---
title: "Consent Order: definition, formula, and thresholds"
description: "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."
canonical_url: https://www.bankregreports.com/glossary/consent-order/
source: BankRegReports
category: "Supervision & Ratings"
units: "count"
schedule: "Public enforcement databases"
---

# 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.

## Formula

```
Consent orders are issued under 12 USC §1818(b) (cease-and-desist authority).
```

Consent orders are issued by the bank's primary federal regulator: the OCC for national banks, the Federal Reserve for state member banks and BHCs, and the FDIC for state non-member banks. Consent orders are public; the regulated entity agrees to corrective actions and often pays a civil money penalty.

## Why it matters

A consent order is a publicly visible signal of significant supervisory concern. It typically requires the bank to enhance its risk management, governance, or compliance programs under specified timeframes. Common subjects: BSA/AML compliance, fair lending, consumer protection, capital planning, and operational controls.

## How to read it

Banks under consent order face restrictions on growth, M&A activity, dividend payments, and new product launches. The order typically lists specific milestones with completion deadlines (90 days, 180 days, 1 year). Removal of the consent order requires regulator certification that all conditions have been satisfied, typically 18-36 months from issuance.

## Thresholds

| Range | Reading | What it means |
|---|---|---|
| None active | Clean | No formal enforcement action. |
| Topical / narrow | Specific issue | Focused on a single subject. |
| Multi-agency / multi-topic | Major | Broad governance or risk-management concerns. |
| Multiple active orders | Severe | Pattern of significant supervisory concern. |


## Worked example

A large national bank received a 2024 OCC consent order related to deposit-account management practices. The order required (1) board oversight committee establishment, (2) enhanced policies within 90 days, (3) independent compliance review within 180 days, and (4) restoration of affected customers. A $50M civil money penalty was assessed alongside.

## Questions

### How is a consent order different from a cease-and-desist order?

A consent order is the bank's voluntary agreement to corrective actions, while a contested cease-and-desist order is imposed after administrative hearing. Consent orders are issued under the same statute (§1818(b)) but reflect the bank's consent rather than adjudication.

### How long do consent orders typically last?

Most consent orders remain in effect 18 months to 3 years, and some run longer. Removal requires a formal regulator determination that conditions have been satisfied. Some orders include sunset provisions; others remain open until explicit termination.

### Do consent orders restrict bank operations?

Often yes: restrictions on dividends, M&A activity, expansion into new products or geographies, and senior-management changes are common. The bank must obtain agency approval for activities the order restricts.

## Sources

- 12 USC §1818(b): Federal cease-and-desist authority
- OCC, Federal Reserve, FDIC public enforcement action databases

## Related metrics

- [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.
- [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.
- [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.
- [Civil Money Penalty](https://www.bankregreports.com/glossary/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.

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