A consent order can transform a financial institution’s entire compliance structure overnight.
These formal regulatory actions demand swift remediation, greater accountability, and improved oversight—often following repeated weaknesses in anti-money laundering (AML), know your customer (KYC), or broader risk management systems, claims AIPrise.
In May 2025 alone, the FDIC reported twelve orders and two notices, including one consent order, reflecting the growing emphasis on governance reform across the sector. For banks, acting early to address potential compliance gaps can significantly reduce remediation costs, limit operational restrictions, and rebuild regulator and stakeholder trust.
At its core, a consent order is a legally binding agreement between a bank and its regulator, designed to correct specific compliance deficiencies. These orders are not simply administrative—they reshape governance from the top down. Typically issued after recurring findings or serious violations, consent orders require structured remediation plans, detailed progress reporting, and independent validation. This heightened scrutiny encourages financial institutions to develop long-term strategies that go beyond short-term fixes, embedding sustainable compliance into daily operations.
The purpose of consent orders is to ensure institutions remain transparent, stable, and trustworthy. Regulators use them when existing internal controls fail to detect or prevent misconduct, particularly within AML or KYC frameworks. For example, the CFPB’s 2025 enforcement action against Wise US Inc. underscored how due diligence failures can trigger broad regulatory consequences. Consent orders also mandate leadership accountability, pushing boards to provide active oversight and demonstrate continuous improvement in risk management and compliance functions.
Once issued, these orders trigger comprehensive reform across compliance departments. Institutions must strengthen board governance, formalise risk frameworks, and ensure consistent monitoring and testing. Continuous surveillance, independent validation, and clear documentation become regulatory expectations. Consent orders also extend beyond internal operations, demanding enhanced vendor and third-party oversight to prevent external compliance risks. Ultimately, they help build a compliance environment that is both structured and transparent.
Understanding consent orders also requires recognising how they differ from other enforcement tools. Unlike informal supervisory communications, such as “matters requiring attention”, consent orders are publicly filed and legally enforceable. They may restrict product launches or partnership activity until remediation is complete, reflecting the seriousness of underlying governance issues. While cease-and-desist orders target unsafe practices immediately, consent orders often signal deeper, systemic compliance weaknesses requiring long-term correction.
However, remediation under a consent order is rarely straightforward. Financial institutions face challenges such as resource constraints, overlapping remediation projects, tight regulatory deadlines, and fragmented reporting systems. Maintaining leadership engagement over extended periods is equally difficult, as is sustaining morale among compliance teams under heavy scrutiny. Integrating new frameworks into legacy systems and coordinating consistent communication with regulators also remain major pain points throughout the process.
To navigate these complexities effectively, banks need a structured action plan. Key steps include conducting a comprehensive gap analysis, establishing cross-department remediation committees, and using compliance dashboards to track progress. Independent reviewers can validate corrective actions, while secure documentation ensures transparency and readiness for examiner review. Continuous board engagement and investment in upgraded technology are essential to demonstrate genuine, lasting progress to regulators.
This is where technology-driven compliance tools can make a critical difference. Platforms like AiPrise use artificial intelligence to automate core remediation processes, streamline audits, and accelerate compliance validation. The company’s AI-driven platform provides automated KYC and KYB verification, document intelligence, real-time AML screening, dynamic risk scoring, and centralised case management. By automating manual reviews and providing regulator-ready documentation, AiPrise enables institutions to close consent order requirements faster and maintain ongoing compliance with reduced operational strain.
Ultimately, a consent order represents more than a regulatory penalty—it’s a turning point for organisational reform. Institutions that treat it as an opportunity to modernise oversight, reinforce internal culture, and adopt intelligent automation will emerge stronger and more resilient. With the right structure and tools, banks can turn enforcement into empowerment—building compliance systems that stand the test of time.
Copyright © 2025 RegTech Analyst
Copyright © 2018 RegTech Analyst
