Compliance Briefing for Thursday, December 18, 2014

To access specific issuances, go to our Top Stories section, where you'll find links to all the relevant documents.
Risk Scoring — The Essential Element of BSA/AML Compliance

PATRIOT OFFICER automatically calculates risk scores for each customer to identify higher-risk customers and monitors them more closely as the regulations mandate. The solution automatically detects check fraud, check kiting, deposit fraud, ACH fraud, wire fraud, Internet banking fraud, credit/debit card fraud, ATM fraud, employee fraud, and financial fraud to prevent losses. PATRIOT OFFICER is the only BSA/AML/FRAUD solution endorsed by American Bankers Association.
— GlobalVision Systems, Inc.

Bureau sues Texas company for sham credit card
The Consumer Financial Protection Bureau has brought suit against a Texas-based company, Union Workers Credit Services, for deceiving consumers into paying fees to sign up for a sham credit card. The Bureau's complaint alleges that the company falsely advertises a general-use credit card that, in actuality, can only be used to buy products from the company. Union Workers Credit Services also deceptively implies an affiliation with unions by, among other things, using pictures of nurses, firefighters, and other public servants in its advertising, claims the CFPB. The Bureau's lawsuit seeks compensation for victims, a civil penalty, and an injunction against the company.

Complimentary ACAMS On-Demand Webinar:
How Financial Institutions Can Shed Light on Human Trafficking
Chris Swecker (retired Assistant Director, FBI) and Brendan Brothers (Founder, Verafin) discuss the expectations for financial institutions that have resulted from FinCEN's recent advisories related to human trafficking, human smuggling and the use of interstate funnel accounts to launder illegal proceeds.
— Verafin

OFAC: Wait for amendments to Cuba sanctions
A frequently asked question (FAQ) has been posted by OFAC regarding the President's announcement of changes to U.S. policy with respect to Cuba. The essence of the FAQ: Relaxed restrictions will become effective once updated regulations are issued by OFAC and the Commerce Department.

Free eBrief: 2 Free Compliance Essentials for 2015
Prepare for compliance success in 2015 with this free eBrief! We'll share the two things that are essential to achieving your compliance goals, and you'll also get two free worksheets to empower your team. Get your free eBrief today!
— TRUPOINT Partners

FOMC news
The Federal Reserve Board has released the statement and economic projections from the December 16–17, 2014, Federal Open Market Committee meeting.

Fannie Mae's New Collateral Underwriter™ Means Big Changes for Appraisals
Appraisal quality control alert: Fannie Mae announced a new QC review for all appraisals, effective January 26th. Get this Industry Update for the overview, recommendations, and tips for avoiding delays and buybacks.
— Mercury Network

Risk levels at financial institutions increase
The OCC has released its Semiannual Risk Perspective for Fall 2014, which reports that credit risk increased among national banks and federal savings associations during the first six months of 2014. The report cited declining revenues and profitability in OCC-supervised institutions as contributing to the increasing credit risk within the banking sector. The report presents data in five main areas: the operating environment; bank condition; key risk issues; the range of practice in interest rate risk modeling; and regulatory actions. It focuses on issues that pose threats to the safety and soundness of OCC-supervised institutions, and is intended as a resource for the industry, examiners, and the public. The report reflects data as of June 30, 2014.

30 Day Free Trial: Continuous Tracking of IT Assets and Sensitive Data
6 out of 10 financial institutions are unable to find the information they are charged to protect. Do not be the next Chase. You cannot maintain a compliant Information GLBA or Security Program without first knowing where all of your assets are located.
— InfoGPSNetworks

OCC amends subordinated debt rule
The Office of the Comptroller of the Currency has published an interim final rule and request for comments to amend an interim final rule published on February 28, 2014, relating to subordinated debt issued by national banks and federal savings associations. In publishing today's interim rule, the OCC is further clarifying the subordinated debt rules for national banks by moving certain provisions from national bank guidance to the rules and making other clarifying and technical amendments. The rule is effective January 1, 2015, and comments must be received by January 20, 2015.

FREE Customized Fair Lending Desk Audit Using the Latest 2013 HMDA Data
The best way to understand your fair lending risk is a comprehensive peer analysis using the latest 2013 HMDA data. ComplianceTech industry experts will utilize LendingPatterns™, an easy-to-use web-based tool that makes understanding fair lending easy. Click here to request a FREE Fair Lending Desk Audit using the latest 2013 HMDA data.
— Compliance Technologies, Inc.

Guidance for resolution plans of large banks
The FDIC has issued guidance for resolution plans that insured depository institutions with assets greater than $50 billion must submit periodically to the FDIC. These plans are required by an FDIC rule approved in January 2012 and complement those required from certain entities such as covered bank holding companies under the Dodd-Frank Act. The guidance applies to the resolution plans of 36 insured banks that currently meet the criteria, as well as any new institution meeting the threshold, commencing with the 2015 submissions.

NCUA sues trustee banks
The NCUA has filed a complaint in federal court against U.S. Bank National Association and Bank of America, National Association, alleging the banks violated state and federal laws by failing to fulfill their duties as trustees for 99 residential mortgage-backed securities trusts. The complaint states the value of the securities depended on the quality of the pooled mortgage loans the trusts contained, and the banks, as trustees, had contractual and statutory duties to protect the interests of certificate holders. The complaint also states that, despite knowing about defects in the mortgage loans, the defendant banks failed to provide required notices to certificate holders and other parties and failed to take timely action to force the repurchase, substitution or cure of defective mortgage loans or otherwise preserve trust remedies.

Bureau sues Sprint for enabling cramming
The CFPB has filed a suit against Sprint Corporation for allegedly billing wireless consumers tens of millions of dollars in unauthorized third-party charges. The Bureau's complaint alleges that Sprint operated a billing system that allowed third parties to "cram" unauthorized charges on customers' mobile-phone accounts and ignored complaints about the charges. The CFPB seeks refunds for affected consumers and penalties to deter unauthorized third-party charges in the future.

Landline cramming defendant settles with FTC
Cramming was also alleged by the FTC in its charges in American eVoice, Ltd. and Emerica Media Corporation, et al., in which the defendants are alleged to have placing more than $70 million in unauthorized charges on consumers' landline phone bills. Nathan M. Sann, one of the defendants, has agreed to settle the FTC's charges. Sann will be banned from placing charges of any kind on consumers' phone bills. In addition, he will be prohibited from billing consumers for any good or service without their authorization,, and will be required to destroy all personal information that he collected from consumers in connection with the cramming operation within 30 days. The settlement contains a monetary judgment of more than $21 million, which represents the amount of consumer injury attributable to Sann during his involvement with the scam. The judgment will be suspended due to Sann's inability to pay upon his surrender of certain personal assets.

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