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Banker's Toolbox, Inc., leaders in compliance solutions for financial institutions, announced the acquisition of Georgia-based MainStreet Technologies (MST). MST is an industry leader in the loan risk management space. This acquisition adds to a strong and growing portfolio of compliance-related solutions and will continue to enhance the value Banker's Toolbox brings to both their customers and the industry. (Read full press release here.)

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FEMA suspending communities from NFIP

FEMA published a final rule in today's Federal Register identifying communities in Alabama, Arkansas and Texas that are scheduled to be suspended on March 21, 2019, from the National Flood Insurance Program for non-compliance with the floodplain management requirements of the program:


FinCEN replaces Part 561 List with CAPTA List

OFAC has posted an announcement that it is replacing its List of Foreign Financial Institutions Subject to Part 561 with the List of Foreign Financial Institutions Subject to Correspondent Account or Payable-Through Account Sanctions (the “CAPTA List”).

The CAPTA List contains identifying information of foreign financial institutions for which the opening or maintaining of a correspondent account or a payable-through account in the United States is prohibited or is subject to one or more strict conditions. The specific strict conditions or prohibitions to which the foreign financial institutions are subject include the Ukraine Freedom Support Act of 2014, as amended by the Countering America's Adversaries Through Sanctions Act (CAATSA), the North Korea Sanctions Regulations, 31 C.F.R. part 510, the Iranian Financial Sanctions Regulations, 31 C.F.R. Part 561, which were identified on OFAC's now defunct Part 561 List, and the Hizballah International Financing Prevention Act of 2015, which would be identified on the Hizballah Financial Sanctions Regulations List (the “HFSR List”).

The CAPTA List is not part of the Specially Designated Nationals (SDN) List. Information that appears on the CAPTA list will be included in the data formats associated with the Consolidated Sanctions List.


Comptroller’s Handbook updated

OCC Bulletin 2019-13, issued Friday, announced the update of the “Recovery Planning” booklet of the Comptroller’s Handbook. The booklet explains effective recovery planning under 12 CFR 30, appendix E, “OCC Guidelines Establishing Standards for Recovery Planning by Certain Large Insured National Banks, Insured Federal Savings Associations, and Insured Federal Branches.” This updated booklet replaces a similarly titled booklet issued in April 2018.


OCC announces enforcement actions

The OCC has released a list of new enforcement actions taken against OCC-supervised institutions and individuals currently and formerly affiliated with such institutions. The actions are dated in February and March. In addition to a previously-announced action against the New York branch and additional offices of MUFG Bank, Ltd in Los Angeles and Chicago, there was an order assessing a civil money penalty of $10,000 paid by the former Director and Interim Chief Executive Office and Vice Chairman of United Americas Bank, N.A., Atlanta, Georgia.


FDIC rescinds disclosure rule

The FDIC has published [84 FR 9698, 3/18/2019] a final rule rescinding and removing its regulations (12 CFR part 350) entitled Disclosure of Financial and Other Information By FDIC-Insured State Nonmember Banks. Upon the removal of the regulations, all insured state nonmember banks and insured state-licensed branches of foreign banks will no longer be subject to the annual disclosure statement requirement set out in the existing regulations. The financial and other information that has been subject to disclosure by individual banks under the regulations is publicly available through the FDIC's website. The rule will be effective April 17, 2019.


OFAC sanctions Russia over Ukraine aggression

On Friday, OFAC designated six Russian individuals and eight entities in response to Russia’s continued and ongoing aggression in Ukraine. This action targets individuals and entities playing a role in Russia’s unjustified attacks on Ukrainian naval vessels in the Kerch Strait, the purported annexation of Crimea, and backing of illegitimate separatist government elections in eastern Ukraine. These actions complement sanctions also taken by the European Union and Canada. For identification of the individuals and entities designated on Friday, see our OFAC Update.


Israeli bank to pay $195M for aiding tax evasion

The Department of Justice announced yesterday that Mizrahi-Tefahot Bank Ltd., and its subsidiaries, United Mizrahi Bank (Switzerland) Ltd. and Mizrahi Tefahot Trust Company Ltd., entered into a deferred prosecution agreement with the Department of Justice filed in the U.S. District Court for the Central District of California. As part of the agreement, Mizrahi-Tefahot will pay $195 million to the United States.

In the deferred prosecution agreement and related court documents, Mizrahi-Tefahot admitted that from 2002 until 2012 the actions of its bankers, relationship managers, and other employees defrauded the United States and specifically the Internal Revenue Service with respect to taxes by conspiring with U.S. taxpayer-customers and others. Mizrahi-Tefahot employees’ acts of opening and maintaining bank accounts in Israel and elsewhere around the world and violating Mizrahi-Tefahot’s Qualified Intermediary Agreement with the IRS enabled U.S. taxpayers to hide income and assets from the IRS.

The $195 million payment consists of: 1) restitution in the amount of $53 million, representing the approximate unpaid pecuniary loss to the United States as a result of the criminal conduct; 2) disgorgement in the amount of $24 million, representing the approximate gross fees paid to the bank by U.S. taxpayers with undeclared accounts at the bank from 2002 through 2012; and 3) a fine of $118 million.


Brainard on CRA improvement

In remarks at the 2019 Just Economy Conference of the National Community Reinvestment Coalition, Federal Reserve Board Governer Lael Brainard discussed "how we can preserve what is working well with the Community Reinvestment Act (CRA) and make it better," and regulators' efforts for improving their regulatory approach to the CRA. One of the potential improvements Brainard discussed is a change to how institutions define their CRA assessment areas in light of increased digital delivery of bank services.


18th edition of CFPB Supervisory Highlights

The Bureau has released its 18th edition of Supervisory Highlights, which covers its supervision activities generally completed between June 2018 and November 2018, and includes examination findings in the areas of automobile loan servicing, deposits, mortgage servicing, and remittances.


FSOC will accept comments on determinations guidance

The Federal Stability Oversight Council has published a rule [84 FR 8958, amending 12 CFR part 1310] stating that the Council shall not amend or rescind its interpretive guidance on nonbank financial company determinations without providing the public with notice and an opportunity to comment consistent with the Administrative Procedure Act. This rule is effective April 12, 2019.


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