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Top Story Compliance Related

01/31/2020

New York bank pays for flood insurance violations

The Federal Reserve Board has announced it has imposed a $36,500 civil money penalty on Alden State Bank, Alden, New York, for a pattern or practice of unspecified violations of the National Flood Insurance Act and section 208.25 of Federal Reserve Regulation H.

01/31/2020

Control rule transparency changes finalized by Fed

The Federal Reserve Board yesterday approved a final rule to simplify and increase the transparency of the Board's rules in Regulations Y and LL for determining control of a banking organization. If a company has control over a banking organization, the company generally becomes subject to the Board's rules and regulations. The rule, which will become effective April 1, 2020, clarifies and increases transparency by describing the combination of factors that would and would not trigger control concerns. A chart illustrating how different combinations of factors would or would not raise control concerns accompanied the Board's press release.

01/31/2020

OFAC designations and updates

OFAC has posted an SDN List Update adding one individual and updating an entity listing, both designated under the non-proliferation and Iran-related sanctions programs. For identification details see BankersOnline's OFAC Update

01/31/2020

USCIS notice of revised I-9 form

U.S. Citizenship and Immigration Services has published [85 FR 5683] a notice announcing a new version of Form I-9, Employment Eligibility Verification. Employers must use Form I-9 to verify the identity and employment authorization of their employees. USCIS made minor changes to the form and its instructions.

Form I-9, Employment Eligibility Verification, with a version date of “(Rev. 10/21/2019)” is available for use beginning January 31, 2020. The prior version of Form I-9 (Rev. 07/17/2017 N) will be obsolete effective April 30, 2020. Employers do not need to complete the new Form I-9 (Rev. 10/21/2019) for current employees who already have a properly completed Form I-9 on file, unless reverification applies.

As of this morning (7:50 a.m., ET, 1/31/2020), USCIS had not yet posted the new version of the Form I-9 on its I-9, Employment Eligibility Verification page.

01/30/2020

Otting testifies at House hearing

Comptroller of the Currency Joseph M. Otting testified yesterday during a hearing held by the House Financial Services Committee. He made an oral statement and presented written testimony discussing efforts to strengthen and modernize Community Reinvestment Act regulations, the condition of the federal banking system, the agency’s diversity and inclusion programs, and work to implement regulatory reform that encourages economic opportunity while ensuring banks operate in a safe, sound, and fair manner.

01/30/2020

OFAC targets Russian aggression toward Ukraine

Treasury has announced OFAC's designation of eight individuals and one entity in response to Russia’s continued aggression toward Ukraine and attempted occupation of Crimea. Seven of these individuals were also designated yesterday by the European Union (EU). In addition to the United States, Canada designated these same individuals today as part of a coordinated action in a strong demonstration of the international community’s continued condemnation of Russia’s interference in Crimean politics. Additionally, OFAC designated one individual and one entity providing rail services in support of Russia’s efforts to deepen the economic integration of Russia and Crimea.

Identifying information on the individuals and entity designated by OFAC can be found in BankersOnline's OFAC Update.

01/29/2020

OCC workshops in DC

The OCC reports it will host two workshops at OCC Headquarters in Washington, D.C., March 17 and 18, for directors of national community banks and federal savings associations.

  • The Risk Governance workshop on March 17 provides practical information for directors to effectively measure and manage risks. The workshop also focuses on the OCC’s approach to risk-based supervision and major risks in the financial industry.
  • The Compliance Risk workshop on March 18 focuses on the critical elements of an effective compliance risk management program, and on major compliance risks and critical regulations. Topics of discussion include the Bank Secrecy Act, Flood Disaster Protection Act, Fair Lending, Home Mortgage Disclosure Act, Community Reinvestment Act, and other compliance hot topics.

Each workshop is limited to the first 35 registrants, and there is a $99 fee. Online registration is available.

01/28/2020

IRS guidance on reporting mortgage insurance on Form 1098

The Internal Revenue Service has issued new guidance involving the deductibility of mortgage insurance premiums (MIP) for tax years 2018 through 2020. Recipients of mortgage payments who report mortgage interest payments on Form 1098 should also report MIP aggregating $600 or more received during the calendar year.

Lenders are not required to file or furnish corrected Forms 1098 for 2018 to report MIP for that year. However, the IRS encourages them to make that information available to borrowers so that they can decide whether to amend their 2018 income tax returns to claim the additional deduction. The IRS strongly recommends that lenders file corrected Forms 1098 for 2018 to report the MIP, as this will help substantiate the deductions and avoid IRS inquiries about any deduction that does not match the information return filed with the IRS.

For tax year 2019, Forms 1098 should be filed and furnished according to the usual due dates and include MIP in box 5. If a lender has already furnished the borrower statement without reporting MIP, it should send a corrected statement. Requests for extensions to file or furnish Forms 1098 should be submitted according to the specifications in the General Instructions for Certain Information Returns.

For tax year 2020, lenders should report MIP in box 5 and file and furnish Forms 1098 according to the specifications in the Instructions for Form 1098 and the General Instructions for Certain Information Returns

01/28/2020

Shipping company pays $1.125M to settle OFAC violations

OFAC has announced that Eagle Shipping International (USA) LLC, a Marshall Islands company with its headquarters in Stamford, Connecticut, has agreed to pay $1,125,000 to settle its potential civil liability for 36 apparent violations of the Burmese Sanctions Regulations. The alleged violations involve Eagle Shipping’s dealings in the property interests of Myawaddy Trading Limited, which at all relevant times was identified on OFAC’s SDN list, and the provision of transportation services from Burma to Singapore for a land reclamation project for the benefit of Myawaddy, in apparent violation of the regulations.

01/27/2020

CFPB clarifies stance on 'abusiveness' standard

The Consumer Financial Protection Bureau issued a policy statement Friday providing a common-sense framework on how it intends to apply the "abusiveness" standard in supervision and enforcement matters. Commencing immediately, the Bureau intends to apply the following principles during supervision and enforcement work by:

  • Focusing on citing or challenging conduct as abusive in supervision and enforcement matters only when the harm to consumers outweighs the benefit
  • Generally avoiding "dual pleading" of abusiveness and unfairness or deception violations arising from all or nearly all the same facts, and alleging "stand alone" abusiveness violations that demonstrate clearly the nexus between cited facts and the Bureau’s legal analysis
  • Seeking monetary relief for abusiveness only when there has been a lack of a good-faith effort to comply with the law, except the Bureau will continue to seek restitution for injured consumers regardless of whether a company acted in good faith or bad faith

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