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Exception Tracking Spreadsheet (TicklerTrax™)
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Top Story Compliance Related

09/09/2016

FTC action bans payday debt relief operation

The Federal Trade Commission has announced that the owners of a debt relief operation that targeted consumers with outstanding payday loans will be banned from the debt relief business under settlements with the Commission. In February 2015, the FTC filed a complaint alleging that Jared Irby, Richard Hughes, Coastal Acquisitions LLC, PSC Administrative LLC, who typically did business as “Payday Support Center” or “Infinity Client Solutions,” falsely promised to resolve consumers’ payday loans through their hardship program. Once enrolled, consumers stopped making payments to their lenders, but the defendants failed to provide the promised debt relief, and consumers ended up in deeper financial trouble, having paid hundreds of dollars for no reduction or settlement of their loans, according to the agency.

09/09/2016

FinCEN advisory on FATF update

FinCEN FIN-2016-A004, issued September 7, is an advisory on the Financial Action Task Force (FATF) June 2016 update of its list of jurisdictions with strategic AML/CFT deficiencies. These changes may affect U.S. financial institutions’ obligations and risk-based approaches with respect to relevant jurisdictions. For additional information see our June 27, 2016 Top Story, "FATF updates statements on high-risk and non-cooperative jurisdictions."

09/09/2016

Proposal to prohibit dealing and investing in certain metals

The OCC has issued a news release and issued Bulletin 2016-26 requesting comments on a proposed rule to prohibit national banks and federal savings associations from dealing and investing in industrial or commercial metals. The proposal covers metal, including alloy, in a physical form primarily suited to industrial or commercial uses. Examples include copper cathodes and aluminum T-bars. If finalized in its current form, this proposal would supersede a prior OCC determination permitting national banks to trade copper cathodes.

Update: The proposed rule was published at 81 FR 63428 on September 15, 2016. Comments close November 14, 2016.

09/09/2016

Regulators issue banking report to Congress and FSOC

The Federal Reserve Board, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency have jointly announced the release of a report to the Congress and the Financial Stability Oversight Council (FSOC) on the activities and investments that banking entities may engage in under applicable law. Each agency prepared the section of the report relative to the banking entities that it supervises. Each of the three sections includes a discussion of permissible activities, risk mitigation, legal limitations, and specific recommendations as required by the Dodd-Frank Act.

09/09/2016

Phoenix settles housing discrimination complaints

The Department of Housing and Urban Development has announced its approval of an agreement between the City of Phoenix, Arizona, and two fair housing organizations resolving multiple complaints of housing discrimination. The Southwest Fair Housing Council (SFHC) and the Arizona Fair Housing Center (AFHC) alleged Phoenix violated the Fair Housing Act, the Civil Rights Act of 1964, the Rehabilitation Act, and the Americans with Disabilities Act (ADA) in its administration of the city's federally funded Housing Choice Voucher program. The organizations claimed the city did not make its online pre-application process accessible to persons with disabilities, provided vital documents in English only, and failed to notify applicants with limited English proficiency (LEP) that they could request language assistance.

09/09/2016

Incentive program costs Wells Fargo $185 M in CMPs

Wells Fargo Bank, N.A., will pay civil money penalties totaling $185 million and make about $2.5 million in restitution payments for failing to monitor and control a cross-selling incentive program. The CFPB, OCC and the Office of the Los Angeles (California) City Attorney announced on Thursday that they have imposed monetary penalties of $100 million, $35 million and $50 million, respectively, on the bank. The bank encouraged sales of new accounts and services in a program that established sales goals and bonus incentives, and a widespread employee practice developed that boosted sales figures by opening deposit and credit card accounts without customer authorization. The bank determined that as many as two million accounts were opened that may not have been authorized, and stated that about 5,300 employees involved in the scheme have been fired "over the last few years."

The CFPB found the bank's actions to be unfair and abusive under the Consumer Financial Protection Act of 2010. The OCC found the actions to be unsafe and unsound practices. The City of Los Angeles settled a 2015 suit brought against the bank alleging violations of California's Unfair Competition Law.

For more on this story, see "Wells Fargo sales incentives lead to $185M in CMPs," in our Penalties pages.

09/08/2016

FTC bans debt collectors and issues $4.4M CMP

The Federal Trade Commission has announced that two groups of debt collectors will be banned from the collection business under settlements with the regulator, and one of them will pay more than $4.4 million civil money penalty (CMP) to resolve charges that they conned people into paying debts they did not owe. A stipulated order resolves FTC charges brought in November 2015 against the businesses. See our January 8, 2016, Top Story, "Operation Collection Protection shuts down abusive collectors," for the details. The court had halted the operation, frozen the defendants’ assets, and appointed a receiver to control the business pending litigation.

09/08/2016

Tech company settles with OFAC

OFAC has announced a $43,200 settlement with World Class Technology Corporation to settle potential civil liability for alleged violations of the Iranian Transactions and Sanctions Regulations. See "World Class Technology Corp settles OFAC liability," in our Penalties pages, for more information.

09/06/2016

FDIC CRA evaluations posted

The FDIC has posted its September list of banks whose Community Reinvestment Act (CRA) evaluation ratings have recently become public. Three of the listed banks received ratings of "Outstanding." The remaining 57 institutions received ratings of "Satisfactory."

09/06/2016

OCC August CRA evaluations

The OCC has released a list of Community Reinvestment Act (CRA) performance evaluations that became public during August 2016. The list contains only national banks, federal savings associations, and insured federal branches of foreign banks that have received ratings. The possible ratings are outstanding, satisfactory, needs to improve, and substantial noncompliance. Seven on the list are rated outstanding, 22 are rated satisfactory and one is rated substantial noncompliance.

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