Prohibited Acts.

Ala. Code tit. 5, ch. 6A, art. 2

in effect

Ala. Code § 5-6A-20 Declaration of Illegal Dividends, Discounts of Notes, Etc.

5-6A-20. Declaration of Illegal Dividends, Discounts of Notes, Etc. Any director of a bank who knowingly concurs in any vote or act of the directors of such bank by which it is intended to pay a cash dividend except from the undivided profits arising from the business of the bank in violation of Section 5-5A-21, or to make or approve a loan with the stock of the lending bank as security therefor; to divide, withdraw or in any manner pay to the stockholders or any of them any part of the capital of the bank, or to purchase or reduce such capital, except in pursuance of law; or to discount or receive any note or other evidence of debt in payment of any installment of purchase price of capital actually called in and required to be paid, or with intention to provide the means of making such payment; or to receive or discount any note or other evidence of debt with the intent to enable any stockholder to withdraw any part of the money paid in by him on his stock; or to apply any portion of the funds of such corporation except as allowed by law, directly or indirectly, to the purchase of shares of its stock, is guilty of a misdemeanor. (Acts 1980, No. 80-658, §5-6-20.)

Ala. Code § 5-6A-21 Concealment of Loans, Purchase or Sale of Security, Etc.

5-6A-21. Concealment of Loans, Purchase or Sale of Security, Etc. Any officer or employee of a bank who intentionally conceals from the directors or a committee of such bank where the directors have delegated authority to a committee to pass on loans and discounts, any discount or loan made for and in behalf of the bank between the regular meetings of its board of directors or committee or the purchase or the sale of any of its securities during the same period is guilty of a misdemeanor. (Acts 1980, No. 80-658, §5-6-21.)

Ala. Code § 5-6A-22 Overdrawing Own Account; Receipt of Commissions, Etc., to Procure Loans, Discounts, Etc.

5-6A-22. Overdrawing Own Account; Receipt of Commissions, Etc., to Procure Loans, Discounts, Etc. Any officer, director, or employee of a bank who willfully and knowingly overdraws his account with such bank and thereby obtains money or funds of any such bank except as the superintendent shall allow by regulation, or asks, receives, consents or agrees to receive any commission, emolument, gratuity, or reward or any promise of any commission, emolument or reward, or any money, property or thing of value or of personal advantage in procuring or endeavoring to procure for any person, firm or corporation any loan from or the purchase or discount of any paper, note, draft, check or bill of exchange by any such bank is guilty of a misdemeanor. (Acts 1980, No. 80-658, §5-6-22.)

Ala. Code § 5-6A-23 Receipt or Possession of Bank Property with Intent to Defraud, Etc.

5-6A-23. Receipt or Possession of Bank Property with Intent to Defraud, Etc. Any director, officer or employee of a bank who knowingly receives or possesses himself of any of its property otherwise than in payment for a just demand and with intent to defraud shall be guilty of a felony. (Acts 1980, No. 80-658, §5-6-23.)

Ala. Code § 5-6A-24 Making of False Entries, Etc., on Books and Accounts of Bank.

5-6A-24. Making of False Entries, Etc., on Books and Accounts of Bank. Any director, officer or employee of a bank who with intent to defraud makes or concurs in making any false entry, or with intent to defraud omits or concurs in omitting to make any material entry on its books and accounts, shall be guilty of a felony. (Acts 1980, No. 80-658, §5-6-24.)

Ala. Code § 5-6A-25 Fraudulent Representation as to Capital, False Reports, Etc., as to Condition of Bank, Etc.

5-6A-25. Fraudulent Representation as to Capital, False Reports, Etc., as to Condition of Bank, Etc. Any director, officer, or employee of a bank who knowingly, by newspaper advertisement or otherwise, represents its capital to be in excess of the actual capital accounts or knowingly concurs in making or publishing any materially false written report, exhibit, or statement of its financial condition, making any material statement which is false, or refuses or intentionally neglects to make any report or statement required by Chapters 1A through 13B and Chapter 20 of this title is guilty of a felony. (Acts 1980, No. 80-658, §5-6-25; Acts 1995, No. 95-115, p. 134, §73.)

Ala. Code § 5-6A-26 Loans or Extension of Credit to Bank Officers and Employees.

5-6A-26. Loans or Extension of Credit to Bank Officers and Employees. An officer or employee of any bank who shall in any way obtain as a borrower any of the funds of such bank without having first complied with the requirements of this section must on conviction be punished as if he had embezzled the amount borrowed. Any loan obtained by an officer or employee of a bank must be made in accordance with a written loan policy which has been adopted by the board of directors. Such loans or extensions of credit may be made only if (i) the bank would be authorized to make such loans or extensions of credit to borrowers other than officers and employees and (ii) such loans or extensions of credit to officers and employees do not involve more than the normal risk of repayment or present other unfavorable features. All such loans, extensions of credit, or lines of credit to an officer must be reported to the board of directors at its next meeting. (Acts 1980, No. 80-658, §5-6-26.)

Source: Alabama Legislature (alison.legislature.state.al.us)URL: https://alison.legislature.state.al.us/code-of-alabamaFetched: 10/20/2026