Top Story Compliance Related

The Financial Industry Regulatory Authority (FINRA) has announced that a FINRA extended hearing panel barred broker Hank Mark Werner of Northport, New York, for fraudulently churning and excessively trading the accounts of his customer—a blind, elderly widow—and for making unsuitable recommendations. The hearing panel also ordered Werner to pay more than $155,000 in restitution to the widow, fined him $80,000 and ordered disgorgement of more than $10,000 representing commissions received for recommending the purchase of an unsuitable variable annuity.

The State of Oklahoma has filed an amicus curiae brief with the U.S. District Court for the District of Kansas, in support of the defendants in Consumer Financial Protection Bureau vs. Golden Valley Lending, Inc., at al, according to a report in Ballard Spahr, LLP's Consumer Finance Monitor. The Bureau's complaint against four online tribal lenders was filed in April in the Northern District of Illinois and subsequently transferred to the Kansas District. The suit claims that the lenders engaged in unfair, deceptive and abusive acts or practices in violation of the Consumer Financial Protection Act by attempting to collect loans that were void or uncollectible under state law due to interest rates exceeding state usury limits. The suit also alleges that the lenders failed to disclose the APR in advertisements and in response to telephone inquiries, in violation of the Truth in Lending Act.

Oklahoma's brief supports the lenders' claims that they are immune from suit under the CFPA and TILA as "arms of the tribe," that the Bureau can't enforce state law, and the loans are subject to tribal, rather than state, laws.

OFAC has published a final rule removing from the Code of Federal Regulations the Côte d'Ivoire Sanctions Regulations as a result of the termination of the national emergency on which the regulations were based. The effective date is November 13, 2017.

The CFPB has published in the Federal Register for Monday, November 13, 2017 (no Federal Register was published today), a notice that the Bureau is updating its list of companies that offer existing credit card customers free access to a credit score, and a request for responses from the industry to be used in publishing the updated list. Comments on the notice are due by January 12, 2018.

The Bureau also published a companion notice and request for information encouraging comments from the public to inform the Bureau on the experience consumers are having with access to free credit scores and the experience of companies, and nonprofits, offering their customers and the general public free access to their credit scores. Comments are due by February 12, 2018.

OCC Bulletin 2017-52, issued yesterday, announced the revision of the “Background Investigations” booklet of the Comptroller’s Licensing Manual. The revised booklet incorporates updated procedures and requirements following the integration of the functions of the Office of Thrift Supervision into the OCC in 2011, and the issuance of revised regulations that became effective July 1, 2015.

Yesterday, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) designated ten current or former Venezuelan government officials pursuant to Executive Order 13692. These individuals are associated with undermining electoral processes, media censorship, or corruption in government-administered food programs in Venezuela. For details on the designated individuals, see our OFAC Update.

OFAC also announced its publication of two new Venezuela-related FAQs. The first pertains to the treatment of Petroleos de Venezuela, S.A. (PdVSA) subsidiaries under Executive Order 13808 ("Imposing Additional Sanctions With Respect to the Situation in Venezuela"). The second deals with U.S. person participation in meetings about restructuring outstanding Venezuelan and PdVSA debt that existed prior to the effective date of Executive Order 13808.

The CFPB announced yesterday it has filed a complaint in federal court against Freedom Debt Relief, the nation’s largest debt-settlement services provider, and its co-CEO Andrew Housser, for deceiving consumers. The CFPB alleges that Freedom charges consumers without settling their debts as promised, makes customers negotiate their own settlements, misleads them about its fees and the reach of its services, and fails to inform them of their rights to funds they deposited with the company.

Update, 7/9/2019: The CFPB announced 7/9/2019 that it had settled its suit against Freedom Debt Relief. See our Top Story.

The FTC has charged a Georgia-based debt collection business with tricking people into paying more than $3.4M for debts they did not owe, and a federal court has granted the FTC request to freeze the company’s assets.

• FTC Complaint

The OCC has issued Bulletin 2017-51 as guidance to provide transparency regarding its framework for evaluating certain types of licensing applications when an applicant bank has an overall Community Reinvestment Act (CRA) rating of “Needs to Improve” or “Substantial Noncompliance” or a less than satisfactory CRA rating in one or more geographic rating areas.

In remarks before The Clearing House Annual Conference in New York City, Acting Comptroller of the Currency Keith A. Noreika explored how the separation of banking and commerce evolved in the United States and called for a broader discussion of whether the separation continues to serve the best interest of the nation’s banking system and economy today.