12 U.S.C. § 503 — Liability of directors and officers of member banks

This law makes bank directors and officers personally responsible when they break certain rules.

It applies to directors and officers of a "member bank" — a bank that is part of the Federal Reserve System. The rule covers two situations. First, it applies if a director^* or officer personally violates certain sections of federal banking law (sections 375, 375a, 375b, and 376 of this title) or related Federal Reserve Board regulations. Second, it applies if a director or officer knowingly lets any agent, officer, or director of the bank violate those same rules.

The law also covers certain federal crimes, listed in title 18, sections 217, 218, 219, 220, 655, 1005, 1014, 1906, and 1909. The text does not explain what each of these crimes is — it just points to them by number.

If a director or officer "participates in or assents to" a violation — meaning they take part in it or agree to let it happen — they become personally liable. This is personal, individual liability, not just liability for the bank as a whole.

That director or officer must pay for all the damages caused by the violation. This includes harm to the member bank itself, to its shareholders, and to any other person^* who was hurt by the violation.