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Top Story Compliance Related

04/17/2020

Final rule raising data reporting thresholds under HMDA

The Consumer Financial Protection Bureau has announced a final rule raising the loan-volume coverage thresholds for financial institutions reporting data under the Home Mortgage Reporting Act (HMDA).

The final rule, amending Regulation C, increases the permanent threshold for collecting and reporting data about closed-end mortgage loans from 25 to 100 loans effective July 1, 2020. The final rule will also amend Regulation C to increase the permanent threshold for collecting and reporting data about open-end lines of credit from 100 to 200, effective January 1, 2022, when the current temporary threshold of 500 of open-end lines of credit expires. In October 2019, the Bureau extended the temporary open-end threshold until January 1, 2022. But for today’s final rule, the open-end threshold would have reverted to 100 open-end lines of credit upon the expiration of the temporary threshold.

An Executive summary of the final rule includes guidance for institutions transitioning from being reporting institutions to excluded institutions for closed-end mortgage loans effective July 1, 2020.

KATHLEEN BLANCHARD will present a Live Webinar on the New HMDA Changes on May 29, 2020. REGISTER NOW!

The final rule was published at 85 FR 28364 on May 12, 2020.

04/17/2020

FDIC postpones modification of signage and ad requirements

The FDIC has announced it will temporarily postpone its efforts to modify its signage and advertising requirements. The agency remains committed to modernizing these rules at a future date to better reflect how banks and savings associations are transforming their business models to take deposits via physical branches, digital, and mobile banking channels.

04/17/2020

New FFIEC calculation tools announced

The Federal Institutions Examination Council has announced the availability of two FFIEC federal disclosure computational tools: the Annual Percentage Rate (APR) Computational Tool and the Annual Percentage Yield (APY) Computational Tool. These web-based tools facilitate supervision of financial institutions with regard to applicable laws and regulations and assist financial institutions in their efforts to comply with those laws and regulations. The OCC has discontinued use of its Annual Percentage Rate Calculation Program for Windows (APRWIN) and Annual Percentage Yield Calculation Program for Windows (APYWIN) in favor of the FFIEC Federal Disclosure Computational Tools. The OCC's APRWIN and APYWIN are no longer available for download.

04/17/2020

OSA Annual Servicemember Affairs Report for 2019

The CFPB’s Office of Servicemember Affairs (OSA) has posted its Annual Report for Fiscal Year 2019.The report is a review of OSA’s activities in fulfilling its statutory responsibilities over the course of FY19, which covers the period from October 1, 2018 to September 30, 2019. Of note to financial institutiions is section 3 of the report, which addresses military consumer complaints. As in past years, the leading complaint subjects were:

  • Credit or consumer reporting
  • Debt collection
  • Mortgages
  • Credit card
  • Checking or savings accounts

04/16/2020

FFIEC updates BSA/AML Exam Manual

FDIC FIL-44-2020 announced Wednesday evening (April 15, 2020) that the Federal Financial Institutions Examination Council (FFIEC) has updated several sections and related examination procedures in the FFIEC Bank Secrecy Act/Anti-Money Laundering Examination Manual. The updated sections provide transparency into the BSA/AML exam process and do not establish new requirements. The changes should not be interpreted as new instructions or as an augmented examination focus.

Many of the revisions are designed to emphasize and enhance the risk-focused approach to BSA/AML supervision. An interagency statement accompanying the FIL provides information on the updated sections, all of which are identified in the April 2020 Update also provided with the FIL. Those sections are identified with an April 2020 date in the table of contents and on the FFIEC BSA/AML InfoBase. Updates to other sections of the Manual will be released in phases later.

04/16/2020

Advisory on cyber threat posed by North Korea

OFAC has posted a notice that the U.S. Departments of State, Homeland Security, and Treasury, and the Federal Bureau of Investigation issued a DPRK Cyber Threat Advisory​ to raise the awareness of the cyber threat posed by North Korea. The advisory highlights North Korea’s malicious cyber activities around the world, identifies U.S. government resources that provide technical and threat information, and includes recommended measures to counter the cyber threat.

04/14/2020

FinCEN mirrors SBA PPP FAQs on Beneficial Ownership

FinCEN has posted a Paycheck Protection Program FAQs document that mirrors two of the SBA's FAQs regarding implementation of the Paycheck Protection Program (PPP) that involve explaining the requirements under the Bank Secrecy Act (BSA), and how lenders can meet those requirements when issuing a PPP loan.

[FinCEN's action adopts the SBA's interpretation of how Beneficial Ownership certification requirements will apply to PPP customers, which differs from FinCEN regulations. At the same time, FinCEN carefully stated in the text preceding the two FAQs, that, as "administrator of the BSA, [FinCEN] is re-publishing those FAQs in this document [and] will update its document with any additional BSA-related FAQs involving the PPP," apparently reclaiming its authority over the interpretation of its own regulations. -- Editor]

04/09/2020

Temporary relief for business development companies

The Securities and Exchange Commission has announced that it is providing temporary, conditional exemptive relief for business development companies (BDCs) to enable them to make additional investments in small and medium-sized businesses, including those with operations affected by COVID-19. BDCs were created to provide capital to smaller domestic operating companies that otherwise may not be able to readily access the capital markets. The relief announced Wednesday will provide additional flexibility for BDCs to issue and sell senior securities in order to provide capital to such companies, and to participate in investments in these companies alongside certain private funds that are affiliated with the BDC. The relief is subject to investor protection conditions, including specific requirements for obtaining an independent evaluation of the issuances’ terms and approval by a majority of a BDC’s independent board members.

04/09/2020

OFAC adjusts penalties for inflation

​OFAC has published a final rule at 85 FR 19884 in today's Federal Register amending its regulations to adjust certain civil monetary penalties for inflation as required by law. The rule is effective upon publication.

04/08/2020

SEC publishes risk alerts regarding inspections

The SEC office of Compliance Inspections and Examinations (OCIE) has issued two risk alerts: Examinations that Focus on Compliance with Regulation Best Interest and Examinations that Focus on Compliance with Form CRS. These risk alerts provide broker-dealers and investment advisers with advance information about the expected scope and content of the initial examinations for compliance with Regulation Best Interest and Form CRS. Regulation Best Interest and Form CRS are key components of a broader package of rules and interpretations, adopted contemporaneously on June 5, 2019, to enhance the quality and transparency of retail investors’ relationships with broker-dealers and investment advisers. The compliance date for Regulation Best Interest and Form CRS is June 30, 2020.

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