Compliance Briefing for Friday, September 26, 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.

U.S. Bank pays CMPs and restitution
The OCC has announced Consent Orders for the assessment of a $4 million civil money penalty against U.S. Bank National Association, Cincinnati, Ohio, and restitution of $47.9 million to more than 420,000 consumer accounts. The OCC order also requires the bank to improve its governance of third-party vendors associated with "add-on" consumer products and to submit to the OCC a third-party management program plan for add-on consumer products marketed or sold by the bank or its vendors. The CFPB has issued a separate order against the bank based on unfair billing for identity theft protection products. The CFPB Order required the bank to pay a $5 million civil money penalty and ordered restitution to harmed consumers. Restitution payments made by the bank to those consumers pursuant to the OCC's order will also satisfy identical obligations required by the CFPB action. Consumers eligible for restitution include those who were unfairly billed for identity theft protection products marketed by the bank and sold by its vendor. The restitution ordered will benefit consumers who enrolled in and paid for identity theft protection products between February 2003 and August 2012, but did not receive the full benefit of the products. The restitution will include the full amount paid for these products, plus any associated over-limit fees and finance charges.

Case Study
How Verafin Helped Prevent $547,000 in Losses
This case study highlights how Community Financial Services Bank (CFSB) in Kentucky prevented potential fraud losses of more than $500,000 in just one year with the help of Verafin's FRAML (FRaud detection + AML) software. Before Verafin, CFSB logged everything manually. Now they have a fraud center with Verafin at its core.
— Verafin

CFPB to study early intervention credit counseling
The Bureau has announced Project Catalyst, a CFPB research pilot to assess the potential impact of early intervention credit counseling. Barclaycard (Barclays Bank Delaware) and Clarifi (Consumer Credit Counseling Service of Delaware Valley) have partnered on a pilot program in which Barclaycard will offer cardholders who may need help with managing their credit card debt the opportunity to get help from Clarifi. Cardholders can then choose to enroll in Clarifi's credit counseling services at no cost to them. The information obtained by Barclaycard and Clarifi will be shared with the CFPB. The data will be de-identified (appropriate precautions will be taken to ensure that individual consumers cannot be identified through the data).

AML RightSource
When It Matters

AML RightSource [a Gabriel Partners company] is the leading provider of outsourced AML/BSA compliance services. Our state of the art team of compliance professionals assist clients with Lookbacks and Backlog Remediation, Enhanced Due Diligence Reviews, BSA staffing enhancement / Case Overflow Management, and Total BSA Work Flow Outsourcing. When compliance matters, think AML RightSource.
— AML RightSource

OCC Mortgage Metrics report released
The Second Quarter 2014 Mortgage Metrics Report has been released by the OCC. The report indicates the performance of first-lien mortgages serviced by large national and federal savings banks experienced seasonal decline during the second quarter of 2014, but improved from a year earlier.

UDAAP Compliance Made Easy
The best way to navigate UDAAP compliance is understand your risk. TRUPOINT's UDAAP RiskCheck™ is an easy to use web based tool that makes UDAAP compliance easy. It will provide the answers you need quickly and at a price that makes sense.
— TRUPOINT Partners

Large banks final rules and guidelines
OCC Bulletin 2014-45 has been issued concerning previously announced enforceable final guidelines that establish minimum standards for the design and implementation of a risk governance framework for large insured national banks, insured federal savings associations, and insured federal branches of foreign banks (collectively, banks). The heightened standards guidelines:
  • apply to banks with average total consolidated assets
    • equal to or greater than $50 billion;
    • less than $50 billion, if the bank's parent company controls at least one other covered bank; or
    • less than $50 billion, if the OCC determines that the bank's operations are highly complex or otherwise present a heightened risk that warrants the application of the guidelines.
  • set out the roles and responsibilities for front line units, independent risk management, and internal audit. These organizational units are fundamental to the design and implementation of the framework.
  • provide that a covered bank should have a comprehensive written statement that articulates the covered bank's risk appetite and serves as a basis for the framework (i.e., a risk appetite statement).
  • provide that the board should require management to establish and implement an effective framework that complies with the guidelines and approve any significant changes to the framework.
  • provide that the board should actively oversee a covered bank's risk-taking activities and hold management accountable for adhering to the framework.
  • provide that at least two members of a covered bank's board should be independent.

OCC & CFPB New Third-Party Oversight Requirements:
Using Multiple AMCs?
If you're using multiple AMCs, compliance with new oversight requirements can be difficult or impossible without this framework. Download this free white paper with fourteen recommendations and step-by-step guidelines.
— a la mode

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