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Latest Compliance - Bankruptcy Topics

Recurring Charge on Closed Credit Card-Bankruptcy

06/21/2020

A recurring charge was processed on a credit card that was closed due to bankruptcy. It had originally been denied and then was allowed a few days later. Is this allowed per regulations?

Collection Communication for Demand Deposit Accts.

04/22/2018

Collection communication for demand deposit accounts (i.e., overdraft notices, NSF notices, request for payment, etc) - are we allowed to send ​such notices ​if we are aware of an active bankruptcy case? What if we are not made aware of the bankruptcy case?

Credit Reporting on Bankrupt Accounts

12/20/2015

We are dealing with the problem of credit reporting on bankrupt accounts. Our reporting is done at the loan level therefore non bankrupt co-borrowers are affected. Can we just suppress reporting?

Adverse Action Notices for Loan Declines

01/02/2012

If we have two applicants and one has excellent credit and one has bad credit and we decline the loan, is it required that we send out an Adverse Action Notice to the applicant with the good credit and indicate that the co-applicant does not meet the minimum standards?

Bank Responsibility: Refunding Provisional Credit

11/07/2011

REG E Question: A customer authorized a purchase for a product. The product has not been received and the customer contacted the company and found out that the company has filed for bankruptcy. Our customer then filed an unauthorized affidavit for his refund. Is the bank responsible for refunding the provisional credit when the customer did say in his response that he did authorized the purchase?

1099-C Cancellation of Debt - Personal Bankruptcy

11/16/2009

In the case of a personal bankruptcy, I noticed that the IRS rules say we are not required to file. Can we file anyway, and can we file at any time during the year, or should we wait until we prepare the 1098 statements?

Print Ad - Mortgage Lending Compliance

09/21/2009

One of our mortgage lenders would like to place an ad in the classified portion of the local newspaper. The ad reads: Have you filed bankruptcy or had your home foreclosed on in the past two years? Call [name] to get your credit checked. You may be eligible to purchase a home. Numerous programs available to be a homeowner again. Then she lists her name and cell phone. The bank is not mentioned. Does it need to be? Would this ad be considered compliant? What would make it compliant? Is this a bad idea?

Report Cancellation of Debt - Continue Collecting?

08/17/2009

If we report on a 1099-C cancellation of debt to the IRS, can we continue to pursue the debt or only accept voluntary payments? If we report, are we limiting ourselves on the possibility of recovery? I'm excluding bankruptcy issues. Can you provide the citation or source document information for further research?

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TILA and RESPA: Pending Rules for Telling Customers What They Owe

Periodic statements are routine for open-end creditors. Both credit card customers and HELOC borrowers have been getting periodic statements for longer than most people can remember.

Escrow Account Rules

The CFPB used the final rulemaking on mortgage servicing as an opportunity to address and update several issues in the escrow rules of Regulation X.

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Most Popular Compliance Content

Duplicate ATM Withdrawals

05/09/2021

Recently my bank began to duplicate ATM withdrawals for some customers. For one customer alone it could amount to several thousand dollars. This went on for months before the customer and the bank discovered the problem. At that time the customer sent an email to our helpline asking for assistance and claiming that she had not made the duplicate withdrawals herself. I’m inclined to let her go through the process of trying to prove that she did not make these withdrawals herself. She was in Mexico and I believe it will be very hard to get a Mexican bank to help her. Unfortunately our customer assistance sent her a reply stating that the bank had a known issue creating duplicates for ATM withdrawals. Otherwise how can she prove it? Are we in any danger if she does take legal action? Since she is in Mexico I had the customer service write her back and tell her she needs to go to her local bank and take care of it herself. That has been our standard reply since for similar claims. If she takes legal action what are the odds that we would lose and have to pay her back all that money? Can we simply delete the email we sent to her saying we had a known issue with duplicates on ATM withdrawals? Then she’d have no proof whatsoever. Please advise.

Duplicate ATM Withdrawals

05/09/2021

Recently my bank began to duplicate ATM withdrawals for some customers. For one customer alone it could amount to several thousand dollars. This went on for months before the customer and the bank discovered the problem. At that time the customer sent an email to our helpline asking for assistance and claiming that she had not made the duplicate withdrawals herself. I’m inclined to let her go through the process of trying to prove that she did not make these withdrawals herself. She was in Mexico and I believe it will be very hard to get a Mexican bank to help her. Unfortunately our customer assistance sent her a reply stating that the bank had a known issue creating duplicates for ATM withdrawals. Otherwise how can she prove it? Are we in any danger if she does take legal action? Since she is in Mexico I had the customer service write her back and tell her she needs to go to her local bank and take care of it herself. That has been our standard reply since for similar claims. If she takes legal action what are the odds that we would lose and have to pay her back all that money? Can we simply delete the email we sent to her saying we had a known issue with duplicates on ATM withdrawals? Then she’d have no proof whatsoever. Please advise.

USA Patriot Act- CIP Notices

05/09/2021

We provide services non-account holders, as well as account holders. Our platforms require the creation of customer "folders" for all teller transactions. This means we capture CIP elements to create non-account holder folders to process those transactions. As the USA PATRIOT Act requires the capturing of CIP elements for account opening only (as far as I understand), are we also required to post customer CIP notices at the teller stations as well for non-account holders? Logic would dictate that the answer is yes, because the same CIP information is being collected for both groups, and we practice our KYC and AML principles for both. (Non-account holders or "consumers" can launder money or finance terrorism just as easily, or more easily, as an account holder.) However, the PATRIOT Act only requires the notices for account opening activities/locations. Technicality, I'm sure. But what is the right thing to do?

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