Top Story Compliance Related

OFAC has designated as specially designated global terrorists nine individuals and entities procuring export-controlled, U.S.-origin goods for sanctioned Iranian airlines. They were designated pursuant to Executive Order 13224, which targets terrorists and those providing support to terrorists or acts of terrorism. OFAC also identified 31 aircraft in which entities previously designated under E.O. 13224 have an interest. See our OFAC Page for identification information.

HUD has announced it is charging Syracuse, New York, property owners Nolo Contendere LLC and Nolo Contendere LLC Trust and their agents with housing discrimination for allegedly refusing to allow a woman with mental disabilities to keep an assistance animal. The Fair Housing Act prohibits housing providers from denying or limiting housing to persons with disabilities or from refusing to make reasonable accommodations in policies or practices. This includes denying a request for an assistance animal.

Treasury and the IRS have issued a joint notice they will issue proposed regulations in the near future addressing legislation adopted or being considered by state legislatures that allow taxpayers to receive a credit against their state and local taxes for contributions to certain organizations or funds designated by the state. In addition to cutting income tax rates, expanding the child tax credit, and nearly doubling the standard deduction, the Tax Cuts and Jobs Act limited the amount of state and local taxes an individual can deduct in a calendar year to $10,000.

• Press release

An article in the May 2018 edition of the OCC's Community Development Investments newsletter reviews how minority depository institution (MDI) collaborations with large and midsize banks can be profitable for the parties involved and help MDIs fulfill their missions and serve customers in a rapidly evolving industry.

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has designated five Iranian individuals who have provided ballistic missile-related technical expertise to Yemen’s Huthi terrorists, and who have transferred weapons not seen in Yemen prior to the current conflict, on behalf of the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF). For identification information on the five targeted individuals, see our OFAC Update.

As a result of these actions, all property and interests in property of those designated today subject to U.S. jurisdiction are blocked, and U.S. persons are generally prohibited from engaging in transactions with them. In addition, foreign financial institutions that knowingly facilitate significant transactions for, or persons that provide material or certain other support to, the individuals and entities designated today risk exposure to sanctions that could sever their access to the U.S. financial system or block their property and interests in property under U.S. jurisdiction.

On May 16, 2018, FinCEN issued Administrative Ruling FIN-2018-R002, "Beneficial Ownership Requirements for Legal Entity Customers of Certain Financial Products and Services with Automatic Rollovers or Renewals," to provide a 90-day limited exceptive relief from the obligations of the Beneficial Ownership rule with respect to certain financial products and services that automatically rollover of renew (certificates of deposit or loan accounts). On May 22, FinCEN announced a correction to the last paragraph of the Administrative Ruling, where the rules applicability date was incorrectly given. The date has been corrected to May 11, 2018. The revised version of FIN-2018-A002 is available on FinCEN's website.

Editor's Note: The "exceptive relief" provided by FIN-2018-R002 extends only to certificates of deposit and loans that automatically rollover or renew. Loan renewals that are not automatic are not covered, and currently are subject to Beneficial Ownership requirements. They are covered, however, by Question 12 in FinCEN's April 3, 2018, Guidance FAQs (FIN-2018-G001).

OFAC has posted a notice that it has issued Ukraine-/Russia-related General License 15, which authorizes U.S. persons to engage in specified transactions related to winding down or maintaining business with GAZ Group and its subsidiaries until October 23, 2018. OFAC is also issuing Ukraine-/Russia-related General License 12C, which replaces and supersedes General License 12B in its entirety. General License 12C permits originating and intermediary U.S. financial institutions to process funds transfers that they would otherwise block to an account held by a blocked U.S. person at a U.S. financial institution. In addition, General License 12C clarifies that U.S. financial institutions can release such funds for authorized maintenance and wind-down purposes. OFAC is also publishing six new Frequently Asked Questions (FAQs) and revisions to existing FAQs about these general licenses.

The president has signed S.J. Res. 57, a joint resolution of disapproval under the Congressional Review Act (CRA) of the rule issued by the CFPB in the form of guidance concerning indirect automobile lender compliance with the ECOA and Regulation B. The March 21, 2013, guidance, in CFPB Bulletin 2013-02, has been voided by the CRA action, and the Bureau is now banned from reissuing a substantially similar rule unless specifically authorized to do so by law, according to a statement by Acting Bureau Director Mick Mulvaney.

Mulvaney also said that, following a recent Supreme Court decision "distinguishing between antidiscrimination statutes that refer to the consequences of actions and those that refer only to the intent of the actor, and in light of the fact that the Bureau is required by statute to enforce federal consumer financial laws consistently, the Bureau will be reexamining the requirements of the ECOA." The Bureau will also be reviewing other guidance documents it has issued with congressional staff and federal agency partners to identify those that must be submitted to Congress for review under the CRA.

The President has issued an Executive Order, "Prohibiting Certain Additional Transactions with Respect to Venezuela." All transactions related to, provision of financing for, and other dealings in the following by a United States person or within the United States are prohibited:

• the purchase of any debt owed to the Government of Venezuela, including accounts receivable;
• any debt owed to the Government of Venezuela that is pledged as collateral after the effective date [12:30 p.m. EDT on May 21, 2018] of the order, including accounts receivable; and
• the sale, transfer, assignment, or pledging as collateral by the Government of Venezuela of any equity interest in any entity in which the Government of Venezuela has a 50 percent or greater ownership interest.

The Federal Emergency Management Agency has published a final rule in today's Federal Register announcing that it will suspend unincorporated areas of Mason County, Illinois, and the City of Harvey, Wells County, North Dakota, from the National Flood Insurance Program on June 6, 2018, for failure to comply with the floodplain management requirements if the program.