So to sum this up, I too would be concerned with 1) masking your past due loans (which is the safety and soundness issue Randy is referencing) and 2) fair lending as there seems to be a lot of discretion when this is done. To me, UDAAP isn't as problematic as these two issues, but could be an issue if you are doing something different than what you disclose.
Unfortunately, there isn't a clear citation that says you can't do this, but there have been plenty of enforcement actions over the years for these types of problems. The bottom line is that this isn't a good practice.
Adam Witmer, CRCM
All statements are my opinion, not those of my employer, and should not be taken as legal advice.www.compliancecohort.com