Skip to content

Exception Tracking Spreadsheet (TicklerTrax™)
Downloaded by more than 1,000 bankers. Free Excel spreadsheet to help you track missing and expiring documents for credit and loans, deposits, trusts, and more. Visualize your exception data in interactive charts and graphs. Provided by bank technology vendor, AccuSystems. Download TicklerTrax for free.

Click Now!


Top Story Compliance Related

11/01/2021

California based Ponzi scheme managers charged

The Securities and Exchange Commission has announced that it has charged BNZ, a Newport Beach, California-based company, and its co-founders and co-managers Brett Barber and Louis Zimmerle, for fraudulently raising $13.5 million from more than 100 retail investors.

According to the SEC's complaint, filed on October 28, 2021, since June 2019, BNZ, Barber, and Zimmerle have raised $13.5 million from retail investors by telling them BNZ was in the business of making investments in real estate and alternative investments and promising to pay investors significant returns, generally 10% per year. The complaint alleges that the defendants used only $6.4 million of the $13.5 million raised from investors to invest in real estate and alternative investments, and those investments generated just $300,000 in profits.

Despite generating minimal profits, the defendants allegedly paid investors returns of at least $1.7 million using funds raised from other investors in Ponzi-like fashion, and transferred over $1.6 million to Barber through his company, Guaranteed Income Solutions Inc., and over $700,000 to Zimmerle. The defendants are alleged to have made false and misleading statements to investors regarding, among other things, the source of the payment of the investor returns. In addition, Barber allegedly misled investors by touting his education in finance and his investment experience without also disclosing that he had been barred by the Financial Industry Regulatory Authority from affiliating with any member firm.

11/01/2021

Fixed Income Clearing Corporation charged by SEC

The Securities and Exchange Commission has announced that Fixed Income Clearing Corporation (FICC), a clearing agency, has agreed to pay an $8 million penalty to settle SEC charges that it failed to have adequate risk management policies within its Government Securities Division.

According to the SEC’s order, FICC acts as the sole registered clearing agency for transactions in U.S. government securities. FICC substitutes itself for both sides of every transaction that it clears, guaranteeing those transactions and making itself the buyer for every seller and the seller for every buyer. A failure by FICC to manage risk could result in significant costs not only to FICC and its participants, but also to other market participants or the broader U.S. financial system.

The SEC’s order finds that FICC, a wholly-owned subsidiary of The Depository Trust & Clearing Corporation, violated the Covered Clearing Agency Standards promulgated by the SEC under the Securities Exchange Act of 1934. Without admitting or denying the SEC’s findings, FICC agreed to a censure and the $8 million penalty, as well as to cease and desist from future violations of the charged provisions. FICC also agreed to retain an independent compliance consultant to assess its compliance efforts.

11/01/2021

FinCEN renews geographic targeting orders

FinCEN has announced the renewal of its Geographic Targeting Orders (GTOs) that require U.S. title insurance companies to identify the natural persons behind shell companies used in all-cash purchases of residential real estate. The purchase amount threshold remains $300,000 for each covered metropolitan area. The terms of the order are effective beginning November 1, 2021, and ending on April 29, 2022. FinCEN said that GTOs continue to provide valuable data on the purchase of residential real estate by persons possibly involved in various illicit enterprises. Renewing the GTOs will further assist in tracking illicit funds and other criminal or illicit activity, as well as inform FinCEN’s future regulatory efforts in this sector.

The GTOs cover certain counties within these major U.S. metropolitan areas: Boston; Chicago; Dallas-Fort Worth; Honolulu; Las Vegas; Los Angeles; Miami; New York City; San Antonio; San Diego; San Francisco; and Seattle. The orders do not apply to banks or credit unions.

Related links:

Generic sample of GTOs

11/01/2021

FDIC September enforcement actions announced

The FDIC has released a list of enforcement actions taken in September 2021.

  • Farmers and Merchants Bank, Milford, Nebraska, was ordered to pay a civil money penalty of $24,000 for violations of flood insurance regulations.
  • Liberty Bank, Inc., Salt Lake City, Utah, was issued a consent cease and desist order after the FDIC found the bank in violation of the Truth in Lending Act, the Real Estate Settlement Procedures Act, the Electronic Signatures Act, the Equal Credit Opportunity Act, the Community Reinvestment Act, and the Truth in Savings Act, and their respective implementing regulations.

11/01/2021

U.S. sanctions network and individuals aiding Iranian program

On Friday, OFAC designated members of a network of companies and individuals that have provided critical support to the Unmanned Aerial Vehicle (UAV) programs of Iran’s Islamic Revolutionary Guard Corps (IRGC) and its expeditionary unit, the IRGC Qods Force (IRGC-QF). OFAC also designated Saeed Aghajani, the commander of the IRGC Aerospace Force (IRGC ASF) UAV Command.

Friday's actions were taken pursuant to the counterterrorism authority Executive Order 13224, as amended, as well as E.O. 13382, which targets weapons of mass destruction proliferators and their supporters.

For identity information on the individuals and entities that OFAC designated on Friday, see BankersOnline's October 29, 2021 OFAC Update

10/29/2021

Revised booklet for Comptroller's Handbook

The Office of the Comptroller of the Currency has issued Bulletin 2021-52 to announce publication of version 2.0 of the “Retail Lending” booklet of the Comptroller’s Handbook. This booklet discusses risks associated with retail lending and provides a framework for examiners’ evaluations of risk management activities.

The revised booklet—

  • reflects changes to laws and regulations since this booklet was last updated.
  • reflects OCC issuances published and rescinded since this booklet was last updated.
  • includes clarifying edits regarding supervisory guidance, sound risk management practices, and legal language.
  • revises certain content for general clarity.

10/29/2021

OFAC targets three Lebanese nationals

On Thursday, Treasury announced that OFAC had designated two Lebanese businessmen and a member of Parliament whose actions have contributed to the breakdown of good governance and the rule of law in Lebanon. Jihad al-Arab, Dany Khoury, and Jamil Sayyed have each personally profited from the pervasive corruption and cronyism in Lebanon, enriching themselves at the expense of the Lebanese people and state institutions. These individuals, who are members of Lebanon’s business and political elite, are being designated pursuant to Executive Order 13441, which targets persons contributing to the breakdown of the rule of law in Lebanon.

Identification details can be found in BankersOnline's October 28, 2021, OFAC Update.

10/28/2021

Updated Reg Z exam procedures

The Federal Reserve Board has issued a Community Affairs Letter announcing the Task Force on Consumer Compliance of the Federal Financial Institutions Examination Council recently developed updated interagency examination procedures for Regulation Z – Truth in Lending (TILA).

The revised procedures reflect amendments to Regulation Z published by the Consumer Financial Protection Bureau in 2020 and 2021: (1) implementing permanent changes to Regulation Z's qualified mortgage provisions, and (2) implementing an extension and phase-out for the GSE Patch, which had originally carried a January 10, 2021, sunset date under the Ability to Repay/Qualified Mortgage rule and which will now sunset on October 1, 2022.

10/27/2021

OCC takes enforcement action against mortgage subservicer

The OCC on Tuesday announced it had issued a Consent Cease and Desist Order against Cenlar FSB (Ewing, NJ), the largest mortgage sub-servicer in the country, performing servicing duties on behalf of financial institution clients throughout the United States, and the second largest mortgage servicer in the United States.

The OCC's action was based on the bank’s failure to establish effective controls and risk management practices related to its mortgage servicing and subservicing activities. The order requires the bank to take comprehensive corrective actions to address identified deficiencies and implement internal controls and risk management practices that are appropriate to the bank’s risk profile and the size of its mortgage subservicing operations.

The order also limits excessive growth and prioritizes remediation by requiring the bank to receive no supervisory objection from the OCC before adding new subservicing clients and prior to declaring or paying dividends to shareholders while the order is effective.

10/27/2021

FTC warns businesses about deceptive money-making claims

The Federal Trade Commission has announced that this week, the Commission put more than 1,100 businesses that pitch money-making ventures on notice that if they deceive or mislead consumers about potential earnings, the FTC won’t hesitate to use its authority to target them with large civil penalties.

The FTC is deploying its Penalty Offense Authority to remind businesses of the law and deter them from breaking it. By sending a Notice of Penalty Offenses to the companies, the agency is placing them on notice they could incur significant civil penalties—up to $43,792 per violation—if they or their representatives make claims about money-making opportunities that run counter to prior FTC administrative cases. The Notice of Penalty Offenses allows the agency to seek civil penalties against a company that engages in conduct that it knows is unlawful, and that has been found unlawful in a previous FTC administrative order, other than a consent order.

Companies receiving the Notice also received a copy of the recently issued Notice of Penalty Offenses concerning endorsements and testimonials [see "FTC warns advertisers: honest opinions only"], as companies frequently use testimonials to advertise money-making opportunities. Together, the notices make clear that it is illegal to use testimonials to mislead consumers about the rewards of participating in a money-making opportunity.

Related link

Pages

Training View All

Penalties View All

Search Top Stories