Top Story Compliance Related

The OCC has announced its Office of Innovation will host Office Hours for national banks, federal savings associations, and financial technology companies, July 24–26, at the OCC’s district office in New York City. Office Hours provide an opportunity for meetings with OCC officials to discuss financial technology, new products or services, partnering with a bank or fintech company, or other matters related to financial innovation. OCC staff will provide feedback and respond to questions. Each meeting will be no longer than one hour. Interested parties may request a session through July 5, and are asked to provide information on why they are interested in meeting with the OCC. Specific meeting times and arrangements will be determined after the OCC receives and accepts the request.

The Federal Deposit Insurance Corporation (FDIC) has appointed M. Anthony Lowe to the post of FDIC Ombudsman and Director of the Office of the Ombudsman. The Ombudsman's office interacts extensively with bankers, other industry representatives, community groups, and members of the public to answer questions and hear concerns about FDIC policies and regulations. The office serves as both a resource and a liaison to facilitate the resolution of issues with financial institutions fairly and impartially.

President Trump has announced on Friday his intent to nominate James Clinger of Pennsylvania to be a member of the Federal Deposit Insurance Corporation Board for a term of six years, and to be Chairperson for a term of five years, effective November 29, 2017. Mr. Clinger is currently the Chief Counsel for the House Committee on Financial Services, having held this position since 2007.

OFAC has posted new frequently asked questions in connection with last week's White House announcement of changes to U.S. policy with respect to Cuba.

The OCC has released a list of recent enforcement actions taken against national banks, federal savings associations, and individuals currently and formerly affiliated with national banks and federal savings associations. Included was one personal cease and desist order with an order for payment of an $8,000 civil money penalty against a former Illinois mortgage loan originator who sent customer information from his former employer to a prospective new employer without permission. There were also two removal/prohibition orders, and a cease and desist order against a Connecticut federal branch of UBS AG, a Swiss bank.

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has reported that it took action Friday against Fared Saal (Saal), an Islamic State of Iraq and Syria (ISIS) facilitator, recruiter, and fighter. Saal is being designated as a Specially Designated Global Terrorist (SDGT) pursuant to Executive Order 13224, which targets terrorists and their supporters. As a result of Friday’s action, all property and interests in property of Saal subject to U.S. jurisdiction are blocked, and U.S. persons are generally prohibited from engaging in transactions with him. For identification information, see our OFAC Update.

The Federal Trade Commission has mailed 288 checks totaling more than $109,000 to people who paid an up-front fee to Regency Financial Services, which promised to get them better terms for their auto loans. According to the FTC, the company and its CEO, Ivan Levy, did not provide the promised services and failed to honor their “money-back guarantee.”

• FTC press release

The Office of Foreign Assets Control has published a final rule effective today, June 16, 2017, removing from the Code of Federal Regulations the Burmese Sanctions Regulations as a result of the termination of the national emergency on which the regulations were based. OFAC has removed 31 CFR part 537.

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) took action Thursday to disrupt an Islamic State of Iraq and Syria (ISIS) financial facilitation network by designating one individual and one entity pursuant to Executive Order 13224, which targets terrorists and those providing support to terrorists or acts of terrorism. Specifically, OFAC designated Umar al-Kubaysi and his company, Al-Kawthar Money Exchange, building upon OFAC’s December 2016 actions, which marked the first designations of ISIS-linked money services businesses. As a result of this action, 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.

Additionally, the Department of State designated ISIS members Mohammad Shafi Armar, Oussama Ahmad Atar, and Mohammed Isa Yousif Saqar Al Binali.

OFAC has added all four individuals and the money exchange to its SDN List. For ID information, see our OFAC Update.

The Consumer Financial Protection Bureau announced on Thursday it is proposing updates to its prepaid rule, which was issued in 2016, and is, after an earlier change, scheduled to become effective April 1, 2018. The proposal would adjust requirements for resolving errors on unregistered accounts and provide greater flexibility for credit cards linked to digital wallets. Under the first change, consumers would need to register their accounts to receive full fraud and error protection benefits such as the right to dispute charges and have stolen money restored. The proposal would require companies to provide these protections to registered accounts even if the theft or dispute occurred before registration was successfully completed.

The proposal affecting digital wallets would ensure that consumers continue to receive full CARD Act protections on their traditional credit card accounts while making it easier for them to link those accounts to their digital wallet prepaid accounts. The Bureau is also proposing additional minor adjustments and clarifications to aspects of the prepaid rule that industry members have expressed concerns about. Comments on the proposal will be accepted for 45 days following Federal Register publication.

UPDATE: Published in Federal Register on June 29, 2017. Comments due by August 14, 2017.

The Bureau also released an updated version of its small entity compliance guide for the rule, reflecting the April 1, 2018, effective date and clarifications on several issues for which the industry has raised questions or asked for added clarity.

• Bureau's proposal