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Top Story Compliance Related

02/28/2020

Wells Fargo settles with SEC

The SEC has announced it has settled charges against Wells Fargo Clearing Services and Wells Fargo Advisors Financial Network for failing to reasonably supervise investment advisers and registered representatives who recommended single-inverse ETF (exchange-traded fund) investments to retail investors, and for lacking adequate compliance policies and procedures with respect to the suitability of those recommendations. The SEC ordered Wells Fargo to pay a $35 million penalty, which will be distributed to harmed investors.

02/28/2020

OCC schedules workshops in Charleston WV

The OCC has announced it will host two workshops at the Holiday Inn & Suites in Charleston, West Virginia, April 14 and 15, for directors of national community banks and federal savings associations supervised by the OCC.

  • The Risk Governance workshop on April 14 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 Credit Risk workshop on April 15 focuses on credit risk within the loan portfolio, such as identifying trends and recognizing problems. The workshop also covers the roles of the board and management, how to stay informed of changes in credit risk, and how to effect change.

There is a fee of $99 for each workshop and each session is limited to the first 35 registrants.

02/28/2020

Property owner charged for requiring fees for service animal

A New York property owner has been charged by HUD with illegal discrimination for denying the reasonable accommodation request of a resident with mental disabilities. HUD's charge further alleges that the owner attempted to charge the resident extra fees for having an assistance animal, made threats to intimidate and deter her from exercising her fair housing rights, and eventually evicted her. The Fair Housing Act makes it unlawful to refuse to make reasonable accommodations in rules, policies, practices, or services, when such accommodation may be necessary to afford a person with disabilities equal opportunity to use and enjoy a dwelling. The Act also prohibits housing providers from threatening and coercing persons who seek to exercise their fair housing rights.

02/28/2020

Housing providers pay $10,000 to settle with HUD

HUD has announced it has approved a Conciliation Agreement between Oberhauser Trust, in Escondido, and its leasing agent, First Core Group, Inc. doing business as Keller Williams Realty, in Glendale, California, settling claims that the leasing agent allegedly denied a father of two children the opportunity to rent a condominium. The case came to HUD's attention after a father of two and his father-in-law filed a complaint alleging that the father was denied the opportunity to rent a condominium because he has two young daughters who would be living with him part-time. The father alleged that the leasing agent refused to consider his application for the unit, saying, "I don't want to waste your time or mine. Sorry."

The owner and leasing company deny that they discriminated against the family but agreed to settle the complaint. Under the terms of the agreement, the owners and brokerage agency will pay $10,000 to the father and will revise their fair housing policy to contain provisions that there are no preferences against renting or selling properties to families with children. In addition, representatives of the owners and their leasing agents will attend fair housing training.

02/28/2020

Defense revises Military Lending Act interpretive rule

The Department of Defense has published [85 FR 11842] in this morning's Federal Register an amendment to its interpretive rule for the Military Lending Act (the MLA). The Department is withdrawing the amended question and answer number 2, published in its December 14, 2017, Interpretive Rule, which discussed when credit is extended for the purpose of purchasing a motor vehicle or personal property and the creditor simultaneously extends credit in an amount greater than the purchase price of the motor vehicle or personal property. In withdrawing this amended question and answer, the Department is reverting back to the original Q&A #2 published in the August 26, 2016 Interpretive Rule. This will allow the Department to conduct additional analysis on this matter. The Department is also adding a new question and answer to address questions about the use of Individual Taxpayer Identification Numbers to identify covered borrowers in the Department's database.

The amendments are effective February 28, 2020. They have been posted to the BankersOnline Regulations page for the Interpretive Rule.

02/27/2020

CFPB adds ten TRID FAQs on lender credits

The Consumer Financial Protection Bureau has added ten new questions and answers to its TILA-RESPA Integrated Disclosure FAQs page. The questions addressed include—

  1. What is a lender credit for purposes of the TRID Rule?
  2. What is the difference between a specific lender credit and a general lender credit?
  3. Is a creditor required to disclose a closing cost and a related lender credit on the Loan Estimate if the creditor will absorb the cost?
  4. Is a creditor required to disclose a closing cost and a related lender credit on the Closing Disclosure if the creditor will absorb the cost?
  5. How are lender credits disclosed on the Loan Estimate?
  6. How are lender credits disclosed on the Closing Disclosure?
  7. How does a creditor disclose lender credits for a loan the the creditor refers to as a "no-cost loan"?
  8. How does a creditor disclose lender credits if the creditor provides a credit, rebate, or reimbursement to offset specific closing costs charged to the consumer?
  9. How does a creditor disclose lender credits when it is offsetting a certain dollar amount of closing costs charge to the consumer without specifying which costs it is offsetting?
  10. Can lender credits change?

02/27/2020

OFAC makes Specially Designated Global Terrorist designations

The Treasury Department announced yesterday that OFAC has designated as specially designated global terrorists (SDGTs) three Lebanon-based officials and 12 Lebanon-based entities linked to the Martyrs Foundation, part of Hizballah’s support network. For identification information, see this BankersOnline OFAC Update.

OFAC also designated an Iraqi national as a specially designated global terrorist. See this BankersOnline OFAC Update for identification information.

02/27/2020

OFAC posts two new FAQs on reporting procedures

OFAC has posted a notice it has published two new FAQs related to the June 21, 2019, amendment to OFAC's Reporting, Procedures and Penalties Regulations (31 CFR part 501).

02/26/2020

Debt collection scheme operator banned

The Federal Trade Commission has announced that the operator of a debt collection scheme has settled claims by the Commission and the New York Attorney General that he and the companies he controlled lied to consumers about how much debt they owed and used illegal scare tactics to collect it.

Under the settlement, Robert Heidenreich, who ran the scheme from the Buffalo, N.Y. area, is permanently banned from the debt collection business and prohibited from misleading consumers about any financial products. The settlement also includes a monetary judgment of $1.7 million, which is partially suspended due to Heidenreich’s inability to pay. He will be required to surrender $30,000 to the FTC, and if he were later found to have misrepresented his financial condition, the full judgment would be due.

02/26/2020

FTC 2019 privacy and data security update

The Federal Trade Commission has released its 2019 annual privacy and data security update, which highlights a record year for enforcement actions aimed at protecting consumer privacy and data security. The Commission levied a $5 billion penalty -- the largest consumer privacy penalty ever -- against Facebook for violating its 2012 FTC privacy order and imposed new restrictions on the social network’s business operations. The FTC also obtained a record $170 million penalty against YouTube and Google for alleged violations of the Children’s Online Privacy Protection Act (COPPA).

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