If you've been involved in fair lending for any number of years you remember the mystery shoppers looking for different treatment of similarly qualified applicants. Now the mystery shoppers are back, but they're looking for UDAAP. Time to be sure everyone is thinking outside the box. I used to teach fair lending on loans, fair banking on the Ops side. Seems like a good practice even today.

The use of “mystery shoppers” and focus groups to test the compliance of bank employees has broadened beyond the traditional topic of lending discrimination to now include uncovering and avoiding violations of unfair, deceptive and abusive practice, an industry consultant said.

Paul Lubin, senior director at Treliant Risk Partners, said such testing can raise bank revenue as well as help to insure employees are adhering to rules.“Testing helps the product people sell products that are appropriate, which can increase customer loyalty and result in referrals. At the same time regulators are very interested in knowing institutions have programs in place that can detect any instances of abusive and deceptive sales practices,” said Lubin who has been active in compliance testing at financial companies for over 30 years.

http://blogs.reuters.com/financial-regul...es-expert-says/