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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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April | May

May News

  • FinCEN Recognizes Agencies that Use BSA Reporting to Prosecute Criminals (5/16/19)
    The Financial Crimes Enforcement Network (FinCEN) on May 16 held its Fifth Annual Law Enforcement Awards Program to recognize the efforts of several law enforcement agencies that use Bank Secrecy Act (BSA) reporting to successfully pursue and prosecute criminal investigations. Yesterday's awards program concluded the Bank Secrecy Act Advisory Group (BSAAG) Plenary. BSAAG advises the U.S. Treasury Department on the operations of the BSA. Rob Rowe who currently serves as the ABA representative to the BSAAG, presented the award for Significant Fraud on behalf of ABA.
  • ABA Updates Enforcement Action Database (5/15/19)
    ABA recently updated the enforcement database to include eight enforcement actions. The FDIC issued four enforcement actions. The FDIC assessed a total of $200,000 in civil money penalties against a bank for UDAP and TCPA violations. The FDIC also issued a cease and desist order against two banks for BSA and CMS violations. The Federal Reserve entered into a consent order with a bank for BSA/AML violations and deficiencies with OFAC regulations. The OCC also entered into a consent order with a bank relating to deficiencies with its BSA compliance program. Lastly, Treasury issued two enforcement actions relating to OFAC violations. For the OFAC violations, one bank entered into a settlement for $1.3 billion and the other bank was assessed a $1.1 billion civil money penalty. Contact Teshale Smith with questions.
  • CFPB Proposes Methodology for Review of Rules under the RFA and Review of the 2009 Overdraft Rule (5/13/19)
    The Bureau published two proposals: a request for comment on its proposed methodology for review of rules under the Regulatory Flexibility Act (RFA), and a request for comment on its first RFA review of the 2009 Overdraft Rule. The purpose of the periodic review of rules under the RFA is to minimize any significant economic impact of the rules upon a substantial number of small entities, consistent with the objectives of applicable statutes. The CFPB also announced the launch of its first RFA review, which is the 2009 Overdraft Rule. For questions on the review of rules under the RFA, contact Nessa Feddis. For questions on the Overdraft Rule review under the RFA, contact Jonathan Thessin.
  • FinCEN Issues Guidance on Convertible Virtual Currencies (5/10/19)
    The Financial Crimes Enforcement Network issued guidance on how its regulations apply to money transmission involving convertible virtual currencies. FinCEN said the guidance does not impose new regulatory requirements but rather consolidates existing regulations, administrative rulings and guidance. FinCEN also issued an Advisory to assist financial institutions in identifying and reporting suspicious activity related to criminal exploitation of CVCs for money laundering, sanctions evasion, and other illicit financing purposes.
  • FHA Proposes Changes to Lender Certification Requirements (5/10/19)
    The Federal Housing Administration issued a proposal making changes to its single-family loan and lender-level certifications in an effort to encourage greater bank participation in the FHA program. FHA is proposing to revise the addendum to the Uniform Residential Loan Application to provide greater clarity, streamline information and better align language in the addendum with existing statute and FHA policy. Comments on the proposal will be due June 8.
  • FHA Seeks Feedback on Single-Family Loan Sale Program (5/10/19)
    The Federal Housing Administration issued an advance notice of proposed rulemaking seeking public feedback on its single-family loan sale program as it looks to make the program permanent. Through the program, eligible single-family mortgage loans are assigned to FHA in exchange for claim payment, and mortgage notes are sold competitively to maximize recoveries and strengthen the FHA Mutual Mortgage Insurance Fund. Specifically, FHA is seeking feedback on program obstacles, benefits and drawbacks for single family loan servicers, bidders and purchasers. Comments are due by July 5. For more information, contact ABA's Rod Alba.
  • Fed Transfers SAFE Act Rulemaking Authority to CFPB (5/10/19)
    The Federal Reserve approved final amendments transferring its rulemaking authority for the Secure and Fair Enforcement Mortgage Licensing Act—which mandates a nationwide licensing and registration system for residential mortgage loan originators—to the CFPB. Entities previously subject to Fed rules are now subject to the CFPB rules. The amendments will be effective 30 days after publication in the Federal Register.
  • Fed Floats Extended Hours to Facilitate Same-Day ACH (5/10/19)
    The Federal Reserve sought public comment on whether the Fed banks should extend the daily operating hours of the National Settlement Service (NSS) and Fedwire Funds Service to facilitate adoption of a third same-day ACH processing and settlement window. The request for comment comes after NACHA, the electronic payments association, last fall approved a third same-day ACH window. The Fed proposed extending NSS operating hours by one hour to 6:30 p.m. ET, extending the time for initiating Fedwire transfers on behalf of third parties by 45 minutes to 6:45 p.m. ET and closing Fedwire half an hour later at 7 p.m. ET. The Fed also requested comment on corresponding changes to the Fed's Policy on Payment System Risk. Comments are due 60 days after the notice is published in the Federal Register. For more information, contact ABA's Steve Kenneally.
  • ABA Staff Analysis: OCC Pilot Program Proposal (5/8/19)
    ABA issued a Staff Analysis on the OCC's proposed Innovation Pilot Program, designed to provide a framework for banks to engage with the OCC on small-scale short-term tests. Under the proposed terms of the program, OCC-supervised banks could request OCC participation in a pilot of up to 24 months. Tools that the OCC might use would include interpretive letters, supervisory feedback and technical assistance. The legal permissibility of the proposed activity must be determined before any live test can begin. Pilot projects must include reasonable controls and exit strategies. Comments on the OCC's proposed program are due by June 14. For more information, contact ABA's Rob Morgan.
  • ABA Calls for Broader Application of TILA to PACE Loans (5/7/19)
    ABA offered feedback to the Consumer Financial Protection Bureau on its planned rulemaking on residential Property Assessed Clean Energy (PACE) 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. Contact Joe Pigg with questions.
  • Bureau Issues Notice of Proposed Rulemaking to Implement FDCPA (5/7/19)
    The Bureau issued a Notice of Proposed Rulemaking to implement the Fair Debt Collection Practices Act (FDCPA). Among other things, the proposal would set clear limits on the number of calls debt collectors may place to reach consumers on a weekly basis; clarify how collectors may communicate lawfully using voicemails, emails and text messages; and require collectors to provide additional information to consumers to help them identify debts and respond to collection attempts. Read a summary and flowchart of the proposed rule. Comments are due 90 days after publication in the Federal Register. Contact Diana Banks with questions.
  • Bureau Releases ID Theft Protection Guide (5/7/19)
    The Bureau released Identity Theft Protection Guide to offer suggestions on ways to guard consumers against identity theft. The guide offers five ways to protect consumers from identity theft: first, if you suspect that your personal information was exposed in a data breach, consider placing a freeze on your credit reports; second, review your financial statements regularly; third, review your credit reports at least once a year; fourth, consider a fraud alert to add an extra layer of protection to your credit report; and finally, consider using identity and credit monitoring services to scan your credit reports and alert you when a change occurs.
  • CFPB Proposes to Raise HMDA Reporting Thresholds (5/3/19)
    The Consumer Financial Protection Bureau on May 2 issued a proposal to provide relief for smaller institutions from the Home Mortgage Disclosure Act (HMDA) data collection and reporting requirements. The proposal would increase the coverage threshold for closed-end mortgage loans from 25 loans to either 50 or 100. For open-end lines of credit, the CFPB is proposing to extend for another two years the current temporary coverage threshold of 500 open-end lines of credit. After that, the threshold would be permanently set at 200. Contact Rod Alba with questions.
  • CFPB Issues Fact Sheet on TRID Requirements for Assumptions (5/3/19)
    The Consumer Financial Protection Bureau issued a fact sheet to help lenders determine when the TILA-RESPA integrated disclosures—the Loan Estimate and the Closing Disclosure—are required when mortgages are assumed. The fact sheet addresses TRID requirements when a new consumer is added or substituted as an obligor on an existing closed-end credit transaction secured by real property and that is not a reverse mortgage.
  • OFAC Publishes Framework for OFAC Compliance (5/2/19)
    The U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) on May 2 published "A Framework for OFAC Compliance Commitments." The framework is meant to assist U.S. and foreign entities that conduct business in or with the United States or use U.S.-origin goods or services, with a framework on the essential components of a sanctions compliance program. While OFAC acknowledges that each risk-based sanctions compliance program will vary depending on the company's size and location, each program should have at least five essential components of compliance: management commitment; risk assessment; internal controls; testing and auditing; and training.
  • ABA Comments on CFPB's RFI re: Consumer Credit Card Market (5/1/19)
    ABA, in a comment letter to the Bureau wrote that since the Bureau’s last credit card market report in 2017, credit card interest rates have increased across all tiers as the Federal Reserve Board has raised interest rates. Outdated debt collection rules need to be revised to improve the functioning of the debt collection market and improve consumer understanding and protection. The Bureau is expected to release its report on the credit card market in July 2019. Contact Nessa Feddis with questions.

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April News

  • CFPB Issues Updated Prepaid Small Entity Compliance Guide (4/26/19)
    The Consumer Financial Protection Bureau issued an updated Prepaid Small Entity Compliance Guide reflecting previously issued resources to help prepaid account issuers submit account agreements using Collect, the Bureau's online channel for submissions. The CFPB released resources such as a registration form, user guide, quick reference guide, FAQs, and technical specifications for submissions to the prepaid account agreements database. The resource page also links to a webinar recording on using Collect.
  • CFPB Issues Notice and RFI on Remittance Rule (4/25/19)
    The Consumer Financial Protection Bureau on April 25 issued a Request for Information (RFI) regarding two aspects of the remittance rule. First, the Bureau seeks information related to the scope of coverage of the Rule. Second, the Bureau seeks information regarding the expiration of a temporary exception in the Rule that allows certain insured institutions to estimate the exchange rate and certain fees they are required to disclose when sending remittance transfers. The statutory provision authorizing the temporary exception expressly limits its length and does not provide the Bureau the authority to extend the exception beyond July 21, 2020. Comments on the RFI are due 60 days after publication in the Federal Register.Contact Rob Rowe with questions.
  • Bureau Announces Change Regarding CIDs (4/23/19)
    A year ago this week, ABA submitted its first of 13 comment letters to the CFPB Requests for Information (RFI), which then Acting Director Mulvaney initiated to generate feedback on CFPB policies, procedures and practices. The first RFI requested feedback on the use of Civil Investigative Demands (CID) in enforcement. ABA's comment letter pointed out that while CIDs can be important investigatory tools if carefully used, they can be—and too often were—employed abusively in ways that violate reasonable due process. We urged the CFPB to provide CID recipients more information about the underlying purpose of the CID and the products and services under investigation. This week the CFPB announced it is amending the CID policy to ensure "CIDs will provide more information about the potentially applicable provisions of law that may have been violated. CIDs will also typically specify the business activities subject to the Bureau’s authority." Contact Virginia O'Neill for questions.
  • FDIC to Host Seminars on Deposit Insurance Coverage (4/23/19)
    The FDIC will host four identical seminars on FDIC deposit insurance coverage for bank employees and bank officers between May 15, 2019, and Dec. 9, 2019. The seminars include deposit insurance coverage information on signature card requirements for joint accounts, Prepaid Cards, Bank Trade names, Health Savings Accounts, 529 plan accounts, and 529 Achieving a Better Life Experience (ABLE) plan accounts. Each identical live seminar will last approximately 120 minutes and include a Q&A session with FDIC subject matter experts. The seminars are free, but advance registration is required.
  • Agencies to Host Joint Webinar on Private Flood Insurance Rule (4/22/19)
    The financial regulatory agencies will host a webinar on May 14 on the flood insurance rule issued in February. The rule, which will be effective on July 1, 2019, is the long-awaited implementation of the 2012 Biggert-Waters Act provision that requires federally regulated lending institutions to accept private flood insurance policies that meet certain statutory criteria. The webinar will cover mandatory acceptance of private flood insurance; the mandatory acceptance compliance aid; discretionary acceptance of private flood insurance; flood coverage provided by mutual aid societies; and preparations to comply with the rule.
  • ABA Issues Staff Analysis, Seeks Banker Feedback on Proposed Rule on Regular Rate of Pay (4/19/19)
    ABA has published a staff analysis on the Department of Labor's proposed rule that would clarify which types of compensation must be included in determining an employee’s “regular rate” of pay. Comments on the proposal are due by May 28, 2019. For more information, or to provide feedback, contact ABA's Jonathan Thessin.
  • CFPB Announces Symposium Series (4/19/19)
    CFPB Director Kathleen L. Kraninger announced a symposia series exploring consumer protections in today's financial services marketplace. The series is aimed at stimulating a proactive and transparent dialogue to assist the CFPB in its policy development process, including possible future rulemakings. During each symposium, the Bureau will host a discussion panel of experts with a variety of viewpoints on the topic. The first topic for the symposia series will be around clarifying the meaning of abusive acts or practices. Additional details will be announced at
  • 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.
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  • inger 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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