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Top Story Compliance Related

07/15/2020

Another "Outstanding" CRA rating released

Our review of the Federal Reserve Board's publication of CRA evaluation ratings in June revealed that eleven evaluations were made public, with ten banks garnering Satisfactory ratings. Our congratulations to Goldman Sachs Bank USA, New York, for its Outstanding rating.

07/14/2020

Student-loan debt-relief operator and attorneys sued by CFPB

The Consumer Financial Protection Bureau yesterday filed a complaint in the U.S. District Court for the Central District of California against GST Factoring, Inc., which runs a student-loan debt-relief business in Texas, and two of its owners, Rick Graff and Gregory Trimarche, as well as Champion Marketing Solutions, LLC, a customer service and marketing company, and its owner, Scott Freda. The Bureau also filed suit against four attorneys, California attorneys Amanda Johanson and Jacob Slaughter, Arizona attorney David Mize, and Florida attorney Daniel Ruggiero. The Bureau alleges that the companies, their owners, and the attorneys were part of a nationwide student-loan debt-relief operation that charged thousands of consumers saddled with private student-loan debt approximately $11.8 million in illegal upfront fees in violation of the Telemarketing Sales Rule. Concurrent with the complaint, the Bureau and four of the defendants filed proposed stipulated final judgments and orders to resolve the claims against them. If entered by the court, the orders will ban Trimarche, Slaughter, Mize, and Ruggiero from participating in certain activities, impose monetary judgments to provide consumer redress totaling approximately $11.8 million, and impose a civil money penalty.

07/14/2020

SEC charges app developer

The SEC reportedyesterday it had charged California-based Abra and a related firm in the Philippines for offering and selling security-based swaps to retail investors without registration and for failing to transact those swaps on a registered national exchange. According to the SEC’s order, Abra developed and owns an app that enabled users to bet on price movements of U.S.-listed equity securities. Using the app, individuals were able to enter into contracts that provide synthetic exposure to price movements of stocks and exchange-traded fund (ETF) shares trading in the U.S. through blockchain-based financial transactions with Abra or with related company Plutus Technologies Philippines Corp.

The order finds that Abra told users they could choose securities whose performance they wanted to mirror, and the value of their contract would go up or down the same amount as the price of the underlying security. The order further finds that these contracts were security-based swaps subject to U.S. securities laws.

As part of the settlement included in the order, Abra and Plutus agreed to cease and desist, and to jointly and severally pay a civil money penalty of $150,000.

07/13/2020

FATF Business Bulletin issued

The latest edition of the FATF Business Bulletin provides a summary of the decisions taken during the June 2020 Virtual Plenary and presents the objectives of the new FATF President, Marcus Pleyer, for the first two-year Plenary period.

07/13/2020

Amendments to SEC Form 13F proposed

The Securities and Exchange Commission has announced it has proposed to amend Form 13F to update the reporting threshold for institutional investment managers and make other targeted changes. The threshold has not been adjusted since the Commission adopted Form 13F over 40 years ago.

Form 13F was adopted to comply with a 1975 statutory directive designed to provide the Commission with data from larger managers about their investment activities and holdings, so that their influence and impact could be considered in maintaining fair and orderly securities markets.

Comments on the proposal will be accepted for 60 days following its publication in the Federal Register.

07/13/2020

Second quarter 2020 Call Report instructions

FDIC FIL-69-2020, distributed Friday, July 10, included links to supplemental instructions and June 2020 COVID-19- related supplemental instructions to the Consolidated Reports of Condition and Income (Call Report) for the June 30, 2020, report date.

Filers are asked to plan to complete as early as possible the preparation, editing, and review of their institution’s Call Report data and the submission of these data to the agencies’ Central Data Repository (CDR). Starting preparation early will help identify and resolve any edit exceptions before the submission deadline. If later they find that certain information needs to be revised, they should make the appropriate changes to the Call Report data and promptly submit the revised data file to the CDR.

07/10/2020

$1M in refunds mailed to victims of student loan scam

The Federal Trade Commission reports it is mailing checks totaling more than $1 million to individuals who lost money to a student loan debt relief scam. American Student Loan Consolidators and BBND Marketing, which did business under other names including United Processing Center, settled FTC allegations that the companies’ operators pretended to be affiliated with the U.S. Department of Education or with loan servicers to trick consumers into paying hundreds of dollars in illegal upfront fees for help with their student loans. The FTC alleged that the defendants falsely promised to forgive student loans, lower monthly payments, and reduce interest rates. The FTC is mailing 41,048 checks to victims of the scam.

07/10/2020

Chinese entity and officials sanctioned

The Treasury Department has announced that OFAC has sanctioned one Chinese government entity and four current or former government officials in connection with serious rights abuses against ethnic minorities in the Xinjiang Uyghur Autonomous Region (XUAR). The entity and officials are being designated for their connection to serious human rights abuse against ethnic minorities in Xinjiang, which reportedly include mass arbitrary detention and severe physical abuse, among other serious abuses targeting Uyghurs, a Turkic Muslim population indigenous to Xinjiang, and other ethnic minorities in the region. These designations are the latest U.S. government actions in an ongoing effort to deter human rights abuses in the Xinjiang region.

For identification of the designated entity and individuals, see BankersOnline's OFAC Update.

07/09/2020

Amazon settles with OFAC

OFAC has announced a $134,523 settlement with Amazon.co​m, Inc. to settle Amazon's potential civil liability for apparent violations of multiple OFAC sanctions programs.

As a result of deficiencies related to Amazon’s sanctions screening processes, Amazon provided goods and services to persons sanctioned by OFAC; to persons located in the sanctioned region or countries of Crimea, Iran, and Syria; and to individuals located in or employed by the foreign missions of countries sanctioned by OFAC. Amazon also failed to timely report several hundred transactions conducted pursuant to a general license issued by OFAC that included a mandatory reporting requirement, thereby nullifying that authorization with respect to those transactions. The settlement amount reflects OFAC’s determination that Amazon’s apparent violations were non-egregious and voluntarily self-disclosed, and further reflects the significant remedial measures implemented by Amazon upon discovery of the apparent violations.​​

07/08/2020

FATF report on stablecoins

At the request of the G20, the FATF has issued a "Report on So-Called Stablecoins" that sets out the FATF’s views on stablecoins and addresses:

  • the characteristics of stablecoins
  • the money laundering and terrorist financing risks of stablecoins
  • how the FATF Standards apply to stablecoins and the different businesses involved in the stablecoin; and
  • how the FATF plans to enhance the global anti-money laundering and counter-terrorism financing framework for virtual assets and stablecoins.

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