Skip to content

How to gain more from operational risk management practices.
Modern risk management technology solutions improve efficiency and provide greater visibility into risks. Today’s tools provide real-time visibility, action plans, enhanced reporting and business intelligence, and proactive notifications for operational risk. Real-time data empowers banks and financial services organizations to proactively manage risks and instantly detect and mitigate emerging issues. Click here to learn more.


Top Story Compliance Related

05/19/2020

Labor may allow OT exemption for commissioned loan officers

The Department of Labor has published a final rule at 85 FR 29867 in the May 19, 2020, Federal Register withdrawing the "partial list of establishments" with "no retail concept" and the "partial list of establishments" that "may be recognized as retail" for the purposes of determining whether a business may qualify for an exemption from the Fair Labor Standards Act's overtime compensation requirement for certain commissioned employees employed by a retail or service establishment.

The elimination of the lists from Labor's regulations at 29 CFR 779 will promote consistent treatment when evaluating exemption claims by treating all businesses equally under the same standards. Banking and mortgage lending trade representatives have claimed the two lists have prevented mortgage lenders from applying for exemptions from the overtime requirement for mortgage loan officers who may earn more than half their income from commissions.

05/14/2020

FDIC updates exam manual

The FDIC has released its April 2020 updates to its Consumer Compliance Examination Manual. The following sections were updated:

  • Pre-Examination Planning (II-4.1): Updated to incorporate changes to the process.
  • Pre-Examination Information Packet Template (III-1.1): Changes to the Pre-Examination Planning process have been reflected in the Template.
  • Truth in Lending Act (V-1.1): Updated to reflect annual threshold changes. The escrow exemption and the appraisal exemption thresholds for higher priced mortgages and the credit card penalty fee safe harbor amount were increased.
  • Home Mortgage Disclosure Act (V-9.1): Updated to reflect updated loan volume thresholds. The asset size exemption thresholds were also updated.
  • Consumer Leasing Act (V-10.1): The exemption threshold for consumer credit and lease transactions were increased.
  • Community Reinvestment Act (XI-1.1): Asset-based definitions for Small Banks and Intermediate Small Banks were updated.

05/14/2020

CFPB statement on responsibility during pandemic

The CFPB has released a statement and FAQs outlining the responsibility of certain financial firms during the pandemic. In the statement, the Bureau outlines the billing error responsibilities of credit card issuers and other open-end non-home secured creditors during the COVID-19 pandemic. Additionally, the Bureau encourages financial firms to continue to provide the kind of assistance to their communities that many have been providing, such as waiving fees, lowering minimum-balance requirements, and implementing changes in account terms that benefit consumers.

It should be noted that these are Bureau statements, which may not reflect the positions of other federal financial regulators.

05/14/2020

OFAC updates 490 North Korea-related SDN listings

OFAC has posted a notice that it has added descriptive text to 490 SDN listings to reflect a prohibition on foreign subsidiaries of U.S. financial institutions from knowingly engaging in transactions with SDNs designated under North Korea-related authorities.

The added text reads: "Transactions Prohibited For Persons Owned or Controlled by U.S. Financial Institutions: North Korea Sanctions Regulations section 510.214.” The prohibition was added by the North Korea Sanctions and Policy Enhancement Act (NKSPEA) as modified by the National Defense Authorization Act for Fiscal Year 2020.

For the list of affected SDNs, see OFAC's May 13, 2020, notice.

05/13/2020

Morgan Stanley Smith Barney pays $5M SEC penalty

The Securities and Exchange Commission has reported that Morgan Stanley Smith Barney LLC (MSSB) has agreed to settle charges that it provided misleading information to clients in its retail wrap fee programs regarding trade execution services and transaction costs. MSSB has agreed to pay a $5 million penalty that will be distributed to harmed investors. Wrap fee programs offer accounts in which clients pay an asset-based “wrap fee” that covers investment advice and brokerage services, including trade execution.

05/13/2020

OCC Bulletin on changes to annual meeting dates

The OCC has issued Bulletin 2020-51 in response to inquiries from banks that are considering changes to the date, time, or location of their annual meetings as a result of stay-at-home and similar orders and potential health concerns. The bulletin also addresses the specific regulatory requirements applicable to federal savings associations (FSA) that may seek to delay their annual meetings.

05/12/2020

Colorado mortgage-loan servicer to pay consumers $1.275M

The CFPB has announced a settlement with Specialized Loan Servicing, LLC (SLS), a mortgage-loan servicer in Colorado. As of February 29, 2020, SLS serviced a portfolio of mortgage loans worth about $112.69 billion. The consent order requires SLS to pay $1.275 million in monetary relief to consumers in the form of redress and waiver of borrower deficiencies, pay a $250,000 civil money penalty to be deposited into the Bureau’s Civil Penalty Fund, and implement procedures to ensure compliance with the Real Estate Settlement Procedures Act (RESPA) and its implementing regulation, Regulation X. The Bureau’s investigation found that since January 2014, SLS violated RESPA and Regulation X by taking prohibited foreclosure actions against mortgage borrowers who were entitled to protection from foreclosure, and by failing to send or to timely send evaluation notices to mortgage borrowers who were entitled to them. SLS's actions were also found to have violated the Consumer Financial Protection Act of 2010.

05/11/2020

FinCEN renews GTOs

The Financial Crimes Enforcement Network (FinCEN) announced the renewal of its Geographic Targeting Orders (GTOs) that require U.S. title insurance companies to identify the natural persons behind shell companies used in all-cash purchases of residential real estate in twelve metro areas. The renewed GTOs are identical to the November 2019 GTOs, and will be effective from May 10 through November 5, 2020. The purchase amount threshold remains $300,000 for each covered metropolitan area. An FAQ regarding the GTOs was also issued.

05/08/2020

IRS proposes regs for estates and trusts

The IRS has announced it is issuing proposed regulations to provide guidance for estates and trusts clarifying that certain deductions of estates and non-grantor trusts are not miscellaneous itemized deductions. The Tax Cuts and Jobs Act prohibits individual taxpayers from claiming miscellaneous itemized deductions for any taxable year beginning after December 31, 2017, and before January 1, 2026. Specifically, the proposed regulations clarify which deductions are allowable in figuring adjusted gross income and are not miscellaneous itemized deductions

05/07/2020

Bureau Compliance Aid on ECOA and PPP applications

The CFPB has issued a Compliance Aid with three clarifying FAQs on the topic of "SBA Paycheck Protection Program and Notification of Action Taken."

The FAQs clarify that a PPP application is only a “completed application” once the creditor has received a loan number from the SBA or a response about the availability of funds. This ensures that the time awaiting this information from the SBA does not count towards the 30-day notice requirement, and that applications will therefore not “time out” during the process.

The FAQs also make clear that if the creditor denies an application without ever sending the application to the SBA, the creditor must give notice of this adverse action within 30 days. It further clarifies that a creditor cannot deny a loan application based on incompleteness where the creditor has enough information for a credit decision but has yet to receive a loan number or response about the availability of funds from the SBA.

Pages

Training View All

Penalties View All

Search Top Stories