Top Story Compliance Related

The FDIC has released a list of 24 administrative enforcement actions taken against banks and individuals in October 2016. The actions included two consent orders, seven removal and prohibition orders, six Section 19 orders, four civil money penalties, and five terminations of consent orders and cease and desist orders. There was an order of prohibition from further participation and an order to pay a civil money penalty of $125,000 to a former institution-affiliated party of Pacific Valley Bank, Salinas, California. There were also orders to pay civil money penalties for violations of the Flood Act issued to Bank of Kampsville, Kampsville, Illinois ($21,819), and to TSB Bank, Lomira, Wisconsin ($7,100).

FinCEN has announced that the U.S. District Court for the District of Columbia has remanded to FinCEN a Final Rule issued under Section 311 that would have severed FBME Bank Ltd. from the U.S. financial system. In its memorandum opinion, the court stated that FinCEN had not meaningfully responded to FBME’s comments regarding FinCEN’s treatment of aggregate Suspicious Activity Report (SAR) data. FinCEN today submitted for publication in the Federal Register a Supplement to the Final Rule that responds to FBME’s comments.

UPDATE: FinCEN Supplement, published in December 1, 2016, Federal Register

The Federal Reserve Board and the Consumer Financial Protection Bureau have announced they have issued final rules detailing the method that will be used to adjust the thresholds for exempting certain consumer credit and lease transactions from the Truth in Lending Act and Consumer Leasing Act. The final rules also apply the calculation method to the thresholds for exempt credit and lease transactions for 2017. The thresholds will remain at $54,600 based on the CPI-W in effect on June 1, 2016. The thresholds last changed on January 1, 2015. The amendments made by the final rules, which will be effective January 1, 2017, have been posted to the BankersOnline Regulations pages for Regulations M and Z.

• Regulation M final rule, published 11/30/16 at 81 FR 86256
• Regulation Z final rule, published 11/30/16 at 81 FR 86260

The Consumer Financial Protection Bureau (CFPB), Federal Reserve Board, and Office of the Comptroller of the Currency (OCC) have announced they have issued a final rule detailing the method that will be used to make annual inflation adjustments to the threshold for exempting small loans from special appraisal requirements. The final rule also applies the calculation method to the exemption threshold for 2017. The threshold will remain at $25,500, based on the CPI-W in effect on June 1, 2016. The final rule will be effective January 1, 2017.

UPDATE: Published at 81 FR 86250, 11/30/16

U.S. District Judge Amos Mazzant, of the U.S. District Court for the Eastern District of Texas, has approved a motion for a preliminary injunction filed by Nevada and 23 other states, in the case of State of Nevada, et al v. United States Department of Labor, et al. The injunction blocks implementation of the Department of Labor's revised Overtime Rule, which was scheduled to become effective on December 1, 2016. The plaintiffs' suit alleges that the Labor Department exceeded its authority in setting the payroll thresholds (and the automatic updating mechanism affecting them) triggering overtime pay.

The injunction is effective nationwide, and will remain in effect pending further order of the court, which typically means until the decision is made on the underlying case.

The Department of the Treasury's Office of Foreign Assets Control has added Specially Designated Global Terrorist (SDGT) designations to its Specially Designation Nationals Lists. Four individuals were added, and two designated narcotics traffickers with the Kingpin Act designation were updated to add the SDGT designation. See our OFAC Update for details.

The National Credit Union Administration has announced that, beginning with the Call Report for the quarter ending December 31, 2016, federally insured credit unions will have until the last Sunday of the month following quarter end to file Call Reports. The due dates in 2017 are January 29, April 30, July 30, and October 29. This change gives credit unions, on average, an additional seven days to file.

The OCC has issued Bulletin 2016-41 as a reminder of the FFIEC Advance Notice of Proposed Rulemaking (ANPR) published on October 26 regarding enhanced cyber risk management standards for large and interconnected entities under the jurisdiction of the OCC, Board of Governors or the FDIC. The ANPR was featured in our October 20, 2016, Top Story. Comments on the ANPR are due by January 17, 2017.

The CFPB published two documents in this morning's Federal Register:

• The final rule on Prepaid Accounts, which becomes effective October 1, 2017, as reported in our October 5 Top Story
• The Bureau's Request for Information on consumer access to financial account and account-related data, reported in a November 17 Top Story. Publication of the Request for Information began a 90-day response period, which will end on February 21, 2017.

The CFPB has filed a complaint in federal district court against Access Funding, LLC for an illegal scheme in which victims of lead-paint poisoning and others signed away future settlement payments in exchange for a significantly lower lump-sum payout. The CFPB alleges that Access Funding steered victims to receive “independent advice” from a sham advisor, an attorney who was actually paid directly by the company and provided virtually no advice, indicating to consumers that the transactions required little scrutiny. In its suit, the CFPB seeks to put an end to the company’s unlawful practices, obtain relief for the harmed consumers, and impose penalties.

• Complaint