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Top Story Compliance Related

12/12/2019

Operators of debt collection scheme banned

The Federal Trade Commission has announced that, under the terms of a settlement agreement with the Commission, the operators of a scheme that conned consumers into paying non-existent debts will be permanently banned from the debt collection business and from misleading consumers about debt. A complaint filed by the FTC against Global Asset Financial Services Group, LLC alleges that the operators of the company falsely claimed to be attorneys or affiliated with attorneys to pressure consumers into making payments on debts they did not owe, and threatened to take legal action against consumers if they did not pay. In addition to being banned from debt collection, debt brokering activities, and misleading consumers, the defendants also will be banned from misrepresenting to consumers whether they are attorneys.

12/12/2019

McWilliams on Brokered Deposits rule

In her keynote address at the Brookings Institution yesterday, FDIC Chairman Jelena McWilliams spoke on "Brokered Deposits in the FinTech Age." After discussing the history of the general prohibition on brokered deposits at banks with lower capital ratios, which was a reaction to the failures in 1982 of Pacific Coast Bank and Penn Square Bank, McWilliams discussed a revised rule with a new framework for brokered deposits that the FDIC Board is scheduled to vote on today.

12/12/2019

FDIC schedules 'listening session' webinar

FDIC FIL-80-2019, issued yesterday, announces a webinar to solicit feedback regarding its supervisory appeals and dispute resolution processes for FDIC-supervised financial institutions. The session will offer an opportunity for bankers and other interested parties to provide input and recommendations regarding these processes. Participants will also be asked to provide suggestions regarding the role of the Office of the Ombudsman in assisting in resolving disagreements. Participants will be requested to provide suggestions on information that the agency could publish on these topics.

The webinar is scheduled for 1:00 p.m. to 2:30 p.m. EST on Thursday, December&nps;19, using Cisco WebEx conferencing software. A Fact Sheet supplies additional details.

12/12/2019

Fed issued three outstanding CRA evals in November

Our review of the CRA evaluations made public by the Federal Reserve Board in November reveals that, of the 21 evaluations issued that month, 18 received a Satisfactory rating, and these three institutions' evaluations were rated Outstanding (links are to their evaluation reports):

12/12/2019

OFAC designates weapons network and Mahan Air agents

Treasury has announced that OFAC has designated an Iranian shipping network involved in smuggling lethal aid from Iran to Yemen on behalf of the Islamic Revolutionary Guards Corps-Qods Force (IRGC-QF). OFAC also designated three Mahan Air general sales agents—Gatewick LLC, Jahan Destination Travel and Tourism LLC, and Gomei Air Services Co., Ltd—based in the United Arab Emirates and Hong Kong. Mahan Air was designated in 2011 for providing financial, material, or technological support for or to the IRGC-QF. See BankersOnline's OFAC Update for identification details.

12/11/2019

University of Phoenix pays $191M to settle charges

The Federal Trade Commission has announced the University of Phoenix and its parent company, Apollo Education Group, will settle for a record $191 million to resolve FTC charges that they used deceptive advertisements that falsely touted their relationships and job opportunities with companies such as AT&T, Yahoo!, Microsoft, Twitter, and The American Red Cross. Under the settlement, the university will pay $50 million in cash and cancel $141 million in debts owed to the school by students who were harmed by the deceptive ads. A complaint filed by the Commission alleged that the university and Apollo relied heavily on advertising to attract students, including specific ads that targeted military and Hispanic consumers. The companies’ ads featured employers such as Microsoft, Twitter, Adobe, and Yahoo!, giving the false impression that the university worked with those companies to create job opportunities for its students and tailor its curriculum for such jobs.

12/11/2019

Retirees distribution deadline reminder

The Internal Revenue Service reminds retirees born before July 1, 1949, that they usually must take distributions from their retirement plans by December 31. The payments, called required minimum distributions (RMDs), are normally made by the end of the year. Those who turned 70½ in 2019 are allowed to wait until April 1, 2020, to take their first RMDs. The special April 1 deadline only applies to the RMD for the first year. For all subsequent years, the RMD must be made by December 31. For example, a taxpayer who turned 70½ in 2018 and received the first RMD on April 1, 2019, must receive a second RMD by December 31, 2019. The required distribution rules apply to:

  • Owners of traditional Individual Retirement Arrangements (IRAs)
  • Owners of traditional Simplified Employee Pension (SEP) IRAs
  • Owners of Savings Incentive Match Plans for Employees (SIMPLE) IRAs
  • Participants in various workplace retirement plans, including 401(k), 403(b) and 457(b) plans

12/11/2019

Blanco addresses enforcement conference

Kenneth A. Blanco, Director of the Financial Crimes Enforcement Network (FinCEN), spoke at the American Bankers Association/American Bar Association (ABA/ABA) Financial Crimes Enforcement Conference on December 10, 2019. He addressed how FinCEN uses BSA data, particularly as it relates to filings involving convertible virtual currency; the status of FinCEN’s BSA Value Project; the importance of beneficial ownership information; FinCEN’s ongoing federal banking agency working group efforts; and some significant organizational changes within FinCEN.

In his discussion of beneficial ownership information, Blanco said that there is more work to be done in that arena, and that collecting beneficial ownership information at the corporate formation stage is the next criitical step. He said that FinCEN is committed to working with key stakeholders, including Congress, to find effective, sensible solutions to address this serious and growing gap in our national security.

12/11/2019

NMLS renewal period ends soon

The NMLS has posted a reminder that the annual renewal period for registered mortgage loan originators (MLOs) (organizations and individuals) ends December 31. Failure to renew an institution's registration may impact its MLOs’ ability to engage in mortgage loan origination activity, just as failures of individual MLOs to complete their renewal process will prevent them from legally acting in that role after year-end. For complete information, visit the Renew-Reactivate page of the NMLS Federal Registry Resource Center.

12/11/2019

FDIC updates Compliance Examination Manual

The FDIC has updated its Consumer Compliance Examination Manual to add new section X-6.1 on Disclosure Requirements for Sweep Accounts, to include examination procedures for FDIC Part 360.8(e), which requires consumer disclosures for sweep account transactions to inform whether the swept funds are deposits.

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