Top Story Compliance Related

Two new Frequently Asked Questions (FAQs) relating to U.S. Ukraine-/Russia-related sanctions have been published by OFAC to provide guidance on (i) U.S. persons' ability to receive payments of principal and interest from blocked persons for a preexisting loan or bond, and (ii) the sanctions implications for a foreign company paying dividends to a blocked person who is a minority shareholder.

Banking attorney Jelena McWilliams' nomination as Chairman of the Federal Deposit Insurance Corporation has been confirmed. She was most recently chief legal officer at Fifth Third, previously served as a Senate GOP aide and an attorney at the Federal Reserve Board. Comptroller of the Currency Otting issued a statement congratulating McWilliams on yesterday's confirmation by the Senate.

Federal credit union members could have more options for short-term, small-dollar borrowing under a rule proposed by the National Credit Union Administration Board. The proposed rule would create one new product in addition to the current payday loan alternative that has been available to federally chartered credit unions since 2010. The Board also is requesting credit union stakeholders to comment on a possible third option.

UPDATE: Published 6/4/18, with 60-day comment period ending 8/3/18.

The OCC has issued its Semiannual Risk Perspective for Spring 2018. Highlights include:

• Competition for quality loans is strong, as examiners note evidence of eased underwriting. The accommodating credit environment warrants a continued focus on underwriting practices to monitor and assess credit risk and lender complacency.
• Operational risk is elevated as banks adapt business models, transform technology and operating processes, and respond to evolving cyber threats.
• Compliance risk is elevated as banks manage money laundering risks and implement changes to policies and procedures to comply with amended Bank Secrecy Act and consumer protection requirements.
• The continued increase in market interest rates may eventually lead to higher funding costs for banks, as economic growth increases loan demand and competition for funding pressures banks to raise deposit yields.

The NMLS 2017 Annual Mortgage Industry Report is now available on the organization's Reports page, along with forth quarter 2017 Money Services Businesses Fact Sheet, Debt Collection Fact Sheet, and Mortgage Update. The Money Services Businesses and Debt Collection fact sheets report the states for which NMLS manages licenses, and the numbers of such licenses recorded with NMLS.

OFAC has designated as specially designated global terrorists nine individuals and entities procuring export-controlled, U.S.-origin goods for sanctioned Iranian airlines. They were designated pursuant to Executive Order 13224, which targets terrorists and those providing support to terrorists or acts of terrorism. OFAC also identified 31 aircraft in which entities previously designated under E.O. 13224 have an interest. See our OFAC Page for identification information.

HUD has announced it is charging Syracuse, New York, property owners Nolo Contendere LLC and Nolo Contendere LLC Trust and their agents with housing discrimination for allegedly refusing to allow a woman with mental disabilities to keep an assistance animal. The Fair Housing Act prohibits housing providers from denying or limiting housing to persons with disabilities or from refusing to make reasonable accommodations in policies or practices. This includes denying a request for an assistance animal.

Treasury and the IRS have issued a joint notice they will issue proposed regulations in the near future addressing legislation adopted or being considered by state legislatures that allow taxpayers to receive a credit against their state and local taxes for contributions to certain organizations or funds designated by the state. In addition to cutting income tax rates, expanding the child tax credit, and nearly doubling the standard deduction, the Tax Cuts and Jobs Act limited the amount of state and local taxes an individual can deduct in a calendar year to $10,000.

• Press release

An article in the May 2018 edition of the OCC's Community Development Investments newsletter reviews how minority depository institution (MDI) collaborations with large and midsize banks can be profitable for the parties involved and help MDIs fulfill their missions and serve customers in a rapidly evolving industry.

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has designated five Iranian individuals who have provided ballistic missile-related technical expertise to Yemen’s Huthi terrorists, and who have transferred weapons not seen in Yemen prior to the current conflict, on behalf of the Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF). For identification information on the five targeted individuals, see our OFAC Update.

As a result of these actions, all property and interests in property of those designated today subject to U.S. jurisdiction are blocked, and U.S. persons are generally prohibited from engaging in transactions with them. In addition, foreign financial institutions that knowingly facilitate significant transactions for, or persons that provide material or certain other support to, the individuals and entities designated today risk exposure to sanctions that could sever their access to the U.S. financial system or block their property and interests in property under U.S. jurisdiction.