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Compliance News

The latest compliance news items. Past months’ news items are found under the specific Compliance Topic page related to the news item.

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March | April

April News

  • CFPB’s Kraninger Signals Next Steps on Clarifying ‘Abusive’ Standard in UDAAP (4/18/19)
    The Consumer Financial Protection Bureau will take the next step in its effort to clarify the meaning of “abusive acts or practices” under Section 1031 of the Dodd-Frank Act, CFPB Director Kathy Kraninger said in her first public remarks. Plans to provide clarity—long sought by ABA and other industry participants—have been signaled for months; Kraninger said the CFPB would hold a public symposium in the coming months to solicit stakeholder feedback on the abusive standard, which is much less defined and understood than the unfair or deceptive acts or practices standard.
  • Fed’s Bowman: Compliance Concerns Hindering Community Bank Innovation (4/15/19)
    Federal Reserve Governor Michelle Bowman expressed concern last week that regulatory complexities and compliance issues could be hindering community banks' approach to innovation. In remarks at an event at the Federal Reserve Bank of San Francisco, she offered her thoughts on steps the agency could take to foster innovation and collaboration between community banks and fintech firms.
  • CFPB Releases Report on Veterans' Financial Well-Being (4/15/19)
    The Consumer Financial Protection Bureau last week released a study on the financial well-being of veterans. According to the study, attributes such as higher education, homeownership, and good physical health are positively associated with financial well-being; however, veterans show lower financial well-being levels when they use short-term credit products, are regularly contacted by debt collectors, or incur student loan debt, the study found.
  • EEO-1 Reporting Delayed Until September 30 (4/8/19)
    The U.S. Equal Employment Opportunity Commission announced in a court filing that it is delaying the deadline to September 30, 2019, for employers to submit EEO-1 survey data for 2018. Last week, ABA joined other industry trade groups in urging Senate Majority Leader Mitch McConnel (R-Ky.) to confirm Janet Dhillon to be a member of the EEOC. Dhillon's confirmation would result in a quorum being present at the EEOC, strengthening the agency’s ability to modify or rescind the expanded EEO-1 data fields. For more information, contact ABA's Jonathan Thessin.
  • ABA, Trades Urge Continued Allowance of Estimates in Remittance Disclosures (4/8/19)
    ABA joined The Clearing House and other industry trade associations in urging the Bureau to continue to permit banks and other insured institutions to provide estimates of pricing information in remittance transfer disclosures where the exact amounts cannot reasonably be determined. The Bureau's remittance rule requires companies that provide remittance transfers to disclose to the customer exact pricing information, but includes a temporary exception for insured institutions to provide estimates of this pricing information. That exception expires on July 21, 2020. For more information, contact ABA's Jonathan Thessin.
  • FDIC Warns on 'Gaps' in Tech Vendor Contracts (4/4/19)
    The FDIC issued a letter to all banks outlining gaps that some examiners had noted in banks’ contracts with technology vendors and reiterating regulatory requirements for these contracts. Some contracts did not require the vendor to have a business continuity plan, establish recovery standards, define remedies if a vendor misses a standard, detail a vendor’s post-incident notification duties or define key terms related to business continuity and incident response. The letter reminded banks about the interagency guidelines setting information security standards, which were issued under the Gramm-Leach-Bliley Act and the notification requirements under Section 7 of the Bank Service Company Act. For more information, contact ABA's Krista Shonk​.
  • ABA Issues Staff Analysis, Seeks Banker Feedback on Proposed Overtime Rule  (4/4/19)
    ABA has published a staff analysis on the Department of Labor’s proposed rewrite of the Obama administration’s overtime rule, which was adopted in 2016 but never took effect due to a federal judge’s ruling later that year. Comments on the proposal are due by May 21, 2019. ABA is inviting interested bankers to participate in conference calls scheduled over the next two weeks to provide feedback on the proposed rule. For more information, or to provide feedback on the proposed rule, contact ABA's Jonathan Thessin.
  • Money Smart Week is March 30-April 6 (4/3/19)
    The Consumer Financial Protection Bureau and the Chicago Federal Reserve Bank are observing March 30-April 6 as Money Smart Week. During the week, financial education activities are highlighted. This includes classes and seminars offered by local and regional organizations across the U.S. This year, the theme focuses on helping parents and caregivers teach their children about money management. The CFPB’s Money As You Grow​ website has tips and activities to grow children’s money skills, habits, and attitudes. The ABA Foundation also provides financial education programs and resources that help bankers make their communities better. Learn more.
  • Kraninger Announced as FFIEC Chair (4/1/19)
    Consumer Financial Protection Bureau (CFPB) Director Kathleen L. Kraninger is the new Chairman of the Federal Financial Institutions Examination Council (FFIEC), according to an announcement by the FFIEC today. Chairman Kraninger's two-year term ends on March 31, 2021. She succeeds Jelena McWilliams, Chairman, Federal Deposit Insurance Corporation. "I look forward to engaging with my colleagues and remain committed to finding effective ways to collaborate on supervisory matters, including the use of appropriate technology. Under my leadership, I plan to focus on building a culture of compliance that prevents consumer harm in the first place," Kraninger said.
  • CFPB's Consumer Response Annual Report Shows Companies Timely Responded to Complaints (4/1/19)
    The Bureau reported that banks and other companies timely responded to 98% of complaints submitted through the Bureau in 2018, according to the Bureau’s Consumer Response Annual Report for 2018. The timely response rate reflects a slight increase from the 97% timely response rate reported for 2017. The report, which the Bureau is required to submit to Congress by March 31 of each year, provides aggregate totals of complaints submitted, as well as breakdowns of complaints by the type of product complained about. Contact Jonathan Thessin for more information.​​

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March News

  • 2018 HMDA Modified LARs Now Available (3/29/19)
    The Consumer Financial Protection Bureau announced Friday that the 2018 Home Mortgage Disclosure Act (HMDA) Modified Loan Application Register (LAR) files are now available for download. The Modified LARs contains loan level information for 2018 on individual HMDA filers, modified to protect privacy. Later this year, additional information will be published related to HMDA, including: a complete loan level dataset and HMDA aggregate and disclosure reports.
  • GAO Recommends Beefing Up FTC, CFPB Enforcement of Nonbank Data Privacy (3/29/19)
    To mitigate the risk of data breaches like the Equifax breach in 2017, the Federal Trade Commission should have civil penalty authority to enforce the consumer privacy requirements of the Gramm-Leach-Bliley Act, according to a report by the Government Accountability Office. The GAO also said that the Consumer Financial Protection Bureau, which has supervisory authority over large consumer reporting agencies, should identify additional sources of information to ensure it is supervising all the CRAs that it should be, and that the bureau should prioritize data security in its examinations of CRAs.
  • OCC Adopts Revised Examination Procedures for Prepaid Accounts Rule (3/29/19)
    The OCC issued revised interagency examination procedures for evaluating compliance with the Consumer Financial Protection Bureau's prepaid accounts rule. The procedures take effect on April 1. The rule, finalized in 2016, establishes comprehensive consumer protections for prepaid accounts by applying Regulation E coverage; setting disclosure standards; and classifying certain prepaid accounts with credit features as subject to Regulation Z. The revised examination procedures incorporate the CFPB's amendments to Reg E and Reg Z. ​​
  • The Clearing House Releases Business Principles for the RTP® Network (3/28/19)
    The Clearing House released a set of eight "business principles" that will govern the operation of its RTP network, a new real-time core payments system. The principles—which TCH said were informed by input from community banks, credit unions and corporate end users—emphasize openness, accessibility and transparency.
  • Upcoming Changes to MLA Website (3/28/19)
    The Department of Defense's MLA Website announced that the website will be upgraded on April 9, 2019. As a result of this upgrade, name fields (First, Middle, and Last) will no longer accept numeric characters. Users can only enter alphabetic characters (A-Z and a-z), spaces ( ), dashes (-), and apostrophes (') in the Name fields. This change was implemented as an additional security measure.
  • FFIEC 2019 Guide to HMDA Reporting Now Available (3/25/19)
    The Federal Financial Institutions Examination Council’s 2019 Guide to HMDA Reporting is now available for download. The 2019 guide focuses on HMDA data submissions due March 1, 2020, and offers the most official resource for assisting institutions in their HMDA reporting. This edition reflects amendments made to HMDA by the Economic Growth, Regulatory Relief, and Consumer Protection Act and the 2018 HMDA interpretive and procedural rule issued by the CFPB. The appendices provide additional implementation materials bankers may find useful.​​
  • CFPB Seeks Advisory Council Applications (3/22/19)
    The Consumer Financial Protection Bureau is requesting applications for positions on its various advisory panels. The Community Bank Advisory Council, which meets three times per year, is intended to provide the bureau feedback from banks with $10 billion or less in assets. Council members are named to two-year terms. The CFPB is also seeking applicants for its Consumer Advisory Board, which advises the bureau on emerging trends and challenges related to consumer financial products and services. The board will also meet three times per year and is open to bankers from institutions with more than $10 billion in assets. Board members are named to two-year terms. For more information, contact ABA's Jonathan Thessin.
  • CFPB Proposal on Debt Collection Expected This Spring (3/21/19)
    The Consumer Financial Protection Bureau is expected to issue a notice of proposed rulemaking this spring to address a number of issues related to debt collection, including communication practices and consumer disclosures, according to its annual report to Congress on the Fair Debt Collection Practices Act released on March 20. The report—which summarizes efforts by the CFPB and the Federal Trade Commission to enforce the FDCPA and educate consumers about debt collection—noted that the bureau fielded more than 81,000 complaints from consumers about first- and third-party debt collectors in 2018, and engaged in six public enforcement actions arising from alleged FDCPA violations. For more information, contact ABA's Diana Banks​.
  • FTC Proposes Amendments to Safeguards and Privacy Rules (3/20/19)
    The FTC released two proposals on March 5 to update their version of the GLBA privacy rule and their Safeguards Rule (requiring companies to have in place procedures to safeguard customer information). The proposed changes would bring the rules into line with changes implemented by Congress through the Dodd-Frank Act in 2010 and the FAST Act in 2015, which modified the annual privacy notice requirement under the Gramm-Leach Bliley Act. Comments are due 60 days after Federal Register publication. Contact Rob Rowe​ for more information.​​
  • ABA Urges Extension of Compliance Date of CFPB Small-Dollar Lending Rule (3/18/19)
    In a comment letter filed today, ABA urged the Consumer Financial Protection Bureau to extend the compliance date for all provisions in the CFPB's final rule governing short-term, small-dollar loans. The extension would give the bureau time to revise the rule to exclude traditional consumer loans offered by banks — such as "bridge" loans, demand lines of credit, and loans secured by securities — which the rule would regulate if not modified. Finalized in October 2017, the rule imposes an ability-to-pay test, payment withdrawal restrictions, and notice requirements on a wide swath of short-term loans, including payday loans, auto title loans, deposit advances and longer-term loans with balloon payments. The bureau has proposed to rescind the rule's underwriting provisions and to extend the Aug. 19, 2019, compliance date for those provisions. For additional information, contact Jonathan Thessin​.
  • Fed's Brainard Discusses Potential Changes to CRA Assessment Area Definition (3/15/19)
    As financial regulators continue their review of the Community Reinvestment Act regulations, Federal Reserve Governor Lael Brainard said that they are considering making adjustments to the assessment area definition that would allow banks to receive CRA consideration for community development activities in a more expansive area. Brainard added that this approach "would help eliminate uncertainty and could encourage more capital for affordable housing, community facilities, and economic development activities in underserved areas."
  • ABA, Trade Groups Call for National Beneficial Ownership Registry (3/15/19)
    As the House Financial Services Committee held a hearing on financial crimes, ABA joined eight other financial trade organizations in a letter to committee leaders highlighting the need for a national beneficial ownership registry. While banks are required to collect the beneficial ownership information of their customers, the groups noted that the lack of a single, centralized federal registry that could be used to verify that information "represents a significant gap in the U.S. regulatory system that allows criminals, money launderers, kleptocrats and terrorist financiers to obscure their identities from law enforcement."
  • ABA Updates Enforcement Action Database (3/8/19)
    ABA recently updated the enforcement database to include five enforcement actions. The FDIC and OCC both issued two enforcement actions this month. Two of the enforcement actions, one from the FDIC and one from the OCC, were for BSA violations and deficiencies. The FDIC also assessed a civil money penalty for $2,700 against a bank for flood violations. In its second enforcement action this month, the OCC issued a cease and desist order to a bank due to unsafe and unsound practices relating to its compliance management systems. Lastly, in an agreement with the DOJ, a company agreed to pay $750,000 to six service members to resolve its alleged violations of the Servicemember Civil Relief Act. Contact Teshale Smith​ with questions. ​
  • CFPB Seeks Public Comment on PACE Loans (3/7/19)
    The Consumer Financial Protection Bureau requested public feedback on Property Assessed Clean Energy loans, a controversial type of financing that allows homeowners to pay for energy-efficient retrofitting — such as solar panels and high-efficiency air conditioners — through their property tax assessments, and which often take lien priority over the first mortgage lien. S. 2155, the regulatory reform law enacted last year, requires the CFPB to apply the Truth in Lending Act’s ability-to-repay requirements and civil liability provisions to PACE loans. The American Bankers Association has long raised concerns about these loans over their lack of full consumer protections and supported efforts to enhance that protection. ​
  • FFIEC Issue Policy Statement on Examination Reports (3/7/19)
    As part of its ongoing exam modernization initiative, the Federal Financial Institutions Examination Council (FFIEC) issued a policy statement aimed at promoting clarity and consistency of examination reports. The policy statement—which is intended to reduce regulatory burden for community banks—includes principles that "set forth minimum expectations of what should be included in all reports of examination." The principles establish that all report of examinations should present conclusions and issues in order of importance; document the condition and risk profile of the institution; discuss the adequacy of the institution’s risk management practices; and document issues of supervisory concern or warranting prompt corrective action.
  • ABA Opposes CFPB's Premature Debt Collection Data Survey (3/5/19)
    In a letter to the Consumer Financial Protection Bureau, ABA objected to the bureau’s request to the Office of Management and Budget to conduct a debt collection survey, citing the need for the CFPB to solicit public feedback before moving forward. The CFPB’s survey, which attempts to measure consumer understanding of model debt validation notices and model debt collection disclosures, has not been subjected to broad public comment as required under the Paperwork Reduction Act, ABA pointed out. The association added that consumer testing should only move forward once the CFPB has heard from all interested parties via a notice and comment process. For more information, contact ABA's Diana Banks.
  • FFIEC Releases 2019 CRA Data Entry Software, 2019 Edits, and 2019 File Specifications (3/5/19)
    The FFIEC released edits and file specifications for the 2019 CRA filings. The Federal Reserve System, on behalf of the FFIEC designed the CRA Data Entry Software (DES) to assist respondents in automating the filing of their CRA data. The free software includes editing features to help verify and analyze the accuracy of the data. The data file created using this software can be submitted by one of the available submission methods listed in the software. For more information on using the FFIEC's CRA DES, refer to DES frequently asked questions​. See ABA's CRA page  for more information. ​
  • CFPB Unveils Electronic Platform for Prepaid Account Agreement Submissions (3/1/19)
    Ahead of the effective date of its prepaid rule, the Consumer Financial Protection Bureau unveiled a new electronic submission system — Collect — that prepaid account issuers may use to submit their account agreements to the bureau. The CFPB also released several related compliance materials including a user guide, quick reference guide, FAQs and a recorded webinar. All prepaid account agreements that are offered as of April 1, 2019, must be submitted to the CFPB by May 1, 2019; after that date, issuers must notify the bureau when a new agreement is offered, a previously submitted agreement is amended or a previously submitted agreement is no longer offered.

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