Tips from the ToolboxSponsored by: Banker's Toolbox Is the Internal Culture of Compliance at Your Institution Strong Enough to Combat AML Drift?
In August 2014, FinCEN issued guidance encouraging financial institutions to strengthen their internal culture of compliance. The advisory states, "Shortcomings identified in recent anti-money laundering enforcement actions confirm that the culture of an organization is critical to its compliance." What does this mean for your institution? How can you strengthen your internal culture of compliance? For more information on what this means and how you can increase the culture of compliance at your institution,
April 27, 2015
FDIC enforcement actions released
A list of twenty-seven orders and two notices of administrative enforcement actions taken against banks and individuals in March 2015 has been released by the FDIC. The orders included three consent orders, one temporary cease and desist order, six removal and prohibition orders, 11 Section 19 orders, and two civil money penalties. A combined $545,000 civil money penalty (CMP) was issued against four institution-affiliated parties of a failed Colorado bank and a $127.59 CMP was issued against a Wisconsin insured state savings association for late payment of assessments.
HUD changes Distressed Asset Stabilization Program
HUD has announced significant changes to its Distressed Asset Stabilization Program (DASP). Loan servicers will now be required to delay foreclosure for a year and to evaluate all borrowers for the Home Affordable Modification Program (HAMP) or a similar loss mitigation program. Additional improvements to the Neighborhood Stabilization Outcome (NSO) sales portion of DASP are aimed at increasing non-profit participation. They include giving non-profits a first look at vacant properties, allowing purchasers to re-sell notes to non-profits, and offering a non-profit only pool.
April 24, 2015
FDIC launches Money Smart for Young People
The FDIC has launched Money Smart for Young People, a series of lesson plans for teachers and new resources for parents to help them teach children about managing money. The free resources are designed to improve financial education and decision-making skills among young people from pre-K through age 20. The FDIC worked in partnership with CFPB to develop these educational tools. The series features four curricula tailored for different age groups and abilities. Teachers can access this curriculum and videos that demonstrate how financial education concepts can be taught in the classroom at https://www.fdic.gov/consumers/education/torc/ and http://www.consumerfinance.gov/parents/. FDIC Chairman Gruenberg and CFPB Director Cordray commented on the launch of the series in their remarks at the Jump$tart Coalition National Partners Meeting in Washington, D.C.
FDIC publishes restrictions on sale of failed bank assets
The Federal Deposit Insurance Corporation has published [80 FR 22886] a final rule amending its regulations at 12 CFR Part 340 (Restrictions on Sales of Assets by the Federal Deposit Insurance Corporation) to clarify the purpose, scope and applicability of that rule and to make that rule more consistent with the FDIC's rule concerning restrictions on the sale of assets of a covered financial company under the Dodd-Frank Act.
March residential housing report mixed
HUD and the Census Bureau have released the March 2015 Residential Sales Report. Sales of new single-family houses in March 2015 were at a seasonally adjusted annual rate of 481,000, which was 11.4 percent below the revised February rate of 543,000 but 19.4 percent above the March 2014 estimate. The median sales price of new houses sold in March 2015 was $277,000 and the average sales price was $343,300. The seasonally adjusted estimate of new houses for sale at the end of March was 213,000. This represents a supply of 5.3 months at the current sales rate.
Among several topics addressed in her testimony before the House Subcommittee on Financial Institutions and Consumer Credit, Doreen R. Eberley, FDIC Division of Risk Management Supervision Director, reported that the agency, working with the FFIEC, plans to propose certain burden-reducing changes this year and implement a more robust process for bank agency users to justify retaining or adding items to the Call Report.
Deletions from the OFAC List
OFAC has announced the removal of several entries with the BURMA designation from the SDN List.
Ohio CU enters conservatorship
The NCUA has announced that the Superintendent of the Ohio Division of Financial Institutions has placed Montgomery County Credit Union, Inc., Dayton, Ohio, into conservatorship after the discovery of unsafe and unsound practices, and appointed the NCUA as agent for the conservator. The credit union has 6,605 members and $27.3 million in assets. An FAQ has been posted by the NCUA concerning the conservatorship.
NCUA Board meeting agenda
The agenda for the April 30, 2015, meeting of the NCUA Board has been posted.
April 23, 2015
SEC whistleblower award
A compliance officer has been awarded more than $1.4 million for providing information that assisted the SEC in an enforcement action against the tipster's company. The unnamed compliance officer "reported misconduct after responsible management at the entity became aware of potentially impending harm to investors and failed to take steps to prevent it," said Andrew Ceresny, Director of the SEC's Division of Enforcement. This is the second award the SEC has made to an employee with internal audit or compliance responsibilities. By law, the SEC must protect the confidentiality of whistleblowers and cannot disclose information that might directly or indirectly reveal their identities.
FHFA statement on HOA super-priority liens
The Federal Housing Finance Agency (FHFA), in its role as Conservator of Fannie Mae and Freddie Mac, has issued a statement reminding those concerned that Federal law precludes involuntary extinguishment of Fannie Mae or Freddie Mac liens while the GSEs are under the conservatorship, and preempts state laws that would allow homeowners' association liens to defeat a Fannie Mae or Freddie Mac lien or other property interest. The statement reiterated the FHFA's intention to contest HOA foreclosures that threaten the GSEs' property interests.
House prices rise
The FHFA has released its House Price Index (HPI) for February 2015. U.S. house prices for the month were up 0.7 percent on a seasonally adjusted basis from January. From February 2014 to February 2015, house prices were up 5.4 percent.
OCC Risk Workshops in Detroit
The OCC will host two workshops in Detroit on June 2-3, for directors of national community banks and federal savings associations. The Risk Governance workshop on June 2 combines lectures, discussion, and exercises to provide practical information for directors to effectively measure and manage risks. The workshop also focuses on the OCC's approach to risk-based supervision and major risks in the financial industry. The revised and updated Credit Risk workshop on June 3 focuses on credit risk within the loan portfolio, such as identifying trends and recognizing problems. The workshop also covers the roles of the board and management, how to stay informed of changes in credit risk, and how to effect change.
NCUA reschedules closed meeting
The NCUA Board members have agreed to reschedule the closed Board meeting set for Thursday, April 30, 2015, to Wednesday, April 29, beginning at 2:30 p.m. The agenda for the closed Board meeting has been posted.
CFPB expands the Your Money, Your Goals toolkit
The Consumer Financial Protection Bureau has posted an article to announce the release of three new versions of the CFPB "Your Money, Your Goals" toolkit designed to assist training efforts by organizations that engage volunteers, legal aid organizations, and workers organizations. The new toolkits also contain additional resources including an implementation guide and presentation slides with trainer notes. The CFPB is teaming up with sites in 31 communities across 19 states to deliver workshops to community volunteers, legal aid staff, and other organizations that work with low-income consumers. These programs will enable organizations to train an additional 1,000 staff and volunteers this summer.
SAR Stats updated
FinCEN has issued the April 2015 SAR Stats quarterly update, which provides information on Suspicious Activity Reports (SARs) filed through March 31, 2015.
April 22, 2015
FinCEN issues Miami GTO
The Financial Crimes Enforcement Network (FinCEN) announced yesterday that it has issued a Geographic Targeting Order (GTO) to about 700 Miami, Florida, businesses to shed light on cash transactions that may be tied to trade-based money laundering schemes. These complex schemes are a primary method used by drug cartels, including the Sinaloa and Los Zetas organizations, to launder their illicit proceeds. FinCEN's order is aimed at disrupting the illicit financial infrastructure upon which these drug trafficking organizations rely. The GTO, which will be in effect for 180 days beginning on April 28, 2015, lowers the $10,000 reporting threshold to $3,000 for covered businesses, identified by FinCEN as electronics exporters located near Miami.
Bureau and FTC penalize mortgage servicer
Green Tree Servicing, LLC will pay $63 million to settle FTC and CFPB charges that it harmed homeowners with illegal loan servicing and debt collection practices, according to the CFPB's press release on the settlement. In their complaint, the agencies allege that Green Tree made illegal and abusive debt collection calls to consumers, misrepresented the amounts people owed, and failed to honor loan modification agreements between consumers and their prior servicers, among other charges. Under the proposed settlement, Green Tree will pay $48 million to affected consumers and a $15 million civil penalty to the Bureau. The company also will stop its alleged illegal practices, create a home preservation plan for some distressed homeowners, and take rigorous steps to ensure that it collects the correct amounts from consumers. It will also honor loss mitigation agreements entered by prior servicers, and continue processing lending loss mitigation requests received in the transfer of loans from a prior servicer.
Institutions to be liable for incorrect ACH data
Treasury has announced the Bureau of the Fiscal Service will begin holding financial institutions liable for providing incorrect automated clearing house (ACH) enrollment information to a Federal agency resulting in an erroneous or fraudulent payment and subsequent loss to the Government. Liability will imposed if Treasury determines that enrollment information or a correction entry forwarded by the institution included erroneous information. The updated Green Book section on the Reclamation Procedures for Erroneous Enrollments provides more information.
OFAC designates Japanese syndicate and chairman
Kodo-kai, a major second-tier affiliate of the Yamaguchi-gumi, the largest and most prominent Japanese Yakuza syndicate, and its chairman, Teruaki Takeuchi have been designated by OFAC under an Executive Order 13581, which targets significant transnational criminal organizations (TCOs) and their supporters. In the U.S., the Yakuza has been involved in drug trafficking and money laundering. Including this action, OFAC has designated 13 senior Yakuza members and five Yakuza entities – the Yamaguchi-gumi, Sumiyoshi-kai, Inagawa-kai, Kudo-kai, and Kodo-kai. The designation of the Kodo-kai marks the first time a second-tier Yakuza affiliate has been targeted. Additional information is available in OFAC's April 21, 2015, SDN List update.
Proposed recordkeeping standards for big banks
An advanced notice of proposed rulemaking (ANPR) has been issued by the FDIC seeking input on potential new recordkeeping standards for a limited number of FDIC-insured institutions with a large number of deposit accounts. In its press release, the FDIC emphasized that it does not expect that any of the responsibilities discussed in the proposal would apply to community banks and suggested a threshold for inclusion could be more than 2 million deposit accounts at an institution. Chairman Gruenberg also issued a statement about the ANPR. Comments on the ANPR will be accepted for 90 days following its publication in the Federal Register.
Nonprofit counselors to provide consumer credit scores
The CFPB Blog features an article announcing that new agreements between the Fair Isaac Corporation (FICO) and the three large credit reporting agencies (TransUnion, Equifax, and Experian) will allow millions of consumers who receive nonprofit credit counseling, housing counseling, and other services to obtain a copy of the FICO score that these organizations have purchased. Prior to the new agreements, counseling organizations have generally been prohibited by their contracts with the credit reporting agencies from giving a consumer the credit report or score that they have purchased on the consumer's behalf. The Bureau reports that Experian is updating its policy so that nonprofit counselors will soon be able to share its reports.
April 21, 2015
Bureau acts against military allotment processor
The Consumer Financial Protection Bureau announced on Monday it had taken action against Fort Knox National Company (a Kentucky corporation) and its subsidiary, Military Assistance Company, LLC (a Kentucky limited liability company) for unfair, deceptive and abusive practices in charging servicemembers millions of dollars in hidden fees. The military allotment processor did not clearly disclose various recurring fees, which could total $100 or more. Under a consent order entered into with the Bureau, the companies will pay about $3.1 million in relief to harmed servicemembers. Servicemembers who may be eligible for relief will be contacted by the Bureau.
FDIC seeks youth savings pilot phase II applications FDIC FIL-18-2015, issued yesterday, announces the agency is seeking applications from institutions for Phase II of its Youth Savings Pilot, a program designed to foster financial education through the opening of safe, low-cost savings accounts by school-age children. These banks should be interested in expanding existing youth savings programs or developing new programs during the upcoming (2015-2016) school year.
EEOC proposes changes to wellness program regs
The Equal Employment Opportunity Commission has published a proposed rule [80 FR 21659] that would amend regulations and guidance under Title I of the Americans with Disabilities Act (ADA) as they relate to employer wellness programs. The proposed rule amends the ADA regulations to provide guidance on the extent to which employers may use incentives to encourage employees to participate in wellness programs that include disability-related inquiries and/or medical examinations. Comments on the proposal are due by June 19, 2015.
Communities to be suspended from flood program
Communities in Indiana, Iowa, Minnesota, Montana, Ohio, Virginia, Washington, and Wyoming are included in a list published in a final rule by the Federal Emergency Management Agency in today's Federal Register [80 FR 22116]. The rule identifies communities where the sale of flood insurance has been authorized previously under the National Flood Insurance Program (NFIP) that are scheduled for suspension on May 18, 2015, because of noncompliance with the floodplain management requirements of the program.
Interpretive rule on counseling lists published
The CFPB's updated interpretive rule on the provision of lists of homeownership counseling organizations, announced in our April 16, 2015, Top Stories, has been published in the Federal Register [80 FR 22091] and is now effective.
April 20, 2015
OCC enforcement actions
The OCC has released new enforcement actions recently taken against national banks, federal savings associations, and individuals currently and formerly affiliated with national banks and federal savings associations. Information regarding a $16,700 Flood Act CMP included in the OCC's list has been posted on the BOL Flood Penalties Watch page. The list also includes a Consent Order for a $1 million CMP against a Texas bank, details of which will be posted to BOL's BSA/AML Penalties page.
Revised private mortgage insurance eligibility requirements
The Federal Housing Finance Agency (FHFA) has announced that Fannie Mae and Freddie Mac are issuing revised requirements for private mortgage insurance companies that insure mortgage loans either owned or guaranteed by the two government sponsored entities. The revised eligibility requirements set financial and operational standards that private mortgage insurers must meet to receive approved insurer status with Fannie or Freddie and are designed to reduce their risk. The requirements are effective December 31, 2015.
Guarantee fees largely unchanged
The results of a comprehensive review of guarantee fees charged by Fannie Mae and Freddie Mac have been announced by the Federal Housing Finance Agency (FHFA). The review indicated that current fees, on average, are at an appropriate level and that some modest adjustments to upfront guarantee fees are also appropriate. A Fact Sheet with more information was also released.
FOMC historical materials released
The FRB has released materials regarding the agendas of the 2009 meetings and the SEP Individual Projections of the Federal Open Market Committee.
CFPB announces Consumer Finance Research Conference
An invitation was posted on the CFPB Blog to attend its research conference on May 7-8, 2015, which will be focused on high-quality consumer finance research, with academic and government researchers presenting their research papers.
Central American gang members designated
OFAC also announced the designation of three members of the notorious Central American gang known as the Mara Salvatrucha (MS-13) under Executive Order (E.O.) 13581, which targets transnational criminal organizations (TCOs) and their supporters. The individuals designated today are Salvadoran nationals José Luís Mendoza Figueroa, Eduardo Erazo Nolasco, and Élmer Canales Rivera. Information regarding the new designees is available in an OFAC Update.
NMLS Mortgage Industry report
The NMLS has released its 2014 NMLS Mortgage Industry Report, which provides analysis of the mortgage entities who were licensed or registered through NMLS in 2014.
Brokered deposits information call
FDIC FIL-17-2015 has announced an informational call for FDIC-insured institutions on April 22, 2015, at 1:00 p.m. EDT to discuss the Brokered Deposit Frequently Asked Questions (FAQs) previously issued in FIL-2-2015. During this call, FDIC staff will discuss and respond to questions received about the FAQs, which provide guidance on identifying brokered deposits, accepting deposits, listing services, and other brokered deposit-related matters.
April 16, 2015
CFPB updates interpretive rule on homeowner counseling lists
The Consumer Financial Protection Bureau has announced a final interpretive rule restating and expanding upon its November 2013 guidance on how to provide mortgage applicants with a list of local homeownership counseling organizations. The updated rule provides further guidance for lenders who are building their own lists of housing counselors. The rule also includes guidance on the qualifications for providing high-cost mortgage counseling and for lender participation in such counseling. Other specific additions include new instructions about:
how to provide applicants abroad with homeownership counseling lists;
permissible geolocation tools;
combining the homeownership counseling list with other disclosures;
use of a consumer's mailing address to provide the list; and
high-cost mortgage counseling qualifications and lender participation in such counseling.
The updated rule will become effective when it's published in the Federal Register.
Final rule to suspend submission of credit card agreements
The Bureau also announced that it has approved a final rule that temporarily suspends a requirement that each quarter certain credit card issuers send their agreements to the Bureau, which publishes them in a public database on its website. Other requirements, including card issuers' obligations to post these agreements on their own publicly available websites, will remain unaffected by this rule. The submissions are to be suspended to make it easier for the Bureau to improve the database and streamline the data submission process. The suspension affects submissions that would otherwise be due to the Bureau by the first business day on or after April 30, 2015, July 31, 2015, October 31, 2015, and January 31, 2016. [Note: The rule was published on April 17, 2015, at 80 FR 21153, and is effective upon publication.]
Regulation D tweak comment period
With the publication at 80 FR 20448 in this morning's Federal Register of the Federal Reserve Board's proposal to tweak its Regulation D (Top Stories, April 14, 2015), the due date for comments has been established as May 18, 2015.
OFAC settles with First Data on sanctions violations
OFAC has announced that First Data Resources, LLC (First Data), of Atlanta, Georgia, has agreed to pay $23,336 to settle potential civil liability for alleged violations of the Foreign Narcotics Kingpin Sanctions Regulations. The alleged violations involve First Data's provision of third party data processing services to a Specially Designated Narcotics Trafficker. OFAC determined that First Data voluntarily self-disclosed the alleged violations, which constitute a non-egregious case. The total transaction value for the alleged violations was $69,144 and the base penalty amount was $34,572.
OCC Trade Finance and Services booklet revised
OCC Bulletin 2015-26 announces the issuance of a revised "Trade Finance and Services" booklet of the Comptroller's Handbook. The revision replaces the "Trade Finance" and "Bankers' Acceptance" booklets issued in November 1996 and section 215, "Letters of Credit," issued in January 1994 as part of the former Office of Thrift Supervision's examination handbook.
NMLS down time announced
The NMLS has posted a notice that NMLS and Consumer Access will be unavailable from 9:00 p.m. ET Friday, April 17th until Saturday afternoon, April 18th while system enhancements are completed.
Notice of FDIC board meeting
The Sunshine Act meeting notice for the April 21, 2015, meeting of the FDIC Board of Directors has been posted.
February TIC data released
Treasury has released Treasury International Capital (TIC) data for February 2015. The sum total in February of all net foreign acquisitions of long-term securities, short-term U.S. securities, and banking flows was a monthly net TIC inflow of $4.1 billion. Of this, net foreign private outflows were $7.2 billion, and net foreign official inflows were $11.3 billion.
April G.17 report released
The Federal Reserve Board has released the April 15 G.17 Industrial Production and Capacity Utilization Report. Industrial production decreased 0.6 percent in March after increasing 0.1 percent in February. For the first quarter of 2015 as a whole, industrial production declined at an annual rate of 1.0 percent, the first quarterly decrease since the second quarter of 2009.
April Beige Book
The Board has also posted the April 15, 2015, issue of the Beige Book. Reports from the twelve Federal Reserve Districts indicate that the economy continued to expand across most regions from mid-February through the end of March. Activity in the Richmond, Chicago, Minneapolis, Dallas, and San Francisco Districts grew at a moderate pace, while New York, Philadelphia, and St. Louis cited modest growth. Boston reported that business activity continues to expand, while Cleveland cited a slight pace of growth. Atlanta and Kansas City described economic conditions as steady.
April FedFlash posted
Federal Reserve Bank Services has posted the April 2015 issue of FedFlash, which features articles on:
proposed amendments to Reg D
commercial check and ACH posting rule changes
new FedReceipts RTNs to be published
alert criteria set-up availability for new FedACH Risks RDFI Alert customers
April 15, 2015
Bureau and Navajo Nation halt tax-refund scam
The CFPB has announced that it has joined the Navajo Nation to take action against companies and individuals who operated an illegal tax-refund scheme. According to a complaint filed in federal court, Jeffrey Scott Thomas and Dennis Gonzales operated S/W Tax Loans, Inc. to offer Thomas's low-income tax-preparation clients (many of whom are citizens of Navajo Nation) refund-anticipation loans with triple-digit APRs. Thomas and his tax preparation franchises then illegally steered clients to S/W, where the estimated APRs for the loans were significantly understated. S/W arranged to have refunds routed to itself, and failed to credit many of those refunds to outstanding anticipation loans, convincing clients to renew the loans (compounding the impact of the finance charges) while retaining the refunds. A proposed order, if approved by a federal court, would
ban the individuals for five years from offering financial products associated with tax refunds, and from investing, financing, or working for any entity offering such products.
Provide full refunds of interest and fees, in an amount of $254,267, which is in addition to approximately $184,000 already refunded to consumers
Impose civil penalties of $438,000
Leader and key supporter of Yemen rebels designated
Treasury has announced the sanctioning of the leader of the Houthi movement (also known as Ansar Allah), Abdul Malik al-Houthi, and a key supporter of the Houthis, Ahmed Ali Saleh, for being a political or military leader of a group that has engaged in acts that directly or indirectly threaten the peace, security, or stability of Yemen and for engaging in such acts, respectively. Their names have been added to the SDN List. The OFAC action complements the United Nations Security Council (UNSC) action to sanction the two individuals. In an unrelated action, OFAC has also added the name of an individual from Tunisia to the SDN List.
NCUA reschedules webinar
The NCUA has announced its Grant Initiatives webinar, originally scheduled for today, has been rescheduled for April 28 at 2 p.m. EDT.
Handbook RESPA booklet revised
The OCC has issued Bulletin 2015-25 announcing the issuance of a revision of the "Real Estate Settlement Procedures Act" booklet of the Comptroller's Handbook. The revised booklet replaces a similarly titled booklet issued in October 2011 and provides updated information resulting from recent changes made to Regulation X. Highlights include:
transfer of rulemaking authority for Regulation X from the HUD to the CFPB.
new requirements relating to mortgage servicing.
new loss mitigation procedures.
new prohibitions against certain acts and practices by servicers of federally related mortgage loans with regard to responding to borrower assertions of error and requests for information.
new examination procedures for determining compliance with the new requirements relating to mortgage servicing.
Florida man forfeits $44M and 9 years of freedom for bank fraud
U.S. Immigration and Customs Enforcement (ICE) has announced that Pedro "Pete" Benevides, of Astatula, Florida, has been sentenced to nine years in federal prison for bank fraud conspiracy and ordered to forfeit more than $40 million in cash and two exotic sports cars. He will also be ordered to pay full restitution to the financial institutions that were the victims of his offense. Benevides obtained 20 commercial and residential loans and lines of credit from several federally-insured financial institutions by providing documents to the lenders that contained false information concerning his income and assets or the business that he used to obtain the loans and lines of credit.
Discount rate meeting minutes
The minutes of the discount rate meetings from February 9 through March 16, 2015, have been released by the Federal Reserve Board.
April 14, 2015
Board proposes Reg D technical change
The Federal Reserve Board has requested comments on proposed amendments to Regulation D (Reserve Requirements of Depository Institutions) so that interest payments to depository institutions with excess balances are based on the rate of interest paid on excess balances (the IOER rate) in effect each day and the level of balances held each day, rather than the average IOER rate and average level of excess balances over the maintenance period. Comments on the proposal are requested within 30 days of publication in the Federal Register, which is expected shortly.
Debt brokers settle FTC charges
The FTC has announced that two debt brokers have agreed to settle charges that they exposed highly sensitive information about tens of thousands of consumers while trying to sell portfolios of consumer debt on a public website. In separate cases filed last year against Cornerstone and Company, LLC and its owner, Brandon Lambert; and Bayview Solutions, LLC and its owner, Aron Tomko, the FTC alleged the debt brokers posted unencrypted documents online containing consumers' names, addresses, credit card numbers, bank account numbers, and amounts the consumers allegedly owed. The sensitive data was accessible to anyone with an internet connection. The FTC also posted seven tips for keeping data secure when buying or selling debts.
OFAC amends Syria Sanctions regulations
The Department of the Treasury's Office of Foreign Assets Control (OFAC) has amended the Syrian Sanctions Regulations at 31 CFR Part 542 to authorize certain activities related to publishing not already exempt that support the publishing and marketing of manuscripts, books, journals, and newspapers. The amendments, published in yesterday's Federal Register [80 FR 19532], are effective immediately.
April 13, 2015
Fake debt collection scam
The Federal Trade Commission and the Illinois Attorney General have announced they have obtained a federal court order temporarily halting the activities of K.I.P, LLC, an Illinois debt collection agency. According to the complaint filed by the FTC and the Illinois AG, since at least 2010, the defendants used a host of business names to target consumers who obtained or applied for payday or other short-term loans, pressuring them into paying debts that they either did not owe or that the defendants had no authority to collect. Consumers were threatened that the company would:
Garnish consumers' wages,
Suspend or revoke their driver's licenses,
Have them arrested or imprisoned, or
File a lawsuit against them.
Complaint temporarily halts mortgage relief company
Another FTC-requested federal court order has temporarily halted the offering of mortgage relief services by Wealth Education, Inc., of Los Angeles, California. The Commission's complaint charged the defendants with failing to provide the help they promised homeowners, while charging a hefty up-front fee ($1,000 - $5,000). The company also told consumers to stop making their monthly mortgage payments, leading some to the brink of foreclosure.
NMLS releases mortgage report
The Fourth Quarter 2014 NMLS Mortgage Industry Report has been released. The report contains an analysis of companies, branches, and mortgage loan originators who were licensed or registered through NMLS in order to conduct mortgage activities. The NMLS also posted an update to its Money Services Business Fact Sheet. The NMLS manages licensing services for MSBs and many other industries on behalf of its state members.
CFPB announces Academic Research Council annual meeting
A "Save-the-Date" invitation has been posted on the CFPB Blog for the annual meeting of the Academic Research Council to be held on May 7 from 9 to 12 p.m. EDT at the U.S. Bureau of Engraving and Printing in Washington, D.C. The meeting will discuss trends in consumer finance research, the activities of consumer financial protection agencies in other countries, recent publications produced by CFPB's Office of Research, and remarks from Director Cordray. An agenda and an event flyer were also posted.
April 10, 2015
Deceptive ads cost mortgage lender $250,000
The CFPB has announced it has issued a Consent Order and imposed a $250,000 civil penalty against RMK Financial Corporation, a California based mortgage lender, for deceptive mortgage advertising practices, including ads that led consumers to believe that the company was affiliated with the U.S. government. RMK mailed print advertisements to more than 100,000 consumers in several states, using the names and logos of the Department of Veterans Affairs (VA) and the Federal Housing Administration (FHA) in a way that falsely implied that the advertisements were sent by the agencies, or that the company or the advertised mortgage products were endorsed or sponsored by the VA or FHA. RMK also sent its advertisements to tens of thousands of U.S. military servicemembers and veterans, and other holders of VA-guaranteed mortgages. The CFPB's investigation found that RMK's practices violated the Truth in Lending Act, the Mortgage Acts and Practices Advertising Rule, and other federal consumer laws. The CFPB also posted an article advising consumers that the VA does not send out mortgage ads.
Small Bank Holding Company Policy Statement expanded
The Federal Reserve Board has issued a final rule to expand the applicability of its Small Bank Holding Company Policy Statement and to apply it to certain savings and loan holding companies. The policy statement facilitates the transfer of ownership of small community banks and savings associations by allowing their holding companies to operate with higher levels of debt than would normally be permitted. The final rule raises the asset threshold of the policy statement from $500 million to $1 billion in total consolidated assets. The final rule implements a law passed by Congress in December 2014 and will be effective 30 days after publication in the Federal Register.
TRID preparedness survey
How far along is your bank in preparing for compliance with the TILA/RESPA Integrated Disclosures (TRID) Rules? Let us know in our anonymous poll in BOL's Bankers' Threads. Contribute to the poll results and you can see how others say they are doing. And we'll share the results at our fast-approaching TRID-immersion Loan Compliance Triage Conference in Santa Fe (and online) on April 28 and 29.
OFAC Spring Symposium
OFAC has issued an invitation to join its 2015 Spring Symposium for a comprehensive review of OFAC and current U.S. economic sanctions. The event will be held on May 11, 2015, from 8 a.m. to 5 p.m. EDT in Washington, DC, and will include presentations on OFAC regulations affecting all U.S. persons, as well as targeted reviews of sanctions concerns for new and updated OFAC programs. In addition to formal presentations, OFAC staff will be available throughout the day to answer questions on issues unique to a number of regulated industries.
OCC Mutual Savings Association Advisory Committee meeting
The OCC has announced it will host a public meeting of the Mutual Savings Association Advisory Committee (MSAAC) on Tuesday, April 28, 2015, beginning at 8:00 a.m. EDT at its Washington office. The purpose of the MSAAC meeting is to advise the OCC on the regulatory changes or other steps the OCC may be able to take to ensure the continued health and viability of mutual savings associations and other issues of concern to mutual savings associations.
April 9, 2015
Mexican drug organizations and leaders designated
Treasury has announced the designation of two Mexican narcotics trafficking organizations, the Cartel de Jalisco Nueva Generacion (CJNG) and the Los Cuinis Drug Trafficking Organization (DTO), as Specially Designated Narcotics Traffickers (SDGTs) under the Foreign Narcotics Kingpin Designation Act (Kingpin Act). Also designated were Nemesio Oseguera Cervantes and Abigael Gonzalez Valencia, who are leaders of CJNG and the Los Cuinis DTO, respectively.
Counterfeit cashier's checks alert
The OCC has issued Alert 2015-5 reporting counterfeit cashier's checks using the correct routing number of Bridgehampton National Bank, Bridgehampton, NY. Information about the counterfeit checks has been posted to the BOL Alerts and Counterfeits page.
Robocalling debt collectors sued by CFPB
A lawsuit has been filed in federal court by the Consumer Financial Protection Bureau against the ringleaders of a robocall phantom debt collection operation, their companies, and their service providers. The complaint alleges debt collectors, using various aliases, deployed automated calls to threaten, harass, and deceive consumers in attempts to collect debt the consumers did not owe to them, and in most instances, to anyone else. The complaint also alleges that the scheme depended on the participation of the telemarketing company that sent the robocalls and payment processors that allowed the collectors to access consumers' bank accounts.
Financial literacy webinar and chat
The NCUA has announced it will host a free webinar, "Your Mission in Action: Developing Youth Financial Literacy and Savings Programs," on April 22, 2015, from 2–3:30 p.m. EDT. A Twitter chat is scheduled to begin at 11 a.m. EDT.
Bureau launches nationwide effort to promote financial education in schools
The CFPB has announced the launch of a nationwide effort to advance financial education in schools. A resource guide, "Advancing K-12 Financial Education: A Guide for Policymakers," has been published, providing strategies for furthering the development and implementation of financial education in states.
April 8, 2015
Joint action against terrorist financing trust
The Department of the Treasury has announced that the United States and the Kingdom of Saudi Arabia have jointly taken action to disrupt the financing and operations of Al-Furqan Foundation Welfare Trust (Al-Furqan), which is the successor entity to the Afghan Support Committee (ASC) and Revival of Islamic Heritage Society branches in Pakistan and Afghanistan (RIHS-Pakistan). Both were designated as Specially Designated Global Terrorists (SDGT) and listed on the United Nations al-Qaida Sanctions List in 2002. Treasury has updated the existing SDGT designations to reflect the name change. The Kingdom of Saudi Arabia has designated Al-Furqan under its Law of Terrorism Crimes and Financing and the Royal Decree A/44. In an unrelated action, OFAC deleted the names of six entities related to the Afghan Support Committee from the SDN List.
Consumer credit report
The G.19 Consumer Credit Outstanding and Terms of Credit report for February 2015 has been released by the Federal Reserve Board. Consumer credit increased at a seasonally adjusted annual rate of 5½ percent. Revolving credit decreased at an annual rate of 5 percent, while nonrevolving credit increased at an annual rate of 9½ percent.
April 7, 2015
FAQ on regulatory capital
Federal Reserve Board SR-15-6 and FDIC FIL-16-2015 have been issued to announce the issuance of Frequently Asked Questions (FAQs) on the Regulatory Capital Rule. The FAQs are posted on the agencies' respective websites: FRB; FDIC.
New SDN List format
OFAC has announced the release of the Specially Designated Nationals (SDN) list in an XML data format that is based on the United Nations 1267/1988 Committee's Advanced Sanctions Data Model. This format gives sanctions lists new capabilities and will aid list users in executing their compliance obligations. FAQs on the new format was also released.
EGRPA outreach meetings scheduled
The federal banking agencies have announced they will hold an outreach meeting on May 4, 2015, at the Federal Reserve Bank of Boston as part of their regulatory review under the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA). The meeting is the third in a series of outreach sessions that the FRB, the OCC, and the FDIC are holding throughout the country. Additional meetings are currently scheduled on August 4, 2015, in Kansas City, Missouri (focusing on rural banking issues); on October 19, 2015, in Chicago, Illinois; and on December 2, 2015, in Washington, D.C. All outreach meeting may be viewed live online. Details on the Boston meeting, including registration information, the webcast link, and the agenda, are available on the EGRPRA website.
CRA ratings released
The OCC has released the ratings received by 26 national banks and federal savings associations recently evaluated for compliance with the CRA. Five institutions were rated Outstanding, 20 rated Satisfactory, and one was rated Needs to Improve.
Call Report FIL
The FDIC has issued FIL-15-2015 regarding instructions for completing the March 31, 2015, Call Report, which must be received by regulators by April 30, 2015. Changes include:
The completion of revisions to Schedule RC-R, Regulatory Capital, to achieve consistency with the revised regulatory capital rules adopted in July 2013.
Implementation of the revised definitions of the regulatory capital components in Schedule RC-R, Part I, including an item for making the one-time, permanent election to calculate regulatory capital using the treatment for accumulated other comprehensive income permitted in the general regulatory capital rules prior to January 1, 2015.
Incorporation of the standardized approach for calculating risk-weighted assets in Schedule RC-R, Part II, including a greater number of risk-weight categories and new risk-weighting approaches for certain types of exposures.
A revision to the reporting of securities borrowed in Schedule RC-L, Derivatives and Off-Balance Sheet Items.
New Memorandum items in Schedule RI, Income Statement, for three categories of service charge income earned on consumer deposit account products by those institutions with $1 billion or more in assets that offer such deposit products.
Call Report forms and an instruction book update are available on the FDIC's website.
Mortgage and debt relief marketers banned
The Federal Trade Commission has announced a court settlement, including a ban from the mortgage relief and debt relief industries, with Linden Financial Group LLC, related individuals, and entities. A complaint filed by the Commission in 2014 alleged the defendants lured consumers into paying $500 to $3,900 by falsely promising that attorneys would negotiate loan modifications that would substantially reduce the consumers' mortgage payments. In February 2015, the FTC announced settlements with the other individual and corporate defendants in this case that resulted in orders which ban the defendants from offering mortgage assistance relief services and from participating in the debt relief industry.
CRA ratings released
The FDIC has released its April list of the ratings received by sixty-seven state nonmember banks recently examined for CRA compliance. Three banks were rated Outstanding, sixty-three rated Satisfactory, and one rated Needs to Improve.
New OCC subordinated debt guidelines
The OCC's April 3, 2015, Bulletin 2015-22 announces the revision and reorganization of the agency's current guidance for subordinated debt issued by national banks (at appendix A of the "Subordinated Debt" booklet of the Comptroller's Licensing Manual). It has been replaced with new "Guidelines for Subordinated Debt." The OCC also revised the "Sample Subordinated Note" (at appendix B of the "Subordinated Debt" booklet) and replacing it with two sample notes. One is for subordinated debt to be included in Tier 2 capital; the other provides sample language for subordinated debit not to be counted as Tier 2 capital.
April 3, 2015
Retirement plan guidance from Treasury and IRS
The Treasury Department and the IRS have issued Guidance designed to facilitate automatic enrollment and contribution increases in 401(k) and similar retirement savings plans. This guidance adds to the current IRS self-correction program, which allows plan sponsors to easily correct administrative errors without risking a plan's tax qualification and without having to obtain IRS approval. The correction safe harbor for plans with automatic contribution features requires the plan sponsor to make all employer matching contributions that should have been made with respect to the missed employee contributions, and to contribute an additional amount to make up for the earnings that should have accrued under the plan on those matching contributions.
Curry on efforts to strengthen community banking
In remarks before the Depositors Insurance Fund (the Massachusetts thrift deposit insurance program covering non-FDIC insured balances), Comptroller Curry discussed efforts to strengthen community banking through expanding flexibility of the federal thrift charter, reducing unnecessary burden in the regulatory process for community banks, encouraging collaboration, and enhancing institutions' readiness to withstand cyber threats. Curry was formerly the Commissioner of Banks in Massachusetts.
Yellen on economic mobility
Federal Reserve Board Chair Yellen delivered the opening remarks at "Economic Mobility: Research and Ideas on Strengthening Families, Communities, and the Economy," a community development research conference in Washington, D.C. sponsored by the Federal Reserve System. She noted, "According to a recent Pew Research Center survey, the gap between rich and poor now ranks as a major concern in the minds of citizens around the world. In advanced economies still feeling the effects of the Great Recession, people worry that children will grow up to be worse off financially than their parents were. In the United States, roughly 80 percent of Americans across the ideological spectrum see inequality as a moderately big or very big problem." She also commented, "There are important research questions to be answered about the relationship between economic mobility and the economy as a whole. It seems obvious that greater economic opportunity and mobility promotes a healthier economy. Entrepreneurship, innovation, and hard work—surely key contributors to individual mobility—are central to a strong economy as well. But research could help us better understand how much mobility at the individual level matters for overall growth in productivity and economic output."
NCUA Board meeting livestream registration
The NCUA has announced that registration is open for the free online livestreaming of its April 30 open Board meeting. The meeting is scheduled to begin at 10 a.m. ET. Board meeting agendas are posted on the Board calendar webpage at 3 p.m. ET one week prior to each meeting.
April 2, 2015
Exam procedures updated for TRID rules
The CFPB has announced updates to the exam procedures for the new mortgage disclosure rules to become effective August 1, 2015. The updates dated April 1, 2015, address
RESPA procedures—TILA RESPA Integrated Disclosures (applicable for examinations after the August 2015 effective date), and Mortgage Servicing Requirements
TILA procedures—TILA RESPA Integrated Disclosures (applicable for examinations after the August 2015 effective date), Higher-Priced Mortgage Loan Appraisals, Escrow Accounts, and Mortgage Servicing Requirements
Executive Order OKs sanctions against cybercriminals
The President has signed an Executive Order blocking the property of certain persons engaging in significant malicious cyber-enabled activities. Sanctions may be imposed on individuals and entities determined to be responsible for or complicit in malicious cyber-enabled activities that result in enumerated harms that are reasonably likely to result in, or have materially contributed to, a significant threat to the national security, foreign policy, or economic health or financial stability of the United States. A statement regarding the Executive Order was issued by Treasury Secretary Lew, and an FAQ was posted by OFAC. No designations have yet been made pursuant to the EO.
Fourth quarter trading report mixed
The OCC has released its Quarterly Report on Bank Trading and Derivatives Activities for the Fourth Quarter 2014. Insured U.S. commercial banks and savings institutions reported trading revenue of $4.4 billion in the fourth quarter of 2014, down $1.3 billion, or 22 percent, from $5.7 billion in the third quarter 2014. Trading revenue was, however, 52 percent higher than $2.9 billion in the fourth quarter of 2013.
OCC reminder of SCRA provision extension
OCC Bulletin 2015-21 has been issued to inform national banks, federal savings associations, and federal branches and agencies of foreign banks (OCC-supervised institutions) of the temporary extension of certain protections under the Servicemembers Civil Relief Act (SCRA), enacted by the Foreclosure Relief and Extension for Servicemembers Act of 2014. The action provides:
The SCRA amendments continue temporary provisions that extend protections [at 50 App. U.S.C. 533] to servicemembers, under certain conditions, related to the sale, foreclosure, or seizure of mortgaged property, or the filing of a legal action to enforce a mortgage obligation or other similarly secured obligation, within one year following the servicemember’s period of military service.
The temporary extension expires on December 31, 2015.
FDIC Advisory Committee on Community Banking to meet
The FDIC has announced that its Advisory Committee on Community Banking will meet today. The meeting also will be webcast live. Senior staff will provide updates on the FDIC's community bank initiatives, its regulatory review under the Economic Growth and Regulatory Paperwork Reduction Act (EGRPRA), the FDIC's Professional Liability Program and cyber security issues. The Committee will also discuss developments in retail payment systems and recently issued supervisory guidance. The agenda and a link to the webcast of the meeting has been posted.
First quarter Call Report materials
FDIC FIL-14-2015 has been issued regarding the instructions from the FDIC, OCC, and FRB for the First Quarter 2015 Consolidated Reports of Condition and Income (Call Report). Except for certain institutions with foreign offices, completed Call Report must be received by Thursday, April 30, 2015, in accordance with the filing requirements. No extensions of time for submitting Call Report data are granted.
April 1, 2015
CFPB announces new mortgage toolkit to replace HUD booklet
The Consumer Financial Protection Bureau has announced its release of a new toolkit to guide consumers as they shop for a home. Part of the Bureau's "Know Before You Owe" initiative, Your home loan toolkit—A step-by-step guide is designed to help consumers take advantage of the new Loan Estimate and Closing Disclosure forms that lenders will begin providing in August 2015 (the toolkit replaces the current HUD-designed Shopping for Your Home Loan, Settlement Cost Booklet, which should continue to be used in connection with any mortgage loan applications received before August 1). The toolkit is available in an interactive PDF format and will be available in printed form. A Spanish language version will be available later this year. An announcement of the toolkit was published in this morning's Federal Register [80 FR 17414].
Treasury designates Syrian financial and weapons networks
Treasury has announced the designation of Batoul Rida, an official of the Central Bank of Syria (CBoS), for acting for or on behalf of, and providing support to, the Government of Syria, enabling its military campaign against the Syrian people. Additionally, Treasury has designated the Syria-based front company Sigma Tech Company, Lebanon-based front company Shadi for Cars Trading, and Lebanon-based front company Denise Company, for acting for or on behalf of the Scientific Studies and Research Center (SSRC). SSRC is a U.S.- and E.U.-sanctioned Syrian government agency responsible for developing and producing non-conventional weapons and ballistic missiles, and has had connections to the Syrian chemical weapons program. Treasury is also publishing a new name used by Adib Mayaleh, the Governor of the CBoS, who was designated in 2012. The names of the individuals and entities have been added to the SDN List.
Troubled Florida credit union closed
The NCUA has announced the liquidation of the North Dade Community Development Federal Credit Union, Miami Gardens, Florida, after determining that the credit union had violated various provisions of its charter, bylaws and federal regulations. The credit union was assessed a $300,000 civil money penalty by FinCEN in November [Top Stories, November 26, 2014) for significant BSA/AML program violations. At that time, it was said to have five employees. The NCUA's announcement reports the credit union had $3 million in total assets as of its latest call report. It is the second federally insured credit union liquidation in 2015.
Wells Fargo given approval to use 'advanced approaches'
The Federal Reserve Board and the Office of the Comptroller of the Currency have announced that they have permitted Wells Fargo and its subsidiary national banks to begin using the "advanced approaches" capital framework starting in the second quarter of 2015. The framework implements standards developed by the Basel Committee on Banking Supervision and applies to large, internationally active banking organizations—generally those with at least $250 billion in total consolidated assets or at least $10 billion in total on-balance sheet foreign exposure—and includes the depository institution subsidiaries of those firms.
NCUA issues prohibition orders
The NCUA has issued seven orders prohibiting the following individuals from participating in the affairs of any federally insured financial institution:
Vytas Apanavicius, a former bookkeeper of Taupa Lithuanian Credit Union, Cleveland, Ohio
Michael Rusksenas, a former employee of that credit union
Alex Spirikaitis, the former CEO of that credit union
Wendy Wall, also known as Wendy Wright, a former employee of Pepsi Cola Federal Credit Union, Buena Park, California
Brandi Ward, a former employee of Dowell Federal Credit Union, Tulsa, Oklahoma
John Richards, a former employee of Polk County Credit Union, Des Moines, Iowa
Saundra Scales, a former employee of First Legacy Community Credit Union, Charlotte, North Carolina
New economic update video
The NCUA has released a new economic update video which covers the current outlook and key credit union results from year-end 2014. The video, available on the NCUA's YouTube channel, also discusses the effect of low oil prices on different states and regions, including the potential negative employment effects in oil producing regions.
Discount Window lending data released
The Federal Reserve has released Discount Window data for the first quarter of 2013.
Finance Companies G.20 report
The March 31, 2015, issue of the G.20 Finance Companies Owned and Managed Receivables Outstanding and Auto Loans: Terms of Credit report has been released by the Federal Reserve Board.
Office of Minority and Women Inclusion report
The Federal Reserve Board has delivered its March 2015 Report to Congress on the Office of Minority and Women Inclusion.
March 31, 2015
Bureau acts against 'bad check' collector
The Consumer Financial Protection Bureau announced yesterday that it has initiated an enforcement action against National Corrective Group (NCG), a privately-held California-based corporation that operates nationwide and specializes in the collection of consumer debt for bounced checks, and against related companies and Mats Johnson, NCG's CEO. The Bureau's complaint alleges that the company masqueraded as state or district attorneys; intimidated consumers with false threats of criminal charges; and deceived consumers into paying extra fees for a costly financial education class, all in violation of the Fair Debt Collection Practice Act (FDCPA). The CFPB's enforcement order, if approved by the court, would require NCG to cease its deceptive practices and pay a $50,000 civil penalty.
FFIEC on compromised credentials and destructive malware
The Federal Financial Institutions Examination Council (FFIEC) has released statements on destructive malware and compromised credentials that provide ways that financial institutions can identify and mitigate cyber attacks that compromise user credentials or use destructive software, known as malware. In addition, the FFIEC provided information on what institutions can do to prepare for and respond to these threats. In accordance with the FFIEC guidance, institutions should:
Securely configure systems and services;
Review, update, and test incident response and business continuity plans;
Conduct ongoing information security risk assessments;
Perform security monitoring, prevention, and risk mitigation;
Protect against unauthorized access;
Implement and test controls around critical systems regularly;
Enhance information security awareness and training programs; and
Participate in industry information-sharing forums, such as the Financial Services Information Sharing and Analysis Center.
The FFIEC also provided a list of practical information resources. The OCC has issued Bulletins 2015-19 and 2015-20, and the FDIC has posted FIL-13-2015 on the FFIEC statements.
Board issues updated bank reports
The Federal Reserve Board has released updated minority owned and large commercial bank reports for December 2014. The initial reports were released on March 26.
March 30, 2015
FDIC enforcement actions
The FDIC has released a list of enforcement actions recently taken against banks and individuals. Thirty-one orders were issued (four consent, two section 19, two civil money penalties (CMPs), ten removal and prohibition, twelve terminations of previous orders, and one adjudicated decision). Included in the list was a $10,600 CMP against Illini Bank, Springfield, Illinois, for violations of the Flood Act. Information regarding that CMP has been posted on the BOL Flood Penalties Watch page.
Affordable Care Act fact sheets for tax season
The Treasury Department has announced the availability of Affordable Care Act fact sheets on the following topics to provide information and tools to consumers as they prepare and file their tax returns:
Yellen on normalizing monetary policy
In a presentation at The New Normal Monetary Policy research conference sponsored by the Federal Reserve Bank of San Francisco, Chair Yellen discussed factors that will likely guide the decisions of the members of Federal Open Market Committee (FOMC) as they adjust the stance of monetary policy over time. She also discussed why most of her colleagues and she believe the return of the federal funds rate to a more normal level is likely to be gradual. She framed her remarks as responses to three questions:
Why does the FOMC judge that an increase in the federal funds rate target is likely to become appropriate later this year?
How are economic and financial considerations likely to shape the course of monetary policy over the next several years?
Are there special risks and other considerations that policymakers should take into account in the current environment?
Chair Yellen concluded, "If conditions do evolve in the manner that most of my FOMC colleagues and I anticipate, I would expect the level of the federal funds rate to be normalized only gradually, reflecting the gradual diminution of headwinds from the financial crisis and the balance of risks I have enumerated of moving either too slowly or too quickly. Nothing about the course of the Committee's actions is predetermined except the Committee's commitment to promote our dual mandate of maximum employment and price stability."
Curry on protecting seniors from financial abuse
In remarks at a conference hosted by the National Community Reinvestment Coalition, Comptroller Curry discussed the efforts of the host, various other organizations, and financial institutions to protect older individuals from financial exploitation.
Mortgage performance improves
The OCC has released its Mortgage Metrics Report for the Fourth Quarter 2014. Highlights include:
93.2 percent of mortgages were current and performing at the end of the quarter, up 0.4 percent over 2013
The percentage of mortgages that were 30 to 59 days past due was 2.4 percent of the portfolio, a 9.4 percent decrease from 2013
Seriously delinquent mortgages 60 or more days past due or held by bankrupt borrowers whose payments are 30 days or more past due made up 3.1 percent of the portfolio, a 12.2 percent decrease from 2013.
Fake FTC credit repair scam shut down
A federal court has ordered the end of a credit repair scam with the name FTC Credit Solutions. A complaint filed by the Federal Trade Commission alleged that defendants deceived consumers by claiming to be affiliated with or licensed by the FTC, falsely promising that they could remove negative information from consumers' credit reports, and guaranteeing consumers a credit score of 700 or above within six months or less. The company aired radio commercials and verbally falsely stated that FTC Credit Solutions had a license from the FTC. The FTC further alleged that the company unlawfully charged consumers fees in advance of providing the promised credit repair services and also sent the major credit bureaus letters with false information on behalf of numerous consumers.
Payment processors settle FTC charges
The Federal Trade Commission has announced that CardFlex Inc., an Independent Sales Organization (ISO), and its principals Andrew Phillips and John Blaugrund, have settled Commission charges that they illegally processed more than $26 million in unauthorized consumer charges on behalf of a company called I Works. The defendants are the last of seven individual and corporate defendants named in the FTC’s suit to settle. The stipulated court order prohibits CardFlex, Phillips, and Blaugrund from: 1) acting as a payment processor, ISO, or sales agent on behalf of several categories of merchants; and 2) assisting and facilitating clients’ attempts to evade credit card risk-monitoring programs. The order also imposes a $3.3 million monetary judgment against CardFlex and Phillips that will be partially suspended based on their current financial condition. Phillips will pay $150,000 and turn over personal assets, including nearly $1.2 million worth of jewelry that the FTC will sell at auction. However, the full judgment will become due, if it is later discovered that the defendants misrepresented their financial condition to the Commission.
March 27, 2015
CFPB announces rulemaking process series
The Consumer Financial Protection Bureau has announced the start of a series of blog posts explaining some key parts of the rulemaking process. The first post indicates how small businesses can provide the Bureau feedback and help the agency write regulations regarding financial products and services. It also indicates a Small Business Review Panel will be created each time the CFPB is working on a rule that could have significant economic impacts on small entities (small businesses, organizations, and small government bodies). Each Small Business Review Panel will consist of representatives from the CFPB, Small Business Administration, and the Office of Management and Budget's Office of Information and Regulatory Affairs. The panels will:
hold an outreach meeting with a representative group of small businesses to discuss the potential rules being considered
publish meeting materials on the Bureau's website (panel meetings, however, aren't public)
conduct a free and open discussion with the small business representatives, keeping the meetings small
summarize discussions in a panel report which will be published along with a proposed rule
Mortgage rates decrease
The Federal Housing Finance Agency (FHFA) has released its February 2015 Index, which reports that nationally interest rates on conventional purchase-money mortgages decreased from January to February, according to several indices of new mortgage contracts.
Consumer and Mobile Financial Services report
The Board also released the Consumer and Mobile Financial Services 2015 report, which indicates the use of mobile phones to access bank accounts, credit cards, or other financial accounts continued to increase among adults in the United States during 2014. The survey was first conducted in December 2011 and has been conducted annually since to understand how the rapidly expanding use of this technology affects consumer decision-making. A video summarizing the survey's mobile financial services findings was also released.
Filing deadline adjusted for large NBFIs
A joint press release by the Federal Reserve and the FDIC has announced the permanent adjustment of the annual resolution plan filing deadline for American International Group, Inc., General Electric Capital Corporation, Inc., MetLife Inc., and Prudential Financial, Inc., from July 1 to December 31 beginning in 2016.
Rewards offered for Russian financial cybercriminals
ICE has posted a "wanted poster" offering multi-million dollar rewards for information leading to the arrest and/or conviction of two alleged Russian cybercriminals identified during a far-reaching federal investigation into a worldwide online marketplace for stolen personal and financial information. The two fugitives, Roman Olegovich Zolotarev ($2 million reward) and Konstantin Lopatin ($1 million), were indicted following a probe spearheaded by Las Vegas-based agents with U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI). They are members of an internet-based criminal enterprise known as Carder-su, which traffics in and manufactures stolen and counterfeit identification documents and access devices such as debit and credit cards, and engages in identity theft and financial fraud crimes.
March 26, 2015
Bureau reveals payday debt plans
In another of its orchestrated "reveals," the Consumer Financial Protection Bureau announced early this morning its plans for a proposed rule that would cover payday loans, vehicle title loans, and certain high-cost installment and open-end credit extensions. The Bureau's long-anticipated announcement, to be aired publicly in remarks today by Director Cordray at the agency's Richmond, Virginia, field hearing, would end "payday debt traps" by requiring lenders to make sure consumers can repay their loans, and restrict lenders from attempting to collect payment from consumers' bank accounts in ways that tend to cause fees to pile up. The proposals under consideration would cover short-term credit products that require consumers to pay back the loan in full within 45 days, such as payday loans, deposit advance products, certain open-end lines of credit, and some vehicle title loans. Among other measures under consideration are:
A requirement that lenders determine at the outset that the consumer can repay the loan when due without defaulting or re-borrowing
A 60-day cooling off period between loans, in most cases
A limit of three loans (including renewals) in a row before a mandatory 60-day borrowing break
A mandate for affordable repayment options, including a no-cost "off-ramp" for a borrower who can't repay after two renewals
For loans with terms over 45 days, protections similar to those offered under the NCUA's "payday alternative loans" program
A three-day notification before accessing deposit accounts for payments
A requirement for a new consumer authorization to access a deposit account after two consecutive unsuccessful attempts to collect from the account
A live video of the field hearing will be streamed on the Bureau's Blog, beginning at 12 noon ET.
PayPal pays $7.6M for OFAC violations
OFAC has announced a $7,658,300 settlement with PayPal, Inc. to settle potential civil liability for 486 apparent violations of the Weapons of Mass Destruction Proliferators Sanctions Regulations, the Iranian Transactions and Sanctions Regulations, the Cuban Assets Control Regulations, the Global Terrorism Sanctions Regulations, and the Sudanese Sanctions Regulations. PayPal did not screen in-process transactions in order to reject or block prohibited transactions pursuant to applicable U.S. economic sanctions program requirements and processed transactions to or from PayPal accounts registered to individuals on OFAC's List of Specially Designated Nationals and Blocked Persons (SDN List). OFAC also announced the assessment of a $780,000 civil money penalty (CMP) against Life for Relief and Development, Southfield, MI. to settle potential civil liability for apparent violations of the former Iraqi Sanctions Regulations. In addition in an unrelated action, OFAC added an individual to its SDN List.
OCC schedules director's workshops in Kentucky
The OCC will host two workshops in Louisville, Kentucky, on May 5–6, 2015, for directors of national community banks and federal savings associations. A Risk Governance workshop on May 5 will provide practical information for directors to effectively measure and manage risks. A Compliance Risk workshop on May 6 will discuss the critical elements of an effective compliance risk management program.
FDIC State Profiles for Fourth Quarter 2015
The FDIC has released its State Profiles for the Fourth Quarter 2015. The profiles are a quarterly data sheet summation of banking and economic conditions in each state.
NCUA warns consumers of telephone spoofing scam
A warning has been issued by the NCUA to alert consumers that texts they receive from an agency telephone line, 703-518-6301, asking for personal information are not coming from the agency. This attempted fraud scam is called "spoofing" (see http://www.fcc.gov/guides/caller-id-and-spoofing, an FCC Guide). The texts may warn of a debit card reaching its limit or use some other trick to persuade individuals to provide personal information or go to a malicious website. Consumers should not click on links in the message, provide information to any websites referenced in the message nor attempt to conduct any financial transactions through those websites.
March 25, 2015
Albanian narcotics trafficker's sons designated
Treasury has announced the designation of four brothers and five entities as Specially Designated Narcotics Traffickers (SDNTs) pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act) for their role in the criminal organization led by Albanian Kosovar narcotics trafficker Naser Kelmendi who was designated an SDNT in 2012. The five companies designated are owned, controlled, or directed by Kelmendi or his family members in Kosovo, Bosnia and Herzegovina, and Montenegro. The four brothers are Kelmendi's sons. In addition, the names of numerous individuals and entities with Cuba designations were deleted from the OFAC list. See OFAC's March 24, 2015, SDN List Update for details on the new and removed listings.
February residential sales up
HUD and the Census Bureau have released their residential sales data for February 2015. Sales of new single-family houses in February were at a seasonally adjusted annual rate of 539,000, which was 7.8 percent above the revised January rate of 500,000 and is 24.8 percent above the February 2014 estimate of 432,000. The median sales price of new houses sold in February 2015 was $275,000; the average sales price was $341,000.
Gruenberg testifies on treatment of TPPPs
In testimony before the Subcommittee on Oversight and Investigations of the House Financial Services Committee, Chairman Gruenberg discussed the FDIC's supervisory approach regarding insured institutions providing banking services to customers, including third-party payment processors (TPPPs). He clarified the agency's approach and also discussed the interaction with the Department of Justice's Operation Choke Point. He noted that the FDIC's supervisory approach focuses on assessing whether financial institutions are adequately overseeing activities and transactions they process and appropriately managing and mitigating related risks. He said, "Our supervisory efforts to communicate these risks to banks are intended to ensure institutions perform the due diligence, underwriting, and monitoring necessary to mitigate the risks to their institutions."
March 24, 2015
FDIC issues opt-out election reminder
FDIC FIL-12-2015 has been issued as a reminder to FDIC-supervised institutions not subject to the advanced approaches risk-based capital rules that they may elect to calculate regulatory capital using the treatment for accumulated other comprehensive income (AOCI) permitted in the FDIC's general regulatory capital rules in effect prior to January 1, 2015.
Regulators require foreign banks to address plan shortcomings
The Federal Reserve Board and the FDIC have issued a joint press release announcing that they had completed the reviews of resolution plans submitted in 2014 by three large foreign banking organizations (BNP Paribas, HSBC Holdings plc, and The Royal Bank of Scotland Group plc) and had issued feedback letters to each institution with directions to address specific shortcomings. The agencies will require that the annual plans submitted by these three institutions on or before December 31, 2015, demonstrate that the firms are making significant progress to address all the shortcomings identified in the letters, and are taking actions to improve their resolvability under the U.S. bankruptcy code.
Curry on assistance to savings associations and community banks
In remarks during the American Bankers Association Mutual Community Bank Conference, Comptroller Curry discussed the OCC's efforts to assist mutual savings associations and community banks. He noted the actions include ongoing meetings of the OCC Mutual Savings Association Advisory Committee, supporting collaboration among community banks, reducing unnecessary and burdensome regulation, and recommending actions Congress can take to reduce needless burden.
March 23, 2015
OCC enforcement actions include $500,000 CMP
The OCC has released a list of enforcement actions recently taken against national banks, federal savings associations, and individuals currently and formerly affiliated with national banks and federal savings associations. A Pennsylvania bank was assessed a $500,000 civil money penalty for failures to file timely suspicious activity reports.
Coalition to fight ISIL's financial network
Treasury has announced that the United States has joined Italy and Saudi Arabia to lead the inaugural meeting in Rome of the Counter-ISIL Finance Group (CIFG). The CIFG was established as part of the counter-ISIL Coalition effort to enhance coordination among international partners on key efforts to defeat ISIL. Representatives from 26 countries and several multilateral organizations met to agree on an Action Plan to further their understanding of ISIL's financial and economic activities, share relevant information, and develop and coordinate efforts to combat the ISIL financial network.
OCC schedules Denver compliance and credit risk workshops
The OCC has announced it will host two workshops in Denver on April 21–22, 2015, for directors of national community banks and federal savings associations. A workshop will be conducted on April 21, combining lectures, discussion, and exercises on the critical elements of an effective compliance risk management program. The workshop also focuses on major compliance risks and critical regulations. An updated Credit Risk workshop will be held on April 22, focusing on credit risk within the loan portfolio, identifying trends and recognizing problems. The workshop also covers the roles of the board and management, how to stay informed of changes in credit risk, and how to effect change. Each workshop will be repeated at various locations throughout 2015.
Federal Reserve System financial statements
The Federal Reserve System has released the 2014 combined annual financial statements for the Federal Reserve Banks, as well as statements for the 12 individual Reserve Banks, Maiden Lane LLC, and the Board of Governors. Links to the information may be found on the Federal Reserve Board's website.
NCUA videos on CDFI Fund certification
A new five-part video series, "CDFI Fund Certification," is now available online on NCUA's YouTube channel. The series shows how Community Development Financial Institution certification opens financial doors to credit unions to help them in serving the underserved.
March 20, 2015
CFPB finalizes policy for public consumer complaints
The CFPB has announced, and posted a Bureau Blog article about, a final Consumer Complaint Narrative Policy and the creation of the Consumer Complaint Database. The Policy empowers consumers to voice publicly their complaints about consumer financial products and services. When consumers submit a complaint to the CFPB, they now have the option to share their account of what happened. A Final Policy Statement has been issued to provide guidance on how the CFPB plans to exercise its discretion to disclose consumer complaints via the Consumer Complaint Database. The CFPB states it will not publish any such narratives for at least 90 days after publication of the policy in the Federal Register. The CFPB is also publishing a Request for Information seeking public input on ways to highlight positive consumer experiences, such as by receiving consumer compliments.
Bureau updates TRID Rule implementation materials
The Consumer Financial Protection Bureau has announced the availability of updated versions of its TILA-RESPA Integrated Disclosure Rule implementation materials. Each of the following documents has been updated to incorporate changes to the rule that have been finalized to date:
Regulators testify on expectations of institutions
Comptroller Curry and Chairman Gruenberg presented testimony before the Senate Committee on Banking, Housing, and Urban Affairs. The Comptroller discussed the OCC's approach to tailoring regulatory and supervisory expectations to the size and complexity of supervised institutions. He presented an oral statement and written testimony. The Chairman issued a statement and testified on the FDIC's regulatory regime for regional banks and reviewed various considerations important to any discussion of proposals to change these requirements.
NCUA Board action
A Board Action Bulletin has been issued by the NCUA announcing action taken at the March 19, 2015, Board meeting. A proposed rule to provide regulatory relief to thousands of federal credit unions by eliminating certain provisions in the agency's fixed-assets rule, including the current five-percent cap on investments in fixed assets was unanimous approved. The proposed rule would:
Eliminate the current five-percent aggregate limit on investments in fixed assets
Eliminate provisions in the current rule relating to waivers from the aggregate limit
Simplify the rule's partial occupancy requirements by establishing a single six-year period and removing the current 30-month requirement for partial occupancy waiver requests
Move oversight of federal credit union fixed-assets ownership from regulation to the supervisory process
NCUA free webinar
The NCUA has issued a reminder that registration is still open for its March 25, 2015, webinar, "Successful Strategies for Field of Membership Expansion."
March 19, 2015
FinCEN proposes special measures against Andorran bank
FinCEN has published a notice of proposed rulemaking that would prohibit covered financial institutions from establishing, maintaining, administering, or managing in the United States any correspondent account for or on behalf of Banca Privada d'Andorra, a financial institution operating outside of the United States that is of primary money laundering concern. Comments on the proposal are due by May 12, 2015.
Colorado check casher penalized for continuing BSA/AML violations
FinCen has announced the assessment of a $75,000 civil money penalty against a Colorado money services business (MSB), Aurora Sunmart Inc., and its owner and general manager, Jamal Awad. Since 2008, Aurora willfully violated the Bank Secrecy Act's (BSA's) registration, program, and reporting requirements. Mr. Awad, who also served as the MSB's compliance officer, admitted to willfully participating in these violations. Aurora failed to implement an effective written anti–money laundering (AML) program by failing to implement adequate AML controls, failing to conduct an adequate internal review of its compliance program, and failing to provide pertinent compliance training for staff, all of which are required under the BSA. On average, between 2009 and 2012, 49 percent of the CTRs filed by Aurora were filed significantly late and it has not filed any CTRs since September 2012. Aurora has been the subject of three BSA/AML compliance examinations, all of which found significant and repeated violations. In addition to the fine, Aurora and Mr. Awad also agreed to an undertaking to immediately cease operation of any business related to any money services activity that requires registration with FinCEN until several conditions related to establishing and maintaining a proper AML program are met.
Fed releases FOMC statement and projections
The Federal Reserve Board and the Federal Open Market Committee (FOMC) have released the FOMC's statement following its March 17-18 meeting, and the economic projections used in that meeting.
OFAC designates drug trafficking family
Treasury has announced the designation by OFAC of three Mexican nationals under the Foreign Narcotics Kingpin Designation Act (Kingpin Act). Felipe, Alejandro, and Jose Luis Cabrera Sarabia are major heroin and marijuana suppliers for the Sinaloa Cartel based in the state of Durango, Mexico. A chart of the Sinaloa Cartel leadership was also provided. For details on the designees, see OFAC's March 18, 2015, SDN List Update.
NCUA Report and Board meeting available
The NCUA has posted the March 2015 issue of The NCUA Report. The video of the February 19, 2015, meeting of the NCUA Board is also available online.
NMLS system maintenance scheduled
The NMLS has announced it will undergo system maintenance on March 21, 2015, from 6:00 a.m. to 11:00 a.m. ET. Additionally, users will be unable to schedule, change, or cancel test appointments until 2:00 p.m. ET on that date.
March 18, 2015
CFPB to Review Credit Card Market
The CFPB has announced the agency is seeking public comment on how the credit card market is functioning and the impact of credit card protections on consumers and issuers. The CFPB is specifically interested the following areas:
The terms of credit card agreements and practices of credit card issuers
Unfair or deceptive acts or practices in the credit card market
Debt collection practices within the credit card industry
Consumer understanding of rewards products
Editor's note: The Request for Information was published in the Federal Register and comments are due by May 18, 2015.
FFIEC Lists 2015 Cybersecurity Priorities
An overview of its cybersecurity priorities for the remainder of 2015 has been released by the FFIEC. Seven workstreams from last year's assessment are the priority topics. These include:
Cybersecurity Self-Assessment Tool
Technology Service Provider Strategy
Collaboration with Law Enforcement and Intelligence Agencies
ICE Deports Convicted Bank Fraudster
U.S. Immigration and Customs Enforcement (ICE) has announced the deportation of a Czech national previously convicted federally of bank fraud who was turned over to law enforcement authorities in Prague to face criminal charges for breaking and entering, theft, larceny and violation of domestic freedom.
Lew Testimony on International Monetary and Financial Policies
In testimony before the House Financial Services Committee, Secretary Lew discussed the growth in the U.S. economy and the request for Congressional approval of the International Monetary Fund (IMF) quota and governance reforms. He stated, "A well-resourced and effective IMF is indispensable to achieving our economic and national security interests, protecting the health of the U.S. economy, and enhancing the prosperity of America's workers." The Secretary concluded, "U.S. leadership in international financial institutions enables us to influence how and where resources are deployed - often on a scale that we cannot achieve through our bilateral programs alone. However, bipartisan support is required to ensure that influence remains as strong today as it has been over the past several decades."
Residential Construction Activity Mixed
HUD and the Census Bureau have announced the February 2015 new residential construction statistics.
Building Permits - privately owned housing units authorized by building permits in February were at a seasonally adjusted annual rate 3.0 percent above the revised January rate, but is 7.7 percent above the February 2014 estimate. Single-family authorizations in February were 6.2 percent below the revised January figure.
Housing Starts - privately owned housing starts in February were at a seasonally adjusted annual rate 17 percent below the revised January estimate and i 3.3 percent below the February rate. Single-family housing starts in February were at 14.9 percent below the revised January figure.
Housing Completions - privately owned housing completions in February were at a seasonally adjusted annual rate 13.8 percent below the revised January estimate and 1.8 percent below February. Single-family housing completions in February were 12.1 percent below the revised January rate.
FRB Proposes Requirement of Legal Entity Identifiers on Reporting Forms
The FRB has issued a proposal to require banking organizations to include their existing Legal Entity Identifiers (LEIs) on certain regulatory reporting forms. The LEI is a unique reference code to enable easier identification of a firm's legal entities. The proposal would require LEIs on certain reporting forms as of June 30, 2015. Comments on the proposal are requested within 60 days of publication in the Federal Register.
NCUA Issues Phishing Scam Warning
A Press Release has been issued by NCUA regarding the receipt of reports of an online phishing scam that uses a website with a logo and a design similar to the agency's own site in an attempt to convince unwary customers to provide information or send money. The emails received by consumers appearing to be from the NCUA website but apparently originated in Australia and claims to offer services in the United States, Europe and the Commonwealth of Independent States. This website is not affiliated in any way with the National Credit Union Administration, a federal agency, and the emails are not from NCUA. Consumers receiving such emails should callNCUA's Fraud Hotline and contact the Internet Crime Complaint Center.
March 17, 2015
Register for FRB Payment System Improvement Task Forces
The FRB has announced the details for participation in two task forces described in its recently published "Strategies for Improving the U.S. Payment System" paper. Participants on the Faster Payments Task Force will identify and evaluate alternative approaches for implementing safe, ubiquitous, faster payment capabilities in the United States. The Secure Payments Task Force will advise the Federal Reserve on payment security matters, consult on security aspects of the Faster Payments Task Force work, and help determine priorities for future action to advance payment system safety, security and resiliency. Click for more Faster Payments and Secure Payments information regarding the task forces, participation requirements and registration information. The Federal Reserve will host Task Force teleconferences on March 20 and March 31 to field questions from interested individuals. To register and submit advance questions for these sessions click here.
FinCEN Updates Jurisdictions with AML/CFT Deficiencies
FinCEN has issued Advisory 2015-A001 regarding the FATF update of its list of jurisdictions with strategic AML/CFT deficiencies. These changes may affect U.S. financial institutions' obligations and risk-based approaches with respect to relevant jurisdictions. Information regarding the FATF update was posted in the March 2, 2015 BOL Top Stories.
Pension Advance Traps CFPB Consumer Advisory
The CFPB has posted on its Blog a Consumer Advisory regarding three pension advance traps consumers should avoid. The following tips were discussed:
1. Avoid loans with high fees and interest.
2. Don't sign over control of your benefits.
3. Don't buy life insurance that you don't want or need.
March 16, 2015
March FedFlash Posted
FRB Services has posted the March 2015 issue of FedFlash. The issue includes articles on the following topics:
Changes in support for Internet Explorer
Commercial check and ACH posting rule changes
Upcoming check debit transaction code changes
Canadian item cash letter deposit reminders
Reminder of March 2015 NACHA rule changes and new national settlement service operating hours
Schedule for Changes to ACH Benefit Payments from OPM Announced
Treasury has announced its Bureau of Fiscal Service will make changes to some of the ACH data fields associated with the issuance of Office of Personnel Management (OPM) Benefit payments. Financial institutions will begin receiving OPM ACH benefit payments with these changes effective April 13, 2015, for Daily payments and May 1, 2015, for Monthly recurring payments. A matrix mapping the changes was also released.
March 13, 2015
Commerzbank Pays $1.71B for Sanctions, BSA and AML Violations
The Federal Reserve, U.S. Department of Justice (DOJ), OFAC, New York County District Attorney's Office, and the New York Department of Financial Services are penalizing a German bank, Commerzbank AG, for violations of U.S. sanctions, anti-money laundering requirements, and various New York state laws. The agencys' investigations indicated Commerzbank use of payment practices interfered with the implementation of U.S. economic sanctions by financial institutions in the United States. References to originating Iranian financial institutions were deleted or omitted and replaced with Commerzbank's name from payment messages sent to U.S. financial institutions. Commerzbank also created a process to route payments involving Iranian counterparties to a payment queue requiring manual processing by bank employees rather than routine, automated processing. These practices were used by Commerzbank in 1,596 financial transactions routed to or through banks in the United States between 2005 and 2010. The regulators actions also prohibit Commerzbank from re-employing the individuals involved in the past actions or retaining them as consultants or contractors. The penalties issued by all of the agencies total $1.71 billion.
FTC and CFPB Reauthorize MOU
The FTC and CFPB have announced the reauthorization of their ongoing memorandum of understanding. The memorandum outlines the working relationship between the two agencies under the terms of the Consumer Financial Protection Act, and is designed to coordinate efforts to protect consumers and avoid duplication of federal law enforcement and regulatory efforts.
Stress Test Advisory Council Members
The FRB has released the names of the four members of its Model Validation Council. The Council was established in 2012 to provide expert and independent advice on its process to rigorously assess the models used in stress tests of banking institutions.
Winter Issue of FDIC Consumer News Posted
The FDIC has posted the 2015 Winter issue of FDIC Consumer News which features articles on the following topics:
Buying or Refinancing a Home?
Finding an Auto Loan That's Good to Go
Are You Ready to Pay by Smartphone?
Have a Complaint About a Bank? A Regulator Can Help
More Answers to Common Questions
Our Latest Tips on How and Where to Save
NCUA Quarterly Map Review Available
The Fourth Quarter 2014 NCUA Quarterly U.S. Map Review, prepared by NCUA's Office of the Chief Economist tracks performance indicators for federally insured credit unions in the 50 states and the District of Columbia is now available. The current issue reports nationally, median asset growth was up during 2014, with delinquencies holding steady. While overall membership increased, that growth was concentrated in larger credit unions. Smaller credit unions were more likely to lose members. Share and deposit growth was up, as was return on average assets. The review also includes two key state-level economic indicators: unemployment rates and home price changes.
NCUA Board Meeting Agenda
The agenda for the March 19, 2015, meeting of the NCUA Board has been posted. Corporate Stabilization Fund Quarterly Report and Ownership of Fixed Assets will be discussed.
March 12, 2015
CFPB Supervision Report of Violations and $19.4M in Remediation
The CFPB has announced the release of its Supervisory Highlights report regarding legal violations uncovered by the Bureau's examiners. The Bureau found deceptive student loan debt collection practices, unfair and deceptive overdraft practices, mortgage origination violations, fair lending violations, and mishandled disputes by consumer reporting agencies. The report also shows that CFPB supervisory resolutions resulted in remediation of $19.4 million to more than 92,000 consumers.
Treasury Designates Ukrainian Separatists and their Russian Supporters
Treasury has announced the designation of eight Ukrainian separatists, a Russian pro-separatist organization and three of its leaders, a Crimean Bank, and three former Yanukovych officials. The list of the entities and individuals have added to the SDN List.
Comprehensive Capital Analysis Review Results Released
The FRB has announced the results of its most recent review of the capital plans of bank holding companies (BHCs) participating in the Comprehensive Capital Analysis and Review (CCAR). The plans of 28 BHCs were not objected to, one institution received a conditional non-objection based on qualitative grounds, and two firms' plans were objected to on qualitative grounds.
OCC to Host Indianapolis Bank Directors Workshop
The OCC has announced it will host a workshop in Indianapolis for directors of national community banks and federal savings associations on April 11-13, 2015. The "Building Blocks for Directors" workshop is designed to introduce new bank directors to the OCC's approach to supervision and provides experienced bank directors with a review of core concepts. The workshop combines lectures, discussion, and exercises to provide practical information on the roles and responsibilities of board participation. The workshop fee is $99 and is limited to the first 35 registrants. Click here for more information and registration instructions.
CFPB to host Payday Lending Field Hearing
The Bureau Blog has announced a field hearing on payday lending will be hosted by the CFPB in Richmond, VA on March 26 at 12 pm EDT. The event is open to the public, but requires an RSVP. A live video will be streamed on the Blog.
Bureau Lists Reasons for Opening Savings Accounts for Kids
An article posted on the Bureau Blog discusses the results of a recent study regarding the educational impact of a child's savings account. It also referenced the recently issued guidance federal banking regulators have issued for banks and credit unions when they're asked to open savings accounts for children under age 18.
March 11, 2015
Bureau hearing on arbitration
The Consumer Financial Protection Bureau held a field hearing on arbitration in Newark, N.J. on May 10. The hearing featured remarks from Director Cordray and testimony from consumer groups, industry representatives, and members of the public. The CFPB Blog featured an article on the results of a study on arbitration agreements conducted by the agency and reported to Congress. The agency also released a Fact Sheet on the report.
SCOTUS reverses ruling against Labor Department
The Supreme Court of the United States has reversed the ruling of the U.S. Court of Appeals for the District of Columbia Circuit in Perez, Secretary of Labor, et al. v. Mortgage Bankers Association et al. The lower court had ruled that the Department of Labor's 2010 reversal of its 2006 interpretation that mortgage loan officers fell within the administrative exemption under its 2004 regulations on overtime pay was procedurally invalid because the Department failed to use the Administrative Procedures Act's notice-and-comment procedures. The Supreme Court ruled that the APA exempts the issuance of interpretive rules from the requirements of the APA.
CommerceWest Bank in deferred prosecution agreement
CommerceWest Bank, Irvine, California, will pay more than $4.9 million in restitution and enter a deferred prosecution agreement to settle federal consumer fraud charges, reports Corporate Crime Reporter. The bank was charged with a felony violation of the Bank Secrecy Act in connection with its relationship with V Internet Corp LLC, a third party payment processor. The civil complaint in the case alleges that the bank facilitated consumer fraud by permitting the payment processor to make millions of dollars of unauthorized withdrawals from consumer bank accounts on behalf of fraudulent merchants.
Fictitious OCC correspondence alert
The OCC has issued Alert 2015-4 concerning fictitious correspondence about the release of funds supposedly under the OCC's control. The correspondence has been distributed via e-mail, fax or postal mail. The correspondence may indicate that funds are being held by a specific financial institution and that the recipient is required to pay a "Clean Bill of Records Certificate (C.B.R.C.)" fee before the funds are released to the beneficiary. The e-mail address used in the electronic correspondence may be from [firstname.lastname@example.org].
March 10, 2015
New Venezuela-related Executive Order and OFAC Designations
The Treasury Department has announced that an Executive Order (EO) has been signed by the President blocking property and suspending entry of certain persons contributing to the situation in Venezuela. Seven individuals have been designated and their names added to the SDN List. Secretary Lew also issued a statement regarding the Executive Order.
New Members of OCC Advisory Committee
The OCC has announced the appointment of five new members to its Mutual Savings Association Advisory Committee . The committee's responsibilities include assessing the condition of mutual savings associations, regulatory changes or other steps the OCC could take to ensure the health and vitality of mutual savings associations, and other issues of concern to these depository institutions.
Matz designates Year of Regulatory Relief
In the keynote speech to the Credit Union National Association's annual Governmental Affairs Conference, NCUA Chairman Matz stated "I'm committed to making 2015 the year of regulatory relief."
March 9, 2015
Trump casino hit with $10M CMP for AML violations
FinCEN has announced it has issued a $10 million civil money penalty order against the Trump Taj Mahal Casino Resort in Atlantic City, New Jersey, for willful and repeated violations of the Bank Secrecy Act. The Order also requires the casino to conduct periodic external audits and report its findings to FinCEN and the casino's Board. In 1998, FinCEN assessed a $477,000 CMP against the casino for similar violations.
Comptroller's Handbook revision
The Office of the Comptroller of the Currency has issued Bulletin 2015-17 announcing the revision of the Deposit-Related Credit booklet of the Comptroller's Handbook. The revised booklet replaces and clarifies the prior edition, which was issued February 11, 2015. It addresses check credit products and services, overdraft protection services, deposit advance products, and risk management of third-party relationships involving these products and services.
January consumer credit report
The Federal Reserve Board has released the G.19 Consumer Credit Outstanding and Terms of Credit Report for January 2014. Consumer credit increased at a seasonally adjusted annual rate of 4¼ percent. Revolving credit decreased at an annual rate of 1½ percent, while nonrevolving credit increased at an annual rate of 6¼ percent.
March 6, 2015
Stress test results
The Federal Reserve Board has announced the results of the 2015 Dodd-Frank Act Stress Test 2015. This is the fifth round of stress tests led by the Fed since 2009 and the third round required by Dodd-Frank. The 31 firms tested represent more than 80 percent of domestic banking assets. The most severe hypothetical scenario projects that loan losses at the 31 participating bank holding companies would total $340 billion during the nine quarters tested. The "severely adverse" scenario features a deep recession with the unemployment rate peaking at 10 percent, a decline in home prices of 25 percent, a stock market drop of nearly 60 percent, and a notable rise in market volatility. But the largest U.S. banks showed they could withstand such a severe downturn.
Recession and regulation—Fewer banks
A report released by the Federal Reserve Bank of Richmond, "Explaining the Decline in the Number of Banks since the Great Recession, states that the number of commercial banks in the U.S. dropped by more than 800 (14%) beginning with the financial crisis of 2007–2008, through 2013. The drop was primarily among small community banks (under $50 million in assets), which were down 41% over the seven-year span. Some of that reduction can be ascribed to failures, but the decline is mostly due to a lack of de novo banks. The reports suggests that the absence of new bank entries could have significant economic repercussions.
FedFocus on Analyzer Tool
The March 2015 issue of FedFocus features an article on how the FedTransaction Analyzer Tool can help organizations assess risk and automate manual processes while seamlessly integrating with other software. Other articles discuss eight ways to help spot a fake email and how to find a FEDucation "pot o' gold."
March 5, 2015
FEMA publishes lists of suspended communities
Today's Federal Register includes notices of two final rules from the Federal Emergency Management Agency listing communities where the sale of flood insurance has been authorized under the National Flood Insurance Program (NFIP) that are scheduled for suspension on the effective dates below because of noncompliance with the floodplain management requirements of the program.
April 16, 2015 - Certain unincorporated areas in Richmond County, Virginia
April 2, 2015 - Designated communities in Indiana, Minnesota, Missouri and Ohio
FDIC CRA ratings
The FDIC has issued the list of CRA ratings recently received by eighty-one state nonmember banks. There were five Outstanding, seventy-three Satisfactory, one Needs to Improve, and two Substantial Non-compliance ratings in the list.
FRB changes Internet Explorer support
Federal Reserve Financial Services has announced it will provide support for Microsoft Internet Explorer 11 for use with its FedLine Web® and FedLine Advantage® access solutions. Support for Internet Explorer 8 will be discontinued effective April 15, 2015. Versions 9 and 10 will continue to be supported.
March Beige Book
The April 17, 2015 issue of the Beige Book has been released by the Federal Reserve Board.
March 4, 2015
CRA ratings from OCC
The OCC has released the ratings received by fifteen national banks and federal savings associations that were recently evaluated for compliance with the CRA. Four were rated Outstanding, ten Satisfactory and one Needs to Improve.
NCUA announces field-of-membership webinar
The NCUA will host a free 90-minute webinar, "Successful Strategies for Field-of-Membership Expansion," on March 25, 2015, at 2 p.m. ET. The presentation is for credit unions planning to expand membership and improve service for underserved communities.
Cordray on CFPB Report to Congress
Consumer Financial Protection Bureau Director Cordray presented written testimony to the House Committee on Financial Services regarding the agency's sixth semi-annual report to Congress. He discussed the efforts of the Bureau to protect consumers in the financial marketplace.
Lew discusses Treasury budget with Senate committee
In testimony before the Senate Appropriations Subcommittee on Financial Services and General Government, Secretary Lew discussed the Department of the Treasury's fiscal year 2016 budget.
Federal Reserve adds to FAQ
The Federal Reserve Board has updated its Current FAQS web page to state its view that it is important to separate Federal Reserve monetary policy decisions from political influence.
March 3, 2015
Enhanced requirements for Freddie and Fannie NPL sales
The Federal Housing Finance Agency has announced enhanced requirements for sales of non-performing loans (NPLs) by Freddie Mac and Fannie Mae. The NPL sales are generally expected to include loans that are severely delinquent, such as loans that are more than a year past due. The requirements include:
Loss mitigation waterfall
A fact sheet about the enhanced requirements was also released.
Curry discusses BSA with international bankers
In remarks delivered to the Institute of International Bankers, Comptroller Curry discussed the Bank Secrecy Act, the agency's supervisory expectations for federal branches and agencies, and the importance of clear communications and information sharing between the OCC and foreign banking organizations.
CU loan growth continues
The NCUA has announced that 4th Quarter 2014 Call Report data indicate loans at federally insured credit unions in 2014 climbed to the highest level since 2005. Membership, assets, deposits and net worth saw continued positive growth in the fourth quarter of 2014. Net interest margins held steady from the previous quarter and were slightly higher than at the end of 2013.
Bank pays $1.5 CMP for failure to file
FinCEN has announced it has assessed a $1.5 million civil money penalty and the OCC has imposed a $500,000 CMP against the First National Community Bank of Dunmore, Pennsylvania, for willfully violating the Bank Secrecy Act (BSA). Five hundred thousand dollars of FinCEN's $1.5 million assessment will be concurrent with the penalties and remedies imposed by the OCC. The bank admitted that it knowingly failed to file suspicious activity reports on transactions involving illicit proceeds from a judicial corruption scheme spanning over five years, in which two former Pennsylvania judges misused their positions to profit from, among other things, sending thousands of juveniles to detention facilities in which they had a financial interest.
Volcker Rule FAQs
The Federal Reserve Board has issued an updated set of FAQs on Section 619 of the Dodd-Frank Act, commonly know as the Volcker Rule, which generally prohibits insured depository institutions and any company affiliated with an insured depository institution from engaging in proprietary trading and from acquiring or retaining ownership interests in, sponsoring, or having certain relationships with a hedge fund or private equity fund.
FDIC enforcement actions
The list of orders of administrative enforcement actions taken against banks and individuals in January 2015 has been released by the FDIC. Included were two consent orders; three section 19 orders; one civil money penalty; and one prompt corrective action. The civil money penalty of $5,400 was assessed upon a Montana bank for Flood Act violations. For details of that order, see the BOL Flood Penalties Watch page.
Puerto Rico bank closed
Doral Bank, San Juan, Puerto Rico, was closed by the Office of the Commissioner of Financial Institutions of Puerto Rico, which appointed the FDIC as receiver. The FDIC has entered into a purchase and assumption agreement with Banco Popular de Puerto Rico, Hato Rey, Puerto Rico, to acquire the banking operations, including all the deposits, of Doral Bank. Separate arrangements were made by Banco Popular to split the ownership of Doral Bank among Banco Popular and three other banks.
ID theft still at top of complaints list
The Federal Trade Commission has released its 2014 Consumer Sentinel Data Book, which contains the agency's national ranking of consumer complaints. Identity theft remains at the top of the list for the 15th consecutive year with imposter scams moving into the top three for the first time.
Reports from FATF plenary meeting
The Financial Action Task Force (FATF) has issued a number of releases following its recent plenary meeting in Paris:
The FATF is an inter-governmental body whose objectives are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.
CFPB Credit Union Advisory Council meeting scheduled
The CFPB Credit Union Advisory Council will meet with Director Cordray in Washington, D.C. on March 12 at 3:00 p.m. EDT. The meeting is open to the public but an emailed response to the CFPB is required. The meeting agenda and an event flyer were also released.
February 27, 2015
OFAC adds and removes SDNs
Treasury's Office of Foreign Assets Control has posted a Specially Designated Nationals List Update adding three individuals as Specially Designated Global Terrorists (SDGT) linked to Hizballah. Three related entities were also added. OFAC's notice also announced several deletions from the SDN List.
Mortgage rates dipped in January
The FHFA has announced released its January 2015 Monthly Interest Rate Survey (MIRS), which indicates interest rates on conventional purchase-money mortgages decreased from December 2014 to January 2015.
The National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders index was 3.88 percent for loans closed in late January, down 10 basis points.
The average interest rate on all mortgage loans was 3.89 percent, down 11 basis points.
The average interest rate on conventional, 30-year, fixed-rate mortgages of $417,000 or less was 4.06 percent, a decrease of 13 basis points.
The effective interest rate on all mortgage loans was 4.04 percent in January, down 11 basis points.
The average loan amount for all loans was $291,300 in January, down $7,000.
Comment period extended for proposed Capital Surcharge rule
The Federal Reserve Board has extended the comment period for its proposed rule to implement capital surcharges for the largest, most systemically important U.S. bank holding companies from March 2, 2015, to April 3, 2015. The proposed rule would establish a methodology to identify whether a firm is a global systemically important banking organization and would also establish the size of a firm's risk-based capital surcharge. The proposal is designed to further strengthen the capital positions of these institutions.
Second quarter CRA exam schedule
The FDIC has issued the public list of institutions that it has scheduled for a Community Reinvestment Act (CRA) examination during the second quarter of 2015.
Complaints filed against NY abusive debt collectors
The Federal Trade Commission and the New York State Office of the Attorney General have announced the filing of complaints aimed at shutting down 4 Star Resolution LLC and Vantage Point Services, LLC, two debt collection operations centered in Buffalo, New York, that target consumers nationwide. According to the complaints, the separate enterprises used threats and abusive language, including false threats that consumers would be arrested, to collect more than $45 million in supposed debts.
FDIC updates lawsuits data
The FDIC has updated its Professional Liability Lawsuits webpage to indicate that 14 additional suits were brought in January 2015. From January 1, 2009, through February 25, 2015, the FDIC has authorized suits in connection with 149 failed institutions against 1,195 individuals for D&O liability. This includes 105 filed D&O lawsuits (37 of which have fully settled and one of which resulted in a favorable jury verdict) naming 800 former directors and officers. The FDIC also has authorized 61 other lawsuits for residential mortgage-backed securities, LIBOR suppression, fidelity bond, insurance, accounting malpractice, appraiser malpractice, and attorney malpractice claims. In addition, 72 residential mortgage malpractice and fraud lawsuits are pending, consisting of lawsuits filed and inherited.
February 26, 2015
FATF meeting to focus on terrorist financing
The Financial Action Task Force (FATF) has commenced a three-day plenary meeting which brings together representatives from the organization's global network of over 190 countries. This meeting will have a particular focus on the issue of terrorist financing, and the financing of the terrorist organization ISIL.
FEMA to suspend communities in 11 states
The Federal Emergency Management Agency (FEMA) has published a final rule [80 FR 10359] in today's Federal Register identifying communities in Delaware, Florida, Georgia, Illinois, Kansas, Maryland, Michigan, Mississippi, New York, Pennsylvania, and Tennessee, where the sale of flood insurance has been authorized under the National Flood Insurance Program (NFIP) that are scheduled for suspension on March 16, 2015, because of noncompliance with the floodplain management requirements of the program.
January residential sales report mixed
HUD and the Census Bureau have released the January 2015 new residential sales report. Sales of new single-family houses in January 2015 were at a seasonally adjusted annual rate of 481,000, which was 0.2% below the revised December 2014 rate, but 5.3% above the January 2014 estimate.
February 25, 2015
OFAC Kingpin Act changes
The Department of the Treasury's Office of Foreign Assets Control (OFAC) has announced the addition of five Slovenian nationals and 14 entities to its SDN List. The additions were all made under the Kingpin Act, with the SDNTK designation. OFAC also updated its SDNTK designations by deleting listings of an individual and an entity, and changing the listing of another individual. Details can be found in OFAC's Recent Actions Update.
Since June 2000, more than 1,700 entities and individuals have been named pursuant to the Kingpin Act for their role in international narcotics trafficking. Penalties for violations of the Kingpin Act range from civil penalties of up to $1.075 million per violation to more severe criminal penalties. Criminal penalties for corporate officers may include up to 30 years in prison and fines up to $5 million. Criminal fines for corporations may reach $10 million. Other individuals could face up to 10 years in prison and fines pursuant to Title 18 of the United States Code for criminal violations of the Kingpin Act.
CFPB proposes one-year suspension of agreement submissions
The CFPB has announced a proposal to temporarily suspend for one year the obligations of credit card companies to submit consumer credit card agreements to the Bureau. The intent of the proposal is to improve the submission process and enable the data to be provided to consumers and users in a faster and more useable form. During the temporary suspension period, the CFPB will collect consumer credit card agreements from the largest card issuers' public websites and post the agreements to its online consumer credit card agreements database. The proposal is scheduled for publication in the Federal Register tomorrow, February 26, 2015. Comments on the proposal are due March 13, 2015.
FTC complaint against payday debt relief operation
A Federal Trade Commission press release has announced the filing of a complaint in federal district court against Payday Support Center, LLC, (now known as PSC Administrative, LLC), a deceptive debt relief operation, that has targeted consumers with outstanding payday loans. The defendants claimed they could help resolve those debts but then providied little or none of the financial relief they promised. As a result, many consumers stopped making payments to the original lenders and found themselves in even deeper financial trouble, having paid hundreds of dollars in fees for no benefit.
Yellen delivers Monetary Policy Report
Federal Reserve Board Chair Yellen appeared before the Senate Committee on Banking, Housing, and Urban Affairs to present the Federal Reserve's Semiannual Monetary Policy Report to the Congress and discuss the current economic situation and outlook.
Discount rate meeting minutes released
The Federal Reserve Board has released the minutes of its January 26, 2015, discount rate meeting.
G.20 Finance Companies report
The Federal Reserve has also released the December 2014 G.20 Finance Companies Owned and Managed Receivables Outstanding and Auto Loans: Terms of Credit Report.
Regulators issue youth savings program guidance and Q&A
The FRB, FDIC, FinCEN, NCUA and OCC have announced the availability of guidance to encourage federally insured depository institutions to offer youth savings programs to expand the financial capability of young people. The guidance also provides answers to frequently asked questions related to the establishment of these programs.
Insured institutions earnings ups and downs
The FDIC has released the Quarterly Banking Profile for the Fourth Quarter 2014, a press conference video, and the remarks of Chairman Gruenberg on the report. The profile indicates commercial banks and savings institutions insured by the FDIC reported aggregate net income of $36.9 billion in the fourth quarter of 2014, down $2.9 billion from earnings reported a year earlier. The decline in earnings was mainly attributable to a $4.4 billion increase in litigation expenses at a few large banks. More than half of the 6,509 insured institutions reporting had year-over-year growth in quarterly earnings. Community banks earned $4.8 billion during the quarter, up $1.0 billion (27.7 percent) from a year earlier. The number of problem banks fell for the 18th consecutive quarter.
February 24, 2015
HUD guidance on lending to LGBT Americans
HUD has issued guidance to better serve lesbian, gay, bisexual and transgender (LGBT) Americans seeking to obtain a home loan. The guidance will help clarify the Equal Access to Housing in HUD Programs Regardless of Sexual Orientation or Gender Identity Rule (Equal Access Rule). HUD's guidance on program eligibility for HUD assisted and insured housing programs includes an equal access provision making clear that housing that is financed or insured by HUD must be made available without regard to actual or perceived sexual orientation, gender identity, or marital status. In addition, the guidance also makes clear that sexual orientation and gender identity should not and cannot be part of any lending decision when it comes to getting an FHA-insured mortgage.
New webpage for FBAR filers
FinCEN has announced the launch of a new informational web page for those filing a Report of Foreign Bank Account (FBAR). Individuals and institutions can determine if they are required to file a FBAR and also find numerous resources for assistance if a filing is necessary. The FBAR filing deadline is June 30, 2015.
Update on check debit transaction changes
Federal Reserve Financial Services has issued information on the upcoming changes to Part II of the FRB Payment System Risk policy. The changes, which were announced on December 1, 2014, are designed to enhance the efficiency of the payment system, to align posting times with current operations and processing times, and to strategically position the rules for future advancements in the speed of clearing and settlement. These changes will become effective July 23, 2015, in coordination with amendments to Regulation J (12 CFR Part 210) that will become effective the same day.
FDIC on regulatory capital reporting changes
FDIC FIL-10-2015 has been issued concerning the approval of revisions to the reporting of risk-weighted assets in Part II of Schedule RC-R, Regulatory Capital, of the Consolidated Reports of Condition and Income (Call Report). These changes to Schedule RC-R, Part II, incorporate the standardized approach for calculating risk weighted assets under the banking agencies' revised regulatory capital rules. A limited change to Schedule RC-L, Derivatives and Off-Balance Sheet Items, revises the reporting of securities borrowed. Subject to approval by the U.S. Office of Management and Budget, these Call Report changes will take effect March 31, 2015. Yesterday's BOL Top Stories reported the scheduling of a teleconference to explain the revisions to Parts I and II of Schedule RC-R and Schedule RC-L tomorrow, February 25, 2015, from 2:00 to 4:00 p.m. ET.
CFPB announces field hearing on arbitration
A field hearing on arbitration has been scheduled by the CFPB for Newark, New Jersey, on March 10 at 11 a.m. ET. The location of the hearing is to be announced. The event is open to the public but requires an emailed reservation.
OCC January enforcement actions
The Office of the Comptroller of the Currency has published a list of new enforcement actions recently taken against national banks, federal savings associations, and individuals currently and formerly affiliated with national banks and federal savings associations has been released. The actions included a $5,005 Civil Money Penalty (CMP) imposed on an Ohio bank for violations of the Flood Disaster Protection Act (Flood Act). See the BOL Flood Penalties Watch page for more information.
Agencies continue regulatory review
The OCC, FRB, and FDIC have jointly issued a reminder of their continuing review of the regulations they have issued to identify outdated, unnecessary, or unduly burdensome regulations for insured depository institutions. The review is required by section 2222 of the Economic Growth and Regulatory Paperwork Reduction Act of 1996 ("EGRPRA"). The agencies have divided their regulations into 12 categories and requested comments in June 2014 for three categories (Applications and Reporting, Powers and Activities, and International Operations). This notice seeks comment on regulations in three additional categories: Banking Operations, Capital, and the Community Reinvestment Act. Comments will be accepted until May 14, 2015.
Teleconference on Call Report changes
FDIC FIL-6-2015 has been issued to announce that the banking regulatory agencies, under the auspices of the FFIEC, will hold on February 25, 2015, a teleconference for depository institutions that file the Call Report. The program will run from 2:00 to 4:00 p.m., EST. The agencies will discuss the revisions to Call Report schedules RC-R part II and RC-L and respond to questions about the regulatory capital reporting changes. Presentation materials for the teleconference will be available on the FFIEC's website the day before the presentation. Participants also are encouraged to have copies of the revised reporting forms and the related instructions available for reference during the teleconference.
NCUA Small Business Lending Resource Center launched
The NCUA has announced the launch of a new webpage from which credit unions can obtain information regarding member business lending. The site provides detailed information about NCUA's member business lending rules and regulations, supervisory guidance, links to the Small Business Administration's loan programs and related articles from The NCUA Report.
GAO report on FEMA implementation of Biggert-Waters Act
The Government Accountability Office has published a report, "Flood Insurance: Status of FEMA's Implementation of the Biggert-Waters Act, as Amended." The report describes (1) FEMA's management of the acts' [Biggert-Waters and the Homeowner Flood Insurance Affordability Act] implementation and associated challenges and (2) the status of FEMA's implementation of selected requirements from the acts. GAO analyzed the Biggert-Waters Act and HFIAA; reviewed FEMA information on the prioritization and tracking of implementation efforts in relation to relevant internal control standards; and reviewed data and documentation on FEMA's status in implementing the Biggert-Waters Act, as amended by HFIAA, in relation to established time frames.
February 20, 2015
IRS warns preparers of phishing scams
The Internal Revenue Service has issued a press release alerting tax preparers to illicit emails purporting to come from the IRS seeking personal or professional information. As with other phony emails claiming to emanate from the agency, the latest illicit emails are attempts to steal personal information. The bogus message asks tax professionals to update their IRS e-services portal information and Electronic Filing Identification Numbers (EFINs). The links that are provided in the bogus email to access IRS e-services appear to be a phishing scheme designed to capture usernames and passwords, perhaps with an ultimate goal of being able to file, undetected, multiple phony tax returns. The release also includes a link to the agency's "Dirty Dozen" list of IRS tax scams.
Branches preferred over mobile
The FDIC has released the results of a study showing that, despite the increased use of online and mobile banking, brick-and-mortar banking offices continue to be the primary means through which FDIC-insured institutions deliver financial services to their customers. FDIC-insured institutions operated 94,725 banking offices as of June 2014, a decline of just 4.8 percent from the all-time high of 99,550 offices in 2009.
NCUA Board Action Bulletin
A Board Action Bulletin has been issued by the NCUA reporting the actions taken at the February 19, 2015, meeting of its Board.
Agencies to host Small Business Lending webinar
A joint webinar, "Balancing Member Business Loan Portfolios with SBA Guarantees," will be hosted by the NCUA and the SBA on March 4, 2015, at 2 p.m. ET. The 90-minute webinar is the first initiative of the new NCUA-SBA partnership offering a series of educational initiatives during the next three years that include webinars, examiner training on SBA programs, data resources and media outreach.
Free credit scores for over 50 million consumers
The CFPB has announced that more than 50 million consumers now have free and regular access to their credit scores through their monthly credit card statements or online. The agency also released a report, "Consumer voices on credit reports and scores," with results from focus groups of consumers who were checking their credit scores and reports, how they were doing it, and what motivated them to check them. Links were provided to a list of the consumer reporting agencies and a document for consumers, "Check Your Own Credit Report."
Term deposit auction results
The results of the Federal Reserve's February 19, 2015, floating-rate offering of term deposits have been released.
Submission errors: invalid file format and invalid timestamp
Secured e-mails notice
Missing and overdue edit reports
Checks from Independent Foreclosure Review to be reissued
The Federal Reserve Board and OCC have issued a joint press release to announce that checks related to the Independent Foreclosure Review Payments Agreements that have not yet been negotiated are to be reissued. Beginning in April 2013, nearly 4.2 million checks totaling $3.6 billion were issued to borrowers as part of the settlement. As of last month, more than 3.4 million of those checks (over $3.1 billion) had been cashed. The remaining checks have expired. The agencies have directed the paying agent for the settlement to search again for updated addresses, and reissue the expired checks.
E-payments directory move rescheduled
Federal Reserve Financial Services has announced that February 22, 2015, is the revised date for the move of the E-Payments Routing Directory to a new web address. The directory's appearance will also be updated to better match that of FRBservices.org.
Mortgage rule published
The Consumer Financial Protection Bureau has published [80 FR 8767] its final rule, announced on January 20, 2015, that delays the deadline to the third business day for revised Loan Estimates resulting from rate locks; adds a Loan Estimate disclosure about revised estimates for some construction loans; makes some technical corrections to the final Integrated Disclosures rule; and adds the Integrated Disclosures to documents requiring loan originators' names and, if issued, NMLSR IDs.
Extension of resolution plans deadline
The Federal Reserve Board and FDIC have announced an extension of the resolution plan submission deadline for American International Group, Inc., General Electric Capital Corporation, Inc., and Prudential Financial, Inc. The three organizations will be required to submit their second annual plans by December 31, 2015, instead of July 1, 2015.
The minutes of the January 27–28, 2015, meeting of the Federal Open Market Committee have been released.
January 2015 residential construction report
HUD and the Census Bureau have released the residential construction statistics for January 2015. Building permits and housing starts were down and housing completions were mixed.
Indian housing block grants
HUD has announced Indian Housing Block Grant (IHBG) allocations of more than $651 million to 586 Native American tribes in 34 states. The allocations are distributed each year to eligible Indian tribes or their tribally designated housing entities for a range of affordable housing activities.
Term Deposit Facility (TDF) auction
The Federal Reserve will conduct today a floating-rate offering of term deposits with an early withdrawal feature through its Term Deposit Facility (TDF). Twenty-one-day term deposits will be offered with a rate set equal to the sum of the interest rate paid on excess reserves (currently 25 basis points) plus a fixed spread of 3 basis points. The maximum tender amount per institution will be $20 billion.
February 2015 NCUA Report
The February 2015 issue of The NCUA Report has been posted.
ECOA Report to CFPB
The Federal Trade Commission has issued a letter with its annual report to the CFPB on the Commission's activities related to the enforcement of the Equal Credit Opportunity Act (ECOA).
February 18, 2015
Narcotics trafficker and scaffolding company added to SDN List
Treasury has announced the designation of a Mexican national, Francisco Javier Gastelum Serrano, and Andamios Dalmine SA, the Mexico City-based scaffolding company of which he is president, as Specially Designated Narcotics Traffickers (SDNTKs) under the Foreign Narcotics Kingpin Designation Act. He is the fifth Serrano brother, all members of the Gastelum Serrano drug trafficking network, to be designated. Details of the listing are included in an OFAC SDN List Update.
Sudan General License published
Treasury also announced that, in consultation and coordination with the Departments of State and Commerce, it is issuing an amended general license relating to the exportation, reexportation, and provision to Sudan of certain hardware, software, and services incident to personal communications. Treasury's Office of Foreign Assets Control also published related Frequently Asked Questions.
February 17, 2015
FDIC posts Mortgage Rules video
The release of the third in a series of three technical assistance videos developed to assist bank employees in meeting regulatory requirements has been announced by the FDIC. This video focuses on the Mortgage Servicing Rules with particular emphasis on those entities that qualify for the "Small Servicer" exemption. The video series addresses compliance with certain mortgage rules issued by the Consumer Financial Protection Bureau (CFPB). The first video, released on November 19, 2014, covered the Ability to Repay and Qualified Mortgage Rule. The second video, released on January 27, 2015, covered the Loan Officer Compensation Rule.
Georgia bank closed
The FDIC has announced that Capitol City Bank & Trust Company, Atlanta, Georgia, has been closed by the Georgia Department of Banking and Finance. The FDIC, which was appointed receiver, entered into a purchase and assumption agreement with First-Citizens Bank & Trust Company, Raleigh, North Carolina, to assume all of the deposits of Capitol City Bank & Trust Company. This was the third failure of an FDIC-insured institution reported this year, and the first in Georgia.
CFPB promotes savings for children
In conjunction with America Saves Week, an article on the CFPB Blog suggests ways parents or caregivers can help children from toddlers to teens and beyond develop good financial habits.
February 2015 FedFlash
Federal Reserve Bank Services has posted the February 2015 issue of FedFlash, featuring articles on:
HUD confirms points and fees limits adjustment
The Department of Housing and Urban Development has published a final rule [80 FR 8243] to clarify that all annual adjustments to the qualified mortgage points and fees limit at 12 CFR 1026.43(e)(3) issued by the Consumer Financial Protection Bureau apply to HUD's points and fees limit provision at 24 CFR 203.19. HUD's final rule is effective upon publication, and affects single-family residential mortgages that HUD insures, guarantees or administers. Under HUD's qualified mortgage rule, qualified mortgage status attaches at origination and insurance endorsement to those single family residential mortgages insured under the National Housing Act (12 U.S.C. 1701 et seq.), section 184 loans for Indian housing under the Housing and Community Development Act of 1992 (12 U.S.C. 1715z-13a), and section 184A loans for Native Hawaiian housing under the Housing and Community Development Act of 1992 (12 U.S.C. 1715z-13b).
February 13, 2015
CFPB takes on mortgage companies for deceptive ads
The CFPB has announced the filing of a complaint and the issuance of administrative consent orders against three mortgage companies. The Bureau alleges the companies misled consumers with advertisements implying U.S. government approval of their products. A complaint was filed against All Financial Services, a mortgage broker and lender in Maryland, New Jersey, Pennsylvania, and Washington, D.C. Consent orders were issued against Flagship Financial Group, LLC, headquartered in Utah and licensed as a mortgage broker or lender in 35 states; and against American Preferred Lending, headquartered in California and a mortgage lender and mortgage broker in California. American Preferred is also a mortgage loan originator in Florida.
OCC replaces Comptroller's Handbook booklet
The OCC has issued Bulletin 2015-13 announcing the addition of the "Deposit-Related Consumer Credit" booklet of the Comptroller's Handbook. The new booklet provides updated guidance and examination procedures that OCC examiners will use to assess a bank's deposit-related consumer credit activities. It replaces the "Check Credit" booklet issued in March 1990.
Stress test results release schedule
The Federal Reserve Board has announced that the results from the latest Dodd-Frank supervisory stress tests will be released on March 5, 2015, and the related results from the Comprehensive Capital Analysis and Review (CCAR), will be released on March 11, 2015.
Term deposit offering results
The results of the February 12, 2015, offering of 21-day term floating-rate term deposits have been released by the Federal Reserve.
Regulators promote Military Saves and America Saves Week
A press release has been issued by the FDIC encouraging consumers to use America Saves Week as a time to begin or continue saving towards financial goals. America Saves Week, which runs from February 23–28, 2015, is an annual opportunity for organizations to encourage consumers to make a savings commitment, and then provide access to ideas, tools, and other helpful resources to help consumers develop a plan to achieve their goal. The agency provided educational resources developed by the FDIC to help consumers evaluate savings options to achieve their savings goals.
The NCUA has announced that a live Twitter chat will be available on February 26, 2015, beginning at 11 a.m. ET, for credit unions and their members to share strategies for developing positive savings behavior during Military Saves and America Saves Week. Credit unions and consumers can follow @MyCUgov and contribute to the conversation using the #NCUAChat hashtag on Twitter.
OCC Bulletin on small-loan exemption threshold
The Office of the Comptroller of the Currency has issued Bulletin 2014-15 to remind its supervised banks and savings associations of the revision to its higher-priced mortgage loan (HPML) appraisal rule. The revision adjusts the HPML exemption threshold for smaller loan transactions based on the annual percentage change in a measure of the consumer price index. The revision, which came effective January 1, 2015, was published in the Federal Register on December 30, 2014. The OCC's rule is required by the Dodd-Frank Act, but it tracks section 1026.35(c) of the Bureau's Regulation Z.
Federal Advisory Council minutes
The minutes of the February 6, 2015, meeting of the Federal Advisory Council have been posted by the Federal Reserve Board. The Council, comprising twelve representatives of the banking industry, consults with and advises the Board on all matters within the Board's jurisdiction. The council ordinarily meets four times a year, the minimum number of meetings required by the Federal Reserve Act.
Term deposit auction announced
The Federal Reserve's Term Deposit Facility will conduct a floating-rate offering of term deposits today, February 12, 2015. Twenty-one-day term deposits will be offered with a rate set equal to the sum of the interest rate paid on excess reserves (currently 25 basis points) plus a fixed spread of 3 basis points. Early withdrawal penalties will apply. The maximum tender amount per institution will be $20 billion.
Agencies develop tool for calculating capital requirements
OCC Bulletin 2015-14 and FDIC FIL-7-2015 have announced the
development by the OCC, FRB, and FDIC of an automated Excel spreadsheet tool to help banks and savings associations calculate risk-based capital requirements for securitization exposures under the revised capital rule.
New members of FDIC Advisory Committee
The selection of seven new members of the FDIC Advisory Committee on Community Banking has been announced. The Committee provides advice and recommendations to the FDIC on a broad range of community bank policy and regulatory matters. Its members represent a cross-section of community bankers from around the country.
NCUA Board meeting video Available
The video recording of the January 15, 2015, meeting of the NCUA Board has been posted.
February 11, 2015
Deceptive mortgage ads and kickbacks earn Bureau action
The Consumer Financial Protection Bureau has announced it has issued a Consent Order against NewDay Financial, LLC for deceptive mortgage advertising and kickbacks. The CFPB found NewDay deceived consumers about a veterans' organization's endorsement of NewDay products and participated in a scheme to pay kickbacks for customer referrals. NewDay will pay a $2 million civil money penalty for its actions. The Order also requires that NewDay may not deceptively market mortgage credit products, may not enter into business relationships involving third-party endorsements inconsistent with FTC guidance, and must make no payments for referrals.
OCC revises personal fiduciary activities booklet
The Office of the Comptroller of the Currency has issued Bulletin 2015-12 announcing the publication of a revised "Personal Fiduciary Activities" booklet, a part of the Comptroller's Handbook. The new booklet, which replaces a similarly titled booklet issued in August 2002,
updates references to laws and regulations to include those applicable to federal savings associations
clarifies and expands guidance applicable to current business practices, particularly when banks act as directed trustees under state trust laws
updates risk management guidance
provides a sample personal fiduciary activities examination request letter
Cordray on proposed mortgage rules amendments
In prepared remarks at a NCUA Town Hall webinar, CFPB Director Cordray discussed the Bureau's recently proposed amendments to mortgage rules affecting small creditors. The proposal was published [80 FR 7769] this morning in the Federal Register. Comments are due by March 30, 2015.
NMLS annual conference agenda
The NMLS has posted the agenda for its 7th Annual Conference, which will be held in San Diego on February 16–19, 2015.
February 10, 2015
Reverse mortgage Consumer Advisory and complaint report
The CFPB announced its release of a report of 1,200 reverse mortgage complaints received by the agency from December 1, 2011 to December 31, 2014. The Bureau also posted a Consumer Advisory listing three steps a consumer with a reverse mortgage should take:
Verify who is on the loan
If the reverse mortgage is in the name of only one spouse, make a plan for the non-borrowing spouse
Talk to children and heirs—make a plan for any non-borrower family members living in the home
OCC directors workshop in San Antonio
The OCC will host a workshop in San Antonio on March 16–18, 2015, for directors of national community banks and federal savings associations. The "Building Blocks for Directors" workshop is geared toward orienting new bank directors and still has a wide enough appeal for all community bank directors.
FinCEN to extend requirements
FinCEN has published in this morning's Federal Register three notices relating to submissions to the Office of Management and Budget for approvals of extensions or renewals without change of current collections of information:
80 FR 7526: Suspicious activity reporting requirements for residential mortgage lenders and originators
80 FR 7527: Registration of Money Services Business, FinCEN Form 107
NCUA and SBA to help small businesses get credit
The NCUA and the SBA have announced the signing of a Memorandum of Understanding outlining a series of educational initiatives during the next three years that include webinars, examiner training on SBA programs, data resources and media outreach. The primary objective of the collaboration is increasing credit union awareness of SBA programs.
OCC Bulletin on revision of CRA asset thresholds
OCC Bulletin 2015-10 has been issued to remind constituent banks and savings associations of the previously announced revisions to Community Reinvestment Act (CRA) regulations that became effective January 1, 2015. The revisions adjust the asset-size thresholds used to define "small bank," "small savings association," "intermediate small bank," and "intermediate small savings association." The revisions were published in the Federal Register on December 29, 2014, and covered in BOL Top Stories.
Public meeting on proposed CIT Group acquisition
The Federal Reserve Board and the Office of the Comptroller of the Currency have announced a joint public meeting on the proposal by CIT Group, Inc., Livingston, New Jersey, to acquire IMB Holdco and its subsidiary, OneWest Bank, National Association, both of Pasadena, California. The proposal also includes the merger of CIT Bank into OneWest Bank. The public meeting will be held at the Los Angeles Branch of the Federal Reserve Bank of San Francisco on February 26, 2015, beginning at 8:00 a.m. PST. All persons wishing to testify at the public meeting must submit a written request no later than 5:00 p.m. PST on February 20, 2015.
February 6, 2015
FTC stops mortgage mod 'experts'
The Federal Trade Commission has announced proposed settlements with a group of Utah-based defendants claiming to be legal experts in loan modifications. The agency filed a complaint in federal district court charging that the defendants broke the law by conning consumers into paying hefty fees for worthless mortgage relief services. The five proposed orders settling the FTC's charges ban the defendants, led by Philip J. Danielson and Danielson Law Group, from offering mortgage assistance relief services and from participating in the debt relief industry. The proposed settlements also impose a $28.6 million judgment against all the defendants, reflecting the total amount of fees taken in by the scheme. The proposed judgment will be suspended as to the individual defendants provided they surrender certain of their assets, including a $200,000 house in Utah, as required by the settlement orders.
OCC Risk Governance and Credit Risk workshops
The OCC will host two workshops on risk governance and credit risk in Morristown, NJ, on March 10-11, for directors of national community banks and federal savings associations. The Risk Governance workshop on March 10 will focus on the OCC's approach to risk-based supervision and major risks in the financial industry. The Credit Risk workshop on March 11 will look at credit risk within the loan portfolio, such as identifying trends and recognizing problems.
FSOC changes nonbank designation process
The Treasury Financial Stability Oversight Council (FSOC) has announced that it voted at its February 4, 2015, meeting to adopt certain changes and formalize certain practices relating to its process for reviewing nonbank financial companies for potential designation. Nonbank financial companies that are designated by the Council are subject to consolidated supervision by the Board of Governors of the Federal Reserve System and enhanced prudential standards.
NMLS maintenance scheduled
The NMLS has announced that its Consumer Access portal will be unavailable from 10:00–11:59 p.m. ET on Saturday, February 7, 2015, due to system maintenance.
Term deposit offering results
The Federal Reserve System has announced the results of its February 5, 2015, floating-rate offering of term deposits. There were 87 participants in the offering, and 21-day deposits totalling over $188 billion were accepted. This was the first in a series of offerings that settled on the offering date.
Curry on Federal branches and agencies
In remarks delivered at the Federal Agencies and Branches Outreach meeting in New York, Comptroller Curry discussed the important role federal branches and agencies play in the financial system.
February 5, 2015
Subprime credit card company to refund $2.7M
The CFPB has ordered Continental Finance Company LLC, a Delaware subprime credit card company, to refund an estimated $2.7 million to approximately 98,000 consumers who were charged illegal credit card fees. The agency found that the company's "fee-harvester" subprime credit cards misrepresented certain fees and hit consumers with illegal charges. The order also requires the company to pay a civil penalty of $250,000.
U.S. Bank, N.A. to pay Peregrine customers $18M
The U.S. Commodity Futures Trading Commission (CFTC) has announced that a Consent Order imposing a permanent injunction has been entered by the U.S. District Court for the Northern District of Iowa against U.S. Bank National Association (U.S. Bank), ordering the bank to pay $18 million dollars to be returned to customers of Peregrine Financial Group, Inc. (PFG). The Order also enjoins U.S. Bank from committing future violations of the Commodity Exchange Act (CEA) and the CFTC's Regulations that prohibit any depository institution, like U.S. Bank, from holding, disposing of, or using funds that belong to customers of an FCM as though they belong to anyone other than the customers, and also prohibit the extension of credit based on such funds to anyone other than the customers. A Complaint filed by the CFTC alleged that PFG and Russell Wasendorf, Sr, its owner, committed fraud by misappropriating customer funds, violated customer fund segregation laws, and made false statements in financial statements filed with the Commission. According to the Complaint, in July 2012 during an NFA audit, PFG falsely represented that it held in excess of $220 million of customer funds when in fact it held approximately $5.1 million.
Treasury implements Terrorism Risk Insurance program
Treasury has announced it has begun implementing the Terrorism Risk Insurance Program Reauthorization Act of 2015 (Reauthorization Act), which was signed into law on January 12, 2015. As part of this implementation, Treasury's Federal Insurance Office (FIO) released Interim Guidance. The FIO also released a notice that will be published in the Federal Register seeking public comment regarding potential improvements to the process for certifying an event as an "act of terrorism." These comments will be used by FIO in the completion of a study and report required by the Reauthorization Act, as well as in the formation of final rules related to the certification process.
Corrections to CFPB Prepaid Products proposal
The Bureau has published in this morning's Federal Register a number of technical corrections to its December 23, 2014 (79 FR 77101) proposal that would add significant new consumer protections for prepaid cards to Regulations E and Z. Most of the corrections involve links to documents in the footnotes to the December 23 document and various typographical errors. None of the changes are substantive.
Treasury testifies on changes to OFAC Cuba regulations Written testimony has been presented to the House Foreign Affairs Committee regarding the key regulatory amendments made by Treasury's Office of Foreign Assets Control (OFAC) to implement changes to U.S. policy toward Cuba announced by the President, as well as the restrictions that remain in place. The changes include easing of travel restrictions and remittances, increasing access to financial services, telecommunications, and discussions to reestablish diplomatic relations.
Term deposit offering announced
The Federal Reserve will conduct on February 5, 2015, a floating-rate offering of term deposits with an early withdrawal feature through its Term Deposit Facility (TDF). Twenty-one-day term deposits will be offered with a rate set equal to the sum of the interest rate paid on excess reserves (currently 25 basis points) plus a fixed spread of 3 basis points. The maximum tender amount per institution will be $20 billion. The operation window will be open from 10:30 a.m. to 12:30 p.m. ET, and awarded deposits will settle the same day the operation is executed.
CRA ratings released by FDIC
The FDIC has issued its list of fifty-nine state nonmember banks recently evaluated for compliance with the Community Reinvestment Act (CRA). Six received an outstanding rating, fifty-two received a satisfactory, and one institution received a needs-to-improve rating.
February 4, 2015
Bureau announces student loan forgiveness agreement
The Bureau has announced and posted an article about more than $480 million in forgiveness for borrowers who took out high-cost private student loans from Corinthian College. ECMC Group, the new owner of a number of Corinthian schools, will not operate a private student loan program for seven years and agreed to a series of new consumer protections. The Bureau also published a Special Bulletin for current and former students of schools previously owned by Corinthian Colleges. Inc.
Sham credit card company shut down
The CFPB has asked a federal court to approve a proposed consent order with a Texas-based company that would permanently ban that company from offering any consumer credit products or services, after it duped thousands of consumers into signing up for a sham credit card. In December 2014, the CFPB filed a lawsuit against Union Workers Credit Services alleging that the vast majority of the company's revenue was generated from selling a buying-club membership card that it falsely advertised as a general-purpose credit card. In reality, the card could only be used to buy products from the company. Most consumers never used the membership card but could not recoup their membership fees. The company would also be required to pay a penalty of $70,000.
New 314(a) Fact Sheet released
FinCEN has issued new 314(a) Fact Sheet about the information shared by financial institutions with law enforcement to help locate financial assets and recent transactions by subjects of criminal investigations.
FTC settles with cross-border telemarketers
The FTC has announced that two defendants who participated in an alleged multi-million dollar telemarketing fraud that targeted U.S. seniors and withdrew money from their accounts without authorization have agreed to settle Federal Trade Commission charges. A complaint filed by the FTC contended the defendants established a network of U.S. and Canadian entities to carry out their scam by cold-calling seniors claiming to sell fraud protection, legal protection, and pharmaceutical benefit services. The settlement orders bar them from using remotely created checks drawn on consumers' bank accounts, require them to obtain consumers' consent before debiting their accounts, and prohibit them from misrepresenting any goods or services.
Banned Debt Collectors Hall of Shame announced
The FTC has announced the creation of a "Hall of Shame" list of abusive debt collectors who have been identified by the agency. The crime is second only to identity theft in complaints received by the FTC. Since January 1, 2010, the FTC has sued over 180 companies and individuals who broke the law, banning 63 from the industry, and securing more than $220 million in judgments.
CFPB Consumer Advisory Board meeting
A meeting of the CFPB Consumer Advisory Board with Director Cordray will be held in Washington, D.C. on February 19, 2015 from 10 a.m. to 4 p.m. ET. During this meeting, trends and themes related to consumer financial well being and medical debt will be discussed. The meeting is open to the public. Registration is required and a recording will be available after the event. The Bureau posted the meeting agenda and an event flyer with additional information.
OCC Minority Depository Advisory Committee meeting
The OCC has announced it will host a public meeting of the Minority Depository Institutions Advisory Committee (MDIAC) in its Washington, D.C. office on February 18, 2015, beginning at 8:30 a.m. ET. The meeting is open to the public. Attendees should contact the OCC by 5:00 p.m. ET on February 12, 2015 by e-mail or by mail.
February 3, 2015
CRA ratings released
The OCC has released the ratings received by forty-eight national banks and federal savings associations that were recently examined for CRA compliance. Eight were rate outstanding and forty were rated satisfactory.
Treasury publishes Ukraine-related general licenses
Three Ukraine-related general licenses — General License 6, "Noncommercial, Personal Remittances Authorized"; General License 7, "Operation of Accounts Authorized"; and General License 8, "Transactions Related to Telecommunications and Mail Authorized" — have been published by Treasury. These licenses authorize certain transactions that would otherwise be prohibited pursuant to Executive Order 13685 of December 19, 2014, "Blocking Property of Certain Persons and Prohibiting Certain Transactions With Respect to the Crimea Region of Ukraine."
Board releases legal interpretations
The Federal Reserve Board has released six letters granting requests for relief from commitments made in connection with the acquisition of securities issued a part of the Troubled Asset Relief Program's Capital Purchase Program.
January 2015 SLOOS published
The Federal Reserve Board has published the January 2015 Senior Loan Officer Opinion Survey (SLOOS) on Bank Lending Practices, which addressed changes in the standards and terms on, and demand for, bank loans to businesses and households over the past three months.
Fed schedules Term Deposit Facility operations
The Federal Reserve has announced plans to conduct a series of three overlapping 21-day term deposit operations with an early withdrawal feature beginning in February. Term deposits in this series will settle on the same day as the operation is executed, eliminating the three-day lag between the execution of an operation and settlement in previous tests. The operations will employ a floating-rate format, with the rate set equal to the sum of the interest rate on excess reserves (currently 25 basis points) plus a fixed spread of 3 basis points. The maximum individual award amount per operation will be set at $20 billion. The Term Deposit Facility Resource Center has additional information.
NCUA to host fair lending webinar
The NCUA will host a free webinar, "Fair Lending and HMDA Compliance," on February 20, 2015, beginning at 2 p.m. ET. Representatives of the NCUA Office of Consumer Protection will provide an overview of the agency's fair lending examination program. They will also outline best practices that can help credit unions of all asset sizes better comply with fair lending requirements. In addition, webinar participants will have the opportunity to learn more about reporting requirements under the Home Mortgage Disclosure Act (HMDA), as well as the most common reporting errors made by credit unions.
February 2, 2015
FDIC December enforcement actions
The FDIC has released the list of orders of administrative enforcement actions taken against banks and individuals in December 2014. Fifty-three orders and one notice were issued. The orders included: five consent orders; thirteen removal and prohibition orders; eleven section 19 orders; fifteen civil money penalty (CMP) orders (all against individuals); and nine orders terminating consent orders and cease and desist orders. Of the CMPs, four totaling $775,000 involved individuals associated with United International Bank, Flushing, New York, and seven totaling $40,000 involved individuals associated with Voyager Bank, Eden Prairie, Minnesota.
FDIC cleaning regulatory house
The FDIC has published two final rules and two proposed rules relating to regulations transferred from the OTS.
Final rule [80 FR 5015] rescinding and removing the former OTS regulation "Possession by Conservators and Receivers for Federal and State Savings Associations," subpart N of 12 CFR Part 390, effective March 2, 2015
Final rule [80 FR 5009] rescinding and removing 12 CFR Part 390, subparts B, C, D, and E (former OTS 12 CFR Parts 508, 509, 512 and 513), effective March 2, 2015
Proposed rule [80 FR 5069] that would rescind and remove 12 CFR Part 391, subpart C, "Fair Credit Reporting," and amend 12 CFR Part 334, also entitled "Fair Credit Reporting," to extend its scope to include State savings associations and their subsidiaries. The proposal would also amend the definitional portion of its ID Theft Red Flags regulations to conform with the Red Flag Program Clarification Act of 2010, and rescind and remove those portions of its "Fair Credit Reporting" regulations for which the rule writing authority was transferred to the CFPB. Comments are due by March 31, 2015
Proposed rule [80 FR 5052] that would rescind and remove 12 CFR Part 391, subpart B ("Safety and Soundness Guidelines and Compliance Procedures") and Appendices A and B to subpart B and Supplement A to appendix B, and make appropriate amendments to 12 CFR Parts 308 and 364 to expand their scopes to include State savings associations and subsidiaries. Comments are due by March 31, 2015
Philadelphia credit union liquidated
The National Credit Union Administration has announced the liquidation of American Bakery Workers Federal Credit Union, Philadelphia, Pennsylvania. The members, deposits and a majority of the loan portfolio were immediately assumed by TruMark Financial Credit Union of Trevose, Pennsylvania. American Bakery FCU served more than 107,000 members and had assets of nearly $1.6 billion. It was the first federally insured credit union liquidated in 2015.
FTC settles complaints with car title lenders
The Federal Trade Commission has announced that settlements have been reached on two complaints filed against car title lenders. A car title loan is typically a high cost, short-term loan, secured with the consumer's car title. In the administrative complaints issued against the title lenders, First American Title Lending of Georgia, LLC, and Finance Select, Inc., the FTC charged that the companies advertised, both online and in print, zero percent interest rates for a 30-day car title loan without disclosing important loan conditions or the increased finance charge imposed after the introductory period ended. The settlements require the lenders to stop their use of deceptive advertising to market title loans.
January 30, 2015
Bureau proposes more changes to mortgage rules
The Consumer Financial Protection Bureau has announced several more proposed changes to its mortgage rules to facilitate responsible lending by small creditors, particularly in rural and underserved areas. If finalized, the latest proposal would increase the number of financial institutions able to offer certain types of mortgages in rural and underserved areas, and help small creditors adjust their business practices to comply with the new rules. The proposed amendments would:
Expand the definition of "small creditor"
Include mortgage affiliates in calculation of small-creditor status
Expand the definition of "rural" areas
Provide grace periods for small creditor and rural or underserved creditor status
Create a one-year qualifying period for rural or underserved creditor status
Provide additional implementation time for small creditors
The proposal would make several additional minor or technical changes to the rules. The proposed rule [Note: Published 2/11/2015 at 80 FR 7769] will be open for public comment until March 30, 2015.
FHA offers reverse mortgage foreclosure alternative
HUD has issued a press release to publicize FHA Mortgage Letter 2015-03, which announces a new policy under its Home Equity Conversion Mortgage (HECM) Program that gives FHA-approved lenders the option to delay calling HECMs with eligible "non-borrowing spouses" due and payable. A delay would postpone foreclosure normally triggered by the death of the last surviving borrower. FHA's new guidance will permit reverse mortgage lenders to assign eligible HECMs to HUD upon the death of the last surviving borrowing spouse, thereby allowing eligible surviving spouses the opportunity to remain in the home despite their non-borrowing status.
Regulator guidance on private student loans
A press release from the federal financial regulatory agencies (OCC, FRB, FDIC, NCUA and the CFPB), in partnership with the State Liaison Committee (SLC) of the Federal Financial Institutions Examination Council, announces the issuance of guidance for financial institutions on private student loans with graduated repayment terms at origination. The guidance provides principles that financial institutions should consider in their policies and procedures for originating private student loans with graduated repayment terms. The OCC also issued Bulletin 2015-7 on the subject.
FRB proposes raising small BHC threshold
The Federal Reserve Board has announced the issuance of a notice of proposed rulemaking (NPR) that would raise the asset size threshold for determining applicability of the Board's Small Bank Holding Company Policy Statement (Regulation Y, Appendix C) to $1 billion from $500 million and to expand the scope of the Policy Statement to include savings and loan holding companies that also meet the Policy Statement's requirements. Revisions to Reg Y, Reg LL and reporting requirements are also proposed. In addition, the proposal would eliminate quarterly consolidated financial reporting requirements (FR Y-9C) for bank holding companies and savings and loan holding companies that have less than $1 billion in total consolidated assets and meet the qualitative requirements of the Policy Statement, and instead require parent-only financial statements (FR Y-9SP). The proposal would also eliminate regulatory capital reporting for savings and loan holding companies with less than $500 million in total consolidated assets from the FR Y-9SP. Comments on the regulatory reporting changes will be accepted for 60 days after publication in the Federal Register.
OCC Bulletin on credit risk retention requirements
The OCC has issued Bulletin 2015-8 on the previously announced and published Final Rule to implement the credit risk retention requirements of section 15G of the Securities Exchange Act of 1934 (15 USC 78o-11), as added by section 941 of the Dodd-Frank Act. The Final Rule was previously issued and published in the Federal Register [79 FR 77601] by the OCC, FRB, FDIC, SEC, FHFA, and HUD on December 24, 2014 and reported in BOL Top Stories.
CFPB looking for ways to help student loan borrowers
The Bureau Blog features an article reviewing the plight of students who are struggling to manage their student loan debt. The text contains links to various resources that may be of assistance.
December mortgage interest rates decline slightly
The Federal Housing Finance Agency (FHFA) has released its December 2014 Index, which indicates, according to several indices of new mortgage contracts, nationally interest rates on conventional purchase-money mortgages decreased from November to December 2014.
FDIC encourages risk-based approach to customer assessments
FDIC FIL-5-2015 was issued Wednesday to encourage supervised institutions to take a risk-based approach in assessing individual customer relationships, rather than declining to provide banking services to entire categories of customers without regard to the risks presented by an individual customer or the financial institution's ability to manage the risk.
The agency included a statement that (1) it is aware that some institutions may be hesitant to provide certain types of banking services due to concerns that they will be unable to comply with the associated requirements of the Bank Secrecy Act (BSA), and (2) the FDIC and the other federal banking agencies recognize that as a practical matter, it is not possible for a financial institution to detect and report all potentially illicit transactions that flow through an institution. Isolated or technical violations, which are limited instances of noncompliance with the BSA that occur within an otherwise adequate system of policies, procedures, and processes, generally do not prompt serious regulatory concern or reflect negatively on management's supervision or commitment to BSA compliance.
A new, dedicated toll-free number, 800-756-8854, and dedicated email box (bankingservicesOO@fdic.gov) for the Office of the Ombudsman, have been established for institutions concerned that FDIC personnel are not following FDIC policies on providing banking services. Communications with the ombudsman are confidential.
NY AG gets Citibank ChexSystems policy commitment
New York Attorney General Eric Schneiderman has announced that Citibank, N.A. has agreed to adopt new policies governing its use of ChexSystems, a consumer reporting agency that is often used to screen people seeking to open checking or savings accounts. Citibank's new policies are expected to allow thousands of additional New Yorkers and consumers nationwide to open bank accounts by March 15, 2015. The change comes amid concerns that screenings by ChexSystems and other consumer reporting agencies, which are used by most of the nation's banks, adversely affect lower-income applicants and force them to turn to high-cost alternative financial services like check-cashing outlets.
With this agreement, Citibank now joins Capital One as the second bank to commit to overhaul its use of ChexSystems. According to the AG's release, although Citibank will continue screening customers for past fraud, it will revamp its so-called "account-abuse" screening so that applicants are not rejected for isolated or minor banking errors, such as paid debts or a small overcharge.
FSR and CFPB to promote financial education
The Financial Services Roundtable (FSR) has announced it will join the CFPB in a public-private initiative to join forces promoting effective financial education nationwide. The CFPB, through its Office of Financial Education, and the FSR will work together to facilitate the gathering and sharing of information about effective financial education strategies; to encourage adoption of financial education initiatives, especially in K-12 schools and in the workplace; and to protect older Americans from financial exploitation. CFPB and FSR will host a series of working groups and listening sessions at various locations throughout the country to determine best practices and a path forward.
FOMC statement released
The Federal Reserve Board has released the Federal Open Market Committee's statement on its December 2014 meeting. The Committee reaffirmed its view that the current 0 to ¼ percent target range for the federal funds rate remains appropriate. In determining how long to maintain this target range, the Committee will assess progress—both realized and expected—toward its objectives of maximum employment and 2 percent inflation. In addition, the Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction.
January 28, 2015
The CFPB has announced
the issuance of Compliance
Bulletin 2015-01 to remind supervised financial institutions,
including nonbank companies that may be unfamiliar with federal
supervision, of existing regulatory requirements regarding confidential
supervisory information. The bulletin provides guidance on what types
of information constitute confidential supervisory information. The
bulletin also explains that disclosure of confidential supervisory
information is not allowed, with limited exceptions.
Oppenheimer to pay
ongoing AML problems The
Financial Crimes Enforcement Network (FinCEN), and the Securities
and Exchange Commission (SEC) have announced the assessment
of a combined $20 million civil money penalty (CMP) against Oppenheimer
& Co., Inc., for willfully violating the Bank Secrecy Act
(BSA). The regulators contended that Oppenheimer (a securities
broker-dealer in New York) conducted suspicious penny stock trading,
that pump-and-dump schemes were not flagged, that a foreign
correspondent customer was allowed to conduct prohibited activity, and
that Oppenheimer failed to file SARs. The firm admitted that it failed
to establish and implement an adequate anti-money laundering program,
failed to conduct adequate due diligence on a foreign correspondent
account, and failed to comply with requirements under Section 311 of
the USA PATRIOT Act. Oppenheimer was assessed a $2.8 million CMP in
2005 by FinCEN and the New York Stock Exchange. In 2013, the financial
Industry Regulatory Authority (FINRA) fined the firm $1.4 million for
violations of securities laws and anti-money laundering failures.
report released by CFPB
A CFPB article
announces the release of a report on financial well-being and discusses
the four elements of financial well-being identified by consumers who
participated in the Bureau's study on the subject:
OFAC SDN List changes
The Department of the Treasury's OFAC Resource Center has posted a notice
announcing the addition of two individuals to the SDN Lists under the
Kingpin Act and one individual designated as a global terrorist. There
were also several listings removed from the Counter Narcotics
Designations lists (SDNTK and SDNT).
Compensation Rule video available
The FDIC has released
the second in a series of three new technical assistance videos
developed to assist bank employees in meeting regulatory requirements.
These videos address compliance with certain mortgage rules issued by
the Consumer Financial Protection Bureau (CFPB). The first video,
released on November 19, 2014, covered the Ability
to Repay and Qualified Mortgage Rule. The second video covers
Originator Compensation Rule, and the third video, expected
to be released in February 2015, will cover the Servicing Rule.
HUD and the Census Bureau have released
the December 2014 residential
sales data. Sales of new single-family houses in December
2014 were at a seasonally adjusted annual rate of 481,000 which was
11.6 percent above the revised November rate and 8.8 percent above the
December 2013 estimate. The median sales price of new houses sold in
December 2014 was $298,100 and the average sales price was $377,800.
January 27, 2015
OCC issues extreme
has been issued by the Office of the Comptroller of the Currency
allowing national banks and federal savings associations at their
discretion to close offices affected by extreme winter weather in the
northeast United States.
plan for improvement payments
The Federal Reserve has issued "Strategies
for Improving the U.S. Payment System," which presents a
multi-faceted plan for collaborating with payment system stakeholders,
including large and small businesses, emerging payments firms, card
networks, payment processors, consumers and financial institutions to
enhance the speed, safety and efficiency of the U.S. payment system.
The Federal Reserve's strategic direction for financial services
focuses on improving the end-to-end speed, safety and efficiency of the
payment system. The Federal Reserve undertook an extensive 18-month
research program aimed at identifying key gaps and opportunities,
gaining industry and end-user perspectives on needs and priorities and
defining ways to achieve payment improvements. The Federal Reserve will
host a webcast at 1:00 p.m. EST on January 29, to share views
on the Federal Reserve's vision for the future U.S. payment system and
plans for collaborating with stakeholders to achieve shared goals. In
addition, a subsequent series of FedForum teleseminars on February 4
and 10 will present an overview of the strategies and a
question-and-answer session. Details on accessing the webcast and
registering for the FedForum events are included in an announcement on
New resources for
consumers to fight ID theft
The NCUA has announced
the addition of new information regarding ways to combat identity theft
its consumer web site. The site also contains other resources to help
credit union members understand and prevent identity theft and other
frauds and scams.
NCUA TRID rules
will host a free webinar, "Preparing for the New TILA-RESPA
Integrated Disclosures," on February 11, 2015, starting at 2
p.m. ET. The webinar will provide a high-level overview of the
significant changes to the disclosures and forms required under the
Truth in Lending Act (TILA) and the Real Estate Settlement Procedures
Act (RESPA) that are scheduled to go into effect August 1. Online
registration is available.
Bureau seeks comment
student account scorecard
The CFPB has published in this morning's Federal Register
and request for comment on its draft Safe Student
Account Scorecard that would offer information to colleges
and universities when soliciting agreements from financial institutions
to market safe and affordable financial accounts for their students.
Comments are due by March 9, 2015.
January 26, 2015
Chicago bank closed
The Illinois Department of Finance and Professional Regulation,
Division of Banking has closed Highland
Community Bank, Chicago, Illinois. The FDIC was appointed
receiver and all deposits have been assumed by United
Fidelity Bank, fsb, Evansville, Indiana.
Directory change delayed
Federal Reserve Financial Services has announced
that the scheduled move of the Federal Reserve E-Payments Routing
Directory has been postponed. The original move date was
January 25, 2015. A new effective date for the move is to be
CRA ratings released
The Office of the Comptroller of the Currency has released the ratings
received by thirty national banks and federal savings associations that
were recently examined for compliance with CRA. Two of the institutions
listed were rated outstanding, and twenty-eight received satisfactory
FDIC update on
professional liability lawsuits
The FDIC has updated the data on its Professional
Liability Lawsuits page to indicate that 14 such suits have
been filed thus far in January 2015. As receiver for a failed financial
institution, the FDIC may sue professionals who played a role in the
failure of the institution in order to maximize recoveries. These
individuals can include officers and directors, attorneys, accountants,
appraisers, brokers, or others. Professional liability claims also
include direct claims against insurance carriers such as fidelity bond
carriers and title insurance companies. From January 1, 2009,
through January 22, 2015, the FDIC has authorized suits in
connection with 149 failed institutions against 1195 individuals for
January 23, 2015
Wells and JPMC to
mortgage kickback case
The Consumer Financial Protection Bureau has announced
action taken by the Bureau and the Maryland Attorney General against
Wells Fargo and JPMorgan Chase for an illegal
marketing-services-kickback scheme involving a now-defunct title
company. Action was also taken against a former Wells Fargo employee
and his wife for their involvement in the scheme. Genuine Title would
give the banks' loan officers cash, marketing materials, and consumer
information in exchange for business referrals, according to the CFPB's
filed in federal court. The proposed consent orders, which have also
been filed with the court for approval, would require $24 million in
civil penalties from Wells Fargo, $600,000 from JPMorgan Chase, and
$11.1 million in redress to consumers whose loans were involved. The
loan officer and his wife would pay a $30,000 penalty, and the loan
officer would be barred from the mortgage industry for two years.
A third financial institution whose loan officers also participated in
the Genuine Title kickback scheme self-identified the practice and
fired the officers involved (one of whom was the former Wells Fargo
officer previously mentioned). It also cooperated with the Bureau's
investigation and proactively initiated a remediation plan. As a
result, the Bureau resolved its investigation into that institution
without an enforcement action.
Communities to be
suspended from Flood Program
The Federal Emergency Management Agency has published in this morning's
notices identifying communities where the sale of flood insurance has
been authorized under the National Flood Insurance Program that are
scheduled for suspension from the program due to noncompliance with the
floodplain management requirements of the program.
identifies communities to be suspended on February 4, 2015, in
Delaware, Indiana, Maryland, Michigan, Missouri and Wisconsin
identifies communities to be suspended on February 18, 2015,
in Indiana, Maryland, Michigan and Virginia
identifies communities to be suspended on March 2, 2015, in
Indiana, Iowa and Virginia
The OCC has issued Alert
2015-3 concerning counterfeit cashier's checks using the
routing number of The Bank, N.A., McAlester, Oklahoma. The checks are
being presented for payment nationwide in connection with various
Internet-based employment and purchase scams. Two variations of
counterfeit checks currently in circulation resemble the bank's
authentic checks. Information regarding the counterfeit checks will be
posted on the BOL Alerts
& Counterfeits pages.
The NMLS has announced
it has scheduled system downtime from 9:00 pm. ET Friday, January 23
(this evening) until Saturday afternoon, January 24, to install system
enhancements. Both the NMLS and Consumer Access systems will
be unavailable during the downtime.
FHFA index rises
The Federal Housing Finance Agency (FHFA) has announced
that U.S. house prices rose in November 2014, up 0.8 percent on a
seasonally adjusted basis from the previous month, according to the
monthly House Price Index (HPI). The previously reported 0.6 percent
change in October was revised downward to a 0.4 percent change.
The OCC has issued Bulletin
2015-5 to announce the addition of a new "Government
Securities Act" booklet to the Comptroller's
Handbook. As part of the Securities Compliance series, the
new booklet consolidates certain guidance from the Comptroller's
Handbook for Compliance "Securities Activities" booklet,
issued in September 1991, and the Comptroller's Handbook
booklet "Investment Securities," issued in March 1990.
The NCUA has announced
that 31 federally insured credit unions subject to civil money
penalties for filing third-quarter 2014 Call Reports late have
consented to those penalties. The late filers will pay a total of
$12,820 in penalties.
January 22, 2015
FTC credit report
The Federal Trade Commission has issued a follow-up
report that found most consumers who previously reported an
unresolved error on one of their three major credit reports believe
that at least one piece of disputed information on their report is
still inaccurate. The original
study issued in 2012 found that one in five consumers had an
error that was corrected by a credit reporting agency (after it was
disputed) on at least one of their three credit reports. The follow-up
study announced today focuses on 121 consumers who had at least one
unresolved dispute from the 2012 study and participated in a follow-up
Texas debt collector
The FTC has announced
the filing of a federal
court complaint against Commercial Recovery Systems, Inc.
(CRS), a Texas-based debt collector, and its current and former
principals for illegally threatening consumers with false claims that
unless they pay a debt, they will face legal action or wage
garnishment, or otherwise violated the Federal Trade Commission Act and
the Fair Debt Collection Practices Act.
construction activity rises
HUD and the Census Bureau have released
their report on new residential construction activity in December 2014.
The report shows:
Privately owned housing
authorized by building permits in December were 1.9 percent below the
revised November rate, but 1.0 percent above the December 2013 estimate.
Privately owned housing
in December were at a seasonally adjusted annual rate 4.4 percent above
the revised November estimate and 5.3 percent above the December 2013
December were 7.2 percent above the revised November figure.
Privately owned housing
completions in December 6.3 percent above the revised November estimate
and 19.6 percent above December 2013 numbers.
completions in December were 9.5 percent above the revised November
Lew on the State of
at The Brookings Institution, Treasury Secretary Lew discussed the
series of proposals presented by the President in his State of the
January 21, 2015
The Consumer Financial Protection Bureau has announced
it has finalized two minor modifications to the TILA RESPA Integrated
Disclosure (TRID) Rule that will become effective with applications
received on or after August 1, 2015. The changes address when
consumers will receive updated disclosures after locking in an interest
rate, and how consumers receive information regarding certain
construction loans. The final
rule announced yesterday will require that a revised Loan
Estimate reflecting changes triggered by a rate-lock event be delivered
no later than the third business day following the rate lock
(consistent with the timing requirements for revised Loan Estimates
triggered by other changed circumstances), and will revise the Loan
Estimate form to allow a space for a disclosure that an updated Loan
Estimate may be provided for certain construction loans that are
expected to take over 60 days to settle.
CFPB posts new
tool for consumers
The Bureau has introduced
a new interactive
tool to help consumers determine their likely mortgage
interchange fee challenge
The U.S. Supreme Court has declined to hear a challenge to the "swipe
fee" rules issued by the Federal Reserve Board in its implementation of
the "Durbin Amendement" to the Dodd-Frank Act, reports Reuters.
The SCOTUS refusal to hear the challenge will leave intact the March
2014 ruling by the U.S. Court of Appeals for the District of Columbia
Circuit that the 21 cents per transaction fee cap set by the Federal
Reserve were appropriate.
FRB updates payment
The Federal Reserve Board has posted the 2014 Fourth Quarter Payment
System Risk data. The report charts the peak and average
daylight overdrafts and related fees.
workshop in Miami
The OCC will host a "Building
Blocks for Directors" workshop at the Miami Hyatt Regency,
February 23–25, 2015, for directors of national community banks and
federal savings associations. Attendance is limited to the first 35 registrants.
SAR stats update
FinCEN has issued the Fourth Quarter 2014 update of SAR
Stats (formerly "By the Numbers"). The report is a
compilation of numerical data gathered from the FinCEN Suspicious
Activity Reports filed by financial institutions.
NCUA posts legal
on Risk-Based Capital proposal
The NCUA has posted
from an outside law firm regarding the agency's revised
proposed risk-based capital rule . Comments on the revised
proposed rule must be received within 90 days of its publication in the
January 20, 2015
OCC January 2015
The OCC has released the list
of new enforcement actions taken against national banks, federal
savings associations, and individuals currently and formerly affiliated
with national banks and federal savings associations. Included were
reported Consent Orders for Civil Money Penalties totaling
$950 million against three national banks for unsafe or unsound
practices related to their foreign exchange operations.
FinCEN letter on
has been released by FinCEN responding to a request for guidance from
the American Gaming Association concerning the application of
anti-money laundering (AML) programs for casinos. The letter stated "it
has also come to our attention that casinos may be under the impression
that unless specifically directed to do so, a casino never has to ask a
patron whether he or she is betting on his or her own behalf or on
behalf of another party. We are communicating directly with your
organization to correct any such misperception and to remind your
industry about the importance of applying a risk-based approach with
respect to this issue as well as the need to implement reasonably
designed AML programs to address among other risks, the risks
associated with third-party betting."
The FTC has announced
that AMG Services, Inc., and MNE Services, Inc., two payday lending
companies, have settled charges that they violated the law by charging
consumers undisclosed and inflated fees. Under the proposed
settlement, they will pay $21 million, the largest FTC
recovery in a payday lending case, and will waive another $285 million
in charges that were assessed but not collected. The settlement also
contains broad prohibitions barring the defendants from misrepresenting
the terms of any loan product, including the loan's payment schedule,
the total amount the consumer will owe, the interest rate, annual
percentage rates or finance charges, and any other material facts. The
settlement order also prohibits the defendants from violating the Truth
in Lending and Electronic Fund Transfer Acts.
OFAC adds Kingpin
Treasury has announced
of two Indian nationals and one company based in Pakistan as SDNTKs and
the additions of their names to the SDN List. The individuals and
company were designated due to their ties to D Company, a South Asian
HUD has announced
$3.2 million in new Choice Neighborhoods Planning Grant awards to seven
communities in Michigan, Indiana, Kentucky, Alabama, and Missouri. The
awards will help grantees craft comprehensive, locally driven plans to
revitalize and transform distressed neighborhoods.
TIC November data
Treasury has released the Treasury International Capital (TIC) data for
2014. The sum total in November of all net foreign
acquisitions of long-term securities, short-term U.S. securities, and
banking flows was a monthly net TIC outflow of $6.3 billion. Of this,
net foreign private outflows were $2.9 billion, and net foreign
official outflows were $3.4 billion.
section of Handbook
The OCC has issued Bulletin
2015-4 announcing the revision of the Litigation and Other
Legal Matters booklet of the Comptroller's Handbook.
The revised booklet provides guidance to examiners assessing a bank's
litigation exposures, associated risks, and risk management practices.
The revision replaces information issued on February 2000.
Advisory Board and Councils
The Bureau has announced
it is accepting applications for its Consumer Advisory Board (10
seats), Community Bank Advisory Council (7 seats) and Credit Union
Advisory Council (8 seats). The seats become vacant in the fall of
January 16, 2015
OFAC amends Cuban
Treasury's Office of Foreign Assets Control (OFAC) has published in
today's Federal Register a final rule [80 FR 2291]
amending the Cuban Assets Control Regulations to implement policy
changes announced by the President on December 17, 2014, to further
engage and empower the Cuban people. The amendments facilitate travel
to Cuba for authorized purposes, facilitate the provision by travel
agents and airlines of authorized travel services and the forwarding by
certain entities of authorized remittances, raise the limit on certain
categories of remittances to Cuba, allow U.S. financial institutions to
open correspondent accounts at Cuban financial institutions to
facilitate the processing of authorized transactions, authorize certain
transactions with Cuban nationals located outside of Cuba, and allow a
number of other activities related to, among other areas,
telecommunications, financial services, trade, and shipping. The
amendments also implement certain technical and conforming changes. The
amendments are effective upon today's publication. Treasury also
published a fact
sheet on the amendments.
The OCC has issued Alert 2015-2 regarding counterfeit cashier's checks
using the routing number of First National Bank, Fort Pierre, South
Dakota. Counterfeit checks presented to date have contained a remitter
name of Taylor Andrew and have been made payable in the amounts of
$1,985, $2,485, $2,890, or $2,985. Information regarding the
counterfeit cashier's checks has been posted on the BOL Alerts
& Counterfeits pages.
Resolution plans for
under $100B released
A joint press
release from the Federal Reserve Board and the FDIC has
announced the release of the public portions of resolution plans
(commonly called "living wills") for firms with generally less than
$100 billion in qualifying nonbank assets, as required by the
Dodd-Frank Act. The plans can be reviewed on the websites of the Board
and the FDIC.
FRB Services has posted the January 2015 issue of FedFlash.
Featured articles include:
Reminder to File a
Board Resolution and Official Authorization List
New Check Adjustments
Moving Effective January 25, 2015
Continuation of the
Beautiful Quarters program
New Operating Hours for
National Settlement Service
The FDIC has issued FIL-4-2-15
to announce the launch of a Failing
Bank Acquisitions webpage to provide information on how the
regulator markets failing institutions.
NCUA Board action
An NCUA Board
Action Bulletin has been issued to announce the results of
the Board's January 15, 2015, meeting. The NCUA Board also announced
its approval of the payment of up to $50,000 for costs associated with
a data breach at Palm Springs Federal Credit Union of Palm Springs,
January 15, 2015
CFPB proposes Safe
The Consumer Financial Protection Bureau has announced
it is seeking input on a "Safe Student Account Scorecard." The
scorecard would help colleges access upfront information about fees,
features, and sales tactics before agreeing to a sponsorship with a
financial institution to offer checking and prepaid accounts. A Request
for Information (RFI) seeking comment on the proposed
scorecard from the public, including student and parent consumers,
institutions of higher learning and financial institutions, has been
issued. The scorecard specifically would ask financial institutions to
a clear description of
fees and features;
full disclosure about
financial institution's marketing practices;
information on how much
financial institution earns from the accounts; and
an annual summary of
CFPB Director Cordray issued prepared
remarks on the Student Accounts Press Call announcing the
SDN List updated
Treasury has announced the designation
of a Palestinian individual as an SDGT and the corresponding update of
FHFA 2015 Scorecard
Scorecard has been released by Federal Housing Finance Agency
(FHFA). Specific priorities for Fannie Mae, Freddie Mac and their joint
venture, Common Securitization Solutions, LLC, are listed. They
Maintenance, in a safe
sound manner, of credit availability and foreclosure prevention
activities for new and refinanced mortgages to foster liquid,
efficient, competitive and resilient national housing finance markets;
Reduction of taxpayer
through increasing the role of private capital in the mortgage market;
Building of a new
single-family securitization infrastructure for use by the Enterprises
and adaptable for use by other participants in the secondary market in
More EGRPRA outreach
press release from the OCC, FDIC and FRB has announced an
outreach meeting will be held on February 4, 2015, at the
Federal Reserve Bank of Dallas as part of the agencies' regulatory
review under the Economic Growth and Regulatory Paperwork Reduction Act
of 1996 (EGRPRA). Details on the Dallas meeting, including registration
information, the webcast link, and the agenda, are available on the EGRPRA
website. Additional meetings are currently scheduled in
Boston on May 4, Chicago on October 19, and
Washington on December 2. The agencies also plan to hold an
outreach meeting focused on rural banks. The meetings may be viewed
OCC 2015 Directors
The Office of the Comptroller of the Currency has announced
its 2015 schedule of workshops for directors of national community
banks and federal savings associations.
2015-2 (Retail Nondeposit Investment Products) and Bulletin
2015-3 (Conflicts of Interest) have been issued by the OCC to
announce revisions to the Comptroller's Handbook.
FTC to host Tax ID
of events will be hosted
by the FTC during the week of January 26–30 to raise
consumer awareness about the threat posed by tax identity theft.
FDIC Board meeting
of the January 21, 2015, open meeting of the FDIC Board of
Directors has been posted.
Matz and Cordray to
town hall webinar
The NCUA has announced
that Chairman Matz will host a ninety-minute free town hall webinar
meeting with CFPB Director Cordray on February 10, at 3 pm.
ET. This will be the fourth annual joint webinar to discuss NCUA and
CFPB regulatory issues. Registration
for the event is open.
NCUA Board meeting
of the December 11, 2014, open meeting of the NCUA Board is
now available for viewing online.
Beige Book published
The Federal Reserve Board has published the January
2015 issue of the Beige Book. The report
is published eight times per year and contains information on current
economic conditions in the twelve districts through reports from bank
and branch directors and interviews with key business contacts,
economists, market experts, and other sources.
January 14, 2015
In a unanimous opinion released yesterday, the Supreme Court settled
the question of whether a consumer must file a lawsuit to exercise an
extended right to rescind a mortgage transaction, or simply notify the
lender in writing. The Court held that 15 U.S.C. 1635 (the applicable
portion of the Truth in Lending Act) requires only that the consumer
provide a written notice to the lender. Previously, rulings in the
First, Sixth, Eighth, Ninth and Tenth Circuits had held that the
consumer had to file suit. The Syllabus of yesterday's court decision
in Jesinoski et ux. v. Countrywide Home Loans, Inc., et al.
has been paraphrased on BOL's CourtWatch
Pakistani added to
Treasury's Office of Foreign Assets Control (OFAC) has announced
it has designated a Pakistani as an SDGT and added his name to the SDN
The Federal Reserve Board has released the minutes
of its November 24 and December 15, 2014, discount
OCC paper on
The OCC has published
a paper, "An
Opportunity for Community Banks: Working Together Collaboratively."
The paper describes how community banks can pool resources to obtain
cost efficiencies and leverage specialized expertise. It also explores
the benefits of collaboration, outlines how community banks can
structure collaborative arrangements, and emphasizes the need for
effective oversight of collaborative arrangements.
Webinar on proposed
risk-based capital rule
The NCUA will host a webinar
on its revised proposed risk-based capital rule on January 21,
beginning at 2 p.m. ET.
Bureau: Many don't
The CFPB has posted an article
and issued a news
release about what most mortgage lenders would call the
obvious: almost half of recent mortgage borrowers don't shop around for
home mortgages. The releases report on a survey of individuals who
obtained mortgages in 2013, which reveals that:
Almost half of borrowers
seriously consider only one lender or broker before making an
77 percent of borrowers
with a single lender or broker, rather than making multiple
applications to seek the best deal
70 percent of borrowers
lenders and brokers as a primary source of mortgage information, and 30
percent sought the information from real estate agents
Borrowers who were
their knowledge of available interest rates were twice as likely to
shop for mortgages as consumers who knew little about rates
The Bureau also promoted its new Owning a
Home interactive resources designed to help borrowers
approach the mortgage shopping process with more information.
January 12, 2015
Impact of debts on
The CFPB has posted an article
on the negative impact personal debt may have on military duty status,
potential promotions and careers. The article includes tips and
information for military personal regarding management of debts,
expenses, income and other personal finance matters.
income data released
The Federal Reserve Board has announced
that preliminary unaudited results indicate the Reserve Banks provided
payments of approximately $98.7 billion of their estimated 2014 net
income to the U.S. Treasury. The residual earnings of each Federal
Reserve Bank are distributed to the Treasury, after providing for the
costs of operations, payment of dividends, and the amount necessary to
equate surplus with capital paid-in.
January 9, 2015
FHA reduces annual
HUD Secretary Castro has announced
that the FHA will reduce the annual premiums new borrowers will pay by
one-half of a percent. The reduction is projected to save FHA
homeowners an average of $900 annually. The new annual premium prices
are expected to take effect towards the end of the month. The FHA will
publish a mortgagee letter detailing its new pricing structure.
An open meeting with the NMLS Ombudsman will be held on Monday,
February 16, 2015, from 2:00–5:00 pm. PST, in conjunction with
the 2015 NMLS Annual Conference & Training in San Diego,
California. Conference registration is not required to attend the
meeting. The meeting will be in-person only. Additional information on
Annual Conference has been made available.
The Federal Reserve posted the November 2014 G.19
Consumer Credit Report. Consumer credit increased at a
seasonally adjusted annual rate of 5 percent. Revolving credit
decreased at an annual rate of 1¼ percent, while nonrevolving credit
increased at an annual rate of 7½ percent.
The January 2015 issue of FedFocus
has been posted by Federal Reserve Bank Services. The feature story
reports how a bank enhanced its business continuity plan by ordering a
backup VPN device. There are also articles on:
How to stay informed
FedCash Services disruptions
The number of Federal
notes ordered for 2015
The 2015 America the
The new registration
for FEDucation opportunities
2015-1 has announced that the second in a series of outreach
meetings on the interagency effort to reduce regulatory burden as
required by the Economic Growth and Regulatory Paperwork Reduction Act
of 1996 (EGRPRA) will be held in Dallas on February 4, 2015.
Individuals wishing to attend the outreach meeting in Dallas must register,
and participation is limited. Online registrations are accepted through
January 28, 2015, or until all seats are filled.
NCUA Board to meet
for the January 15, 2015, meeting of the NCUA Board has been
January 8, 2015
Federal Open Market
of the December 16-17, 2014, meeting of the Federal Open
Market Committee have been released by the Federal Reserve Board.
New NCUA cyber fraud
A new two-part video on how to recognize, avoid and report cyber fraud
has been released by the National Credit Union Administration. The
video is available on the NCUA YouTube
Bureau to launch
The CFPB published a Notice and Request for Comment [80 FR 1027]
in today's Federal Register in which it reports
that the Bureau will, beginning in the winter of 2015, launch a
multi-site financial education demonstration project to provide
one-on-one and group financial counseling/coaching services to
individuals with disabilities transitioning into the workplace or
January 7, 2015
counterfeit cashier's checks
The OCC has issued its Alert
2015-1 about counterfeit cashier's checks using the routing
number for Simplicity Bank, Covina, California. The counterfeit checks
do not resemble Simplicity's authentic checks. Information regarding
the counterfeit checks has been posted on the BOL Alerts
& Counterfeits page.
FDIC Call Report
The FDIC has issued FIL-3-2015
reminding its supervised institutions of the December 31,
2014, Consolidated Reports of Condition and Income (Call Report). The
This Call Report does not
require institutions to report any new or revised data items.
Banks should review FIL-1-2015
and its accompanying Supplemental Instructions for further information
on the fourth quarter 2014 Call Report.
Instructions include guidance on the applicability for Call Report
purposes of a new accounting standard that allows institutions to elect
whether or not to apply pushdown accounting in certain business
This guidance also
that an institution's primary federal regulator reserves the right to
require, or prohibit, the institution's use of pushdown accounting
based on an evaluation of whether the election appears not to be
supported by the facts and circumstances of the business combination.
Dean named FDIC
The FDIC has announced
that it has appointed Michael J. Dean as Regional
Director for the agency's Atlanta Region. Dean has been the Acting
Regional Director for that office since April 2014. He oversees the
FDIC's bank supervisory and compliance activities in Alabama, Florida,
Georgia, North Carolina, South Carolina, Virginia and West Virginia.
The Atlanta Region supervises 819 institutions with combined assets of
over $454 billion.
January 6, 2015
New SDN List format
Treasury has announced
OFAC's release of a new
format for the SDN List. The format was jointly developed
with the United Nations and the Wolfsberg
Group of International Banks to create a universal sanctions
list format that can be efficiently used by governments worldwide and
enhances sanctions compliance. The enhancements include:
new metadata, including
specific labels for name parts that go beyond the standard "Last name,
First name" style of current sanctions lists
language scripts beyond
standard Latin script used in many sanctions lists
a data dictionary of all
look-up values in the header of the file
a flexible "feature
functionality that augments the normal identification look-up values
that are currently available in the SDN List formats
on using the new format were also released. There are no current plans
to replace any of the current OFAC file formats with the new, enhanced
The FDIC has issued FIL-2-2015
in the form of "Frequently Asked Questions" or "FAQs" to promote
consistency by insured depository institutions in identifying,
accepting, and reporting brokered deposits.
CRA ratings released
The FDIC has issued a list
of state nonmember banks recently evaluated for compliance
with the Community Reinvestment Act (CRA). Of the 91 institutions
listed, seven were rated outstanding and 84 received satisfactory
January 5, 2015
Call Report FIL FIL-1-2015
has been issued by the FDIC regarding the Consolidated Reports of
Condition and Income for the Fourth Quarter, 2014. With the exception
of reports by institutions with more than one foreign office, the Call
Reports must be filed and pass validation checks by
January 30, 2015.
Order (E.O.) has been signed by President Obama authorizing
the imposition of sanctions against the Government of North Korea and
the Workers' Party of Korea in response to the Government of the
Democratic People's Republic of Korea's numerous provocations,
particularly the recent cyber-attack targeting Sony Pictures
Entertainment and the threats against movie theaters and moviegoers.
Pursuant to the authorities of the E.O., Treasury has designated
three entities and 10 individuals for being agencies or officials of
the North Korean government. Their names have been added
to the SDN List with the DPRK2 identifier.
NCUA loans and
The National Credit Union Administration has published notices in this
morning's Federal Register announcing access to two
Office of Small Credit Union Initiatives (OSCUI) programs for small
A Notice of Funding
260] inviting eligible credit unions to submit applications
for participation in the OSCUI Loan Program
A Notice of Funding
263] inviting eligible credit unions to submit applications
for participation in the OSCUI Grant Program
Participation in these programs is subject to funding availability.
2014 Annual and G.5
December 2014 exchange rates data have been posted by the Federal
January 2, 2015
The NCUA has issued six
orders prohibiting designated individuals from participating
in the affairs of any federally insured financial institution.
Quarter 2014 issue of the Federal Reserve's Consumer
Compliance Outlook newsletter has been released, with
featured articles on "Transitioning from an Intermediate Small Bank to
a Large Bank Under the Community Reinvestment Act" and "Managing
Compliance Risk Through Consumer Compliance Risk Assessments."
The Treasury Department's Federal Insurance Office (FIO) has issued its
on the global reinsurance market and its role in supporting
insurance in the U.S. The report, which is required by Title V of the
Dodd-Frank Act, summarizes the history of reinsurance as a product and
an industry, and outlines its various functions.
Window lending data
The Fourth Quarter 2012 Discount
Window lending data have been released by the Federal Reserve
2015 currency and
The Federal Reserve Board's Freedom of Information Office has released
Bank budgets for 2015.
2015 HMDA and CRA
The FFIEC has announced
the availability of the 2015 versions of HMDA and CRA data entry
HAPPY NEW YEAR!
Today we begin anew our collection of the Top Stories affecting banks
and banking, with the start of a new year. For our archive of stories
back to the year 2000, click the drop-down list near the top or bottom
of this page.
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