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Top Story Compliance Related


FDIC lists enforcement actions

The FDIC has released a a list of orders of administrative enforcement actions taken against banks and individuals in December.

  • The Bancorp Bank, Wilmington, Delaware, was ordered to pay a $7.5 million civil money penalty for BSA/AML violations
  • A former market president and director of Frontier Bank, Omaha, Nebraska, was assessed a civil money penalty of $25,000 and issued a prohibition order for making loans to uncreditworthy borrowers, diverting funds loaned to one customer to the use of another bank customer, and extending credit in excess of his authority.
  • a former branch president and loan officer of People's Bank and Trust Company, McPherson, Kansas, was issued a cease and desist order after the FDIC determined she manipulated payment due dates on loans and overdraft lines to herself and immediate family members, concealing delinquencies from senior management of the bank.


Bureau sues Citizens Bank, N.A.

The CFPB has announced it has filed a complaint against Citizens Bank, N.A. (Citizens), headquartered in Providence, Rhode Island. The Bureau’s complaint alleges violations of the Truth in Lending Act and its implementing Regulation Z, including violations of amendments to TILA contained in the Fair Credit Billing Act and the Credit Card Accountability Responsibility and Disclosure (CARD) Act.

The complaint alleges that Citizens automatically denied consumers’ billing error notices and claims of unauthorized use in certain circumstances. The complaint further alleges that Citizens failed to fully refund finance charges and fees when consumers asserted meritorious disputes or fraud claims, and failed to send consumers required acknowledgment letters and denial notices in response to billing error notices. It also alleges that Citizens failed to provide credit counseling referrals to consumers who called Citizens’ toll-free number designated for that purpose.

The complaint is not a finding or ruling that the defendant has violated the law.


Agencies propose modifications of Volcker Rule

A joint press release from the Federal Reserve Board, FDIC, OCC, SEC, and the Commodity Futures Trading Commission announces the agencies are inviting public comment on a proposal to modify regulations implementing the Volcker Rule's general prohibition on banking entities investing in or sponsoring hedge funds or private equity funds—known as "covered funds." The proposal would modify the restrictions for banking entities investing in, sponsoring, or having certain relationships with covered funds. Comments will be accepted through April 1, 2020.

UPDATE: Published at 85 FR 12120 ( on 2/28/2020, with 33-day comment period ending 4/1/2020.

UPDATE: The agencies have announced an extension of the comment period to 5/1/2020.


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.


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.
UPDATE: Published at 85 FR 12398 on March 1, 2020, with an April 1, 2020, effective date.
UPDATE: On 3/31/2020, the Board announced it will postpone the effective date to September 30, 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


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.


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.


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.


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.


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