Top Story Compliance Related

The CFPB has released its annual report to Congress summarizing the Bureau's activities to administer the Fair Debt Collection Practices Act (FDCPA) in 2023 as the primary federal regulator of the consumer debt collection industry. The report also includes activities related to the debt collection industry that were conducted by the Federal Trade Commission in 2023 and highlights consumer protection issues in medical and rental debt collection.

The Treasury Department yesterday announced that OFAC has designated 10 individuals and two entities as part of a coordinated U.S. government response to Moscow’s malign influence efforts targeting the 2024 U.S. presidential election. Beginning in early 2024, executives at RT—Russia’s state-funded news media outlet—began a nefarious effort to covertly recruit unwitting American influencers in support of their malign influence campaign. RT used a front company to disguise its own involvement or the involvement of the Russian government in content meant to influence U.S. audiences.

Yesterday’s designations complement law enforcement actions taken by the Department of Justice and the Department of State’s designation of the Rossiya Segodnya media group and five of its subsidiaries, RIA Novosti, RT, TV-Novosti, Ruptly, and Sputnik, as Foreign Missions, steps to impose visa restrictions, and release of a Rewards for Justice (RFJ) reward offer of up to $10 million relating to information pertaining to foreign interference in a U.S. election.

For the names and identification information of the designated parties, and information on related OFAC actions, see this September 4, 2024, BankersOnline OFAC Update.

The Federal Reserve Board has announced it has issued enforcement actions against two banks.

• First Interstate Bank, Billings, Montana, was assessed a $70,000 civil money penalty for a pattern or practice of violations of Regulation H, 12 C.F.R. § 208.25, which implements the requirements of the National Flood Insurance Act.
• United Texas Bank, Dallas, Texas, received a consent cease and desist order issued jointly by the Federal Reserve Board and the Texas Department of Banking after a May 2023 examination identified deficiencies in its BSA/AML compliance program.
  

The Federal Reserve Board's archive of CRA evaluation reports include ten that were made public in August 2024. Eight of the ten evaluated banks received Satisfactory ratings. One, in Greenwich, Connecticut, received a Needs to Improve. And one bank, Central Savings Bank, Sault Sainte Marie, Michigan, received an Outstanding rating on its evaluation.

The FDIC has released its September 2024 list of FDIC-supervised financial institutions whose CRA evaluations were recently made public. Of the 54 institutions listed, two banks — one based in Utah, the other in Pennsylvania — received "Needs to Improve" ratings. Satisfactory ratings were issued to the other 52 institutions.

The Securities and Exchange Commission yesterday announced charges against six nationally recognized statistical rating organizations, or NRSROs, for significant failures by the firms and their personnel to maintain and preserve electronic communications. The firms admitted the facts set forth in their respective SEC orders; acknowledged that their conduct violated recordkeeping provisions of the federal securities laws; agreed to pay combined civil penalties of more than $49 million; and have begun implementing improvements to their compliance policies and procedures to address these violations.

• Moody’s Investors Service, Inc. agreed to pay a $20 million civil penalty;
• S&P Global Ratings agreed to pay a $20 million civil penalty;
• Fitch Ratings, Inc. agreed to pay an $8 million civil penalty;
• HR Ratings de México, S.A. de C.V. agreed to pay a $250,000 civil penalty;
• A.M. Best Rating Services, Inc. agreed to pay a $1 million civil penalty; and
• Demotech, Inc. agreed to pay a $100,000 civil penalty.

The OCC has released CRA evaluations for 17 national banks and federal savings associations whose evaluations became public in August. Ten of the evaluations are rated Satisfactory. We congratulate seven institutions for receiving evaluations with an Outstanding rating:

• Bank of Bridger, National Association, Bridger, MT
• (The) Citizens National Bank of Meridian, Meridian, MS
• Farmers National Bank, Phillipsburg, KS
• Home National Bank, Racine, OH
• Malaga Bank, F.S.B., Palos Verdes Peninsula, CA
• (The) Security National Bank of Sioux City, Iowa, Sioux City, IA
• Universal Bank, West Covina, CA

The FDIC has released a list of enforcement orders issued in July 2024.

• A Consent Order against The State Exchange Bank, Lamont, Oklahoma
• A Consent Order against Chesterfield State Bank, Chesterfield, Illinois
• Prohibition orders against:
  • Raqeel Rashida Alsalam, formerly affiliated with First-Citizens Bank & Trust Company, Raleigh, North Carolina
  • Brent D. Torgerson, formerly affiliated with The Union Bank, Beulah, North Dakota
  • Samuel Ortiz-Perez, formerly affiliated with FirstBank Puerto Rico, Santurce, Puerto Rico
  • Leann Athas, formerly affiliated with Bank of Montana, Missoula, Montana

The OCC has released its schedule of Community Reinvestment Act (CRA) evaluations to be conducted in the fourth quarter of 2024 and the first quarter of 2025.

The FDIC has also issued its Q4 2024 and Q1 2025 CRA exam schedules.

The Federal Reserve Board on Wednesday announced final individual capital requirements for all large banks, effective on October 1.

Large bank capital requirements are informed by the Board's stress test results, which provide a risk-sensitive and forward-looking assessment of capital needs. The table in the Large Bank Capital Requirements document shows each bank's common equity tier 1 capital requirement, which is made up of several components, including:

• The minimum capital requirement, which is the same for each bank and is 4.5 percent;
• The stress capital buffer requirement, which is based in part on the stress test results and is at least 2.5 percent; and
• If applicable, a capital surcharge for the largest and most complex banks, which is updated in the first quarter of each year to account for the overall systemic risk of each of these banks.

If a bank's capital dips below its total requirement, the bank is subject to automatic restrictions on both capital distributions and discretionary bonus payments.

The Board also announced that it had modified the stress capital buffer requirement for Goldman Sachs, after the firm's request for reconsideration.