding (MOU) is an informal, non-public supervisory agreement between a bank and its regulator. MOUs are an intermediate step between informal supervisory communication and formal enforcement action.

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