Top Story Compliance Related

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) took action Thursday to disrupt an Islamic State of Iraq and Syria (ISIS) financial facilitation network by designating one individual and one entity pursuant to Executive Order 13224, which targets terrorists and those providing support to terrorists or acts of terrorism. Specifically, OFAC designated Umar al-Kubaysi and his company, Al-Kawthar Money Exchange, building upon OFAC’s December 2016 actions, which marked the first designations of ISIS-linked money services businesses. As a result of this action, 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.

Additionally, the Department of State designated ISIS members Mohammad Shafi Armar, Oussama Ahmad Atar, and Mohammed Isa Yousif Saqar Al Binali.

OFAC has added all four individuals and the money exchange to its SDN List. For ID information, see our OFAC Update.

The Consumer Financial Protection Bureau announced on Thursday it is proposing updates to its prepaid rule, which was issued in 2016, and is, after an earlier change, scheduled to become effective April 1, 2018. The proposal would adjust requirements for resolving errors on unregistered accounts and provide greater flexibility for credit cards linked to digital wallets. Under the first change, consumers would need to register their accounts to receive full fraud and error protection benefits such as the right to dispute charges and have stolen money restored. The proposal would require companies to provide these protections to registered accounts even if the theft or dispute occurred before registration was successfully completed.

The proposal affecting digital wallets would ensure that consumers continue to receive full CARD Act protections on their traditional credit card accounts while making it easier for them to link those accounts to their digital wallet prepaid accounts. The Bureau is also proposing additional minor adjustments and clarifications to aspects of the prepaid rule that industry members have expressed concerns about. Comments on the proposal will be accepted for 45 days following Federal Register publication.

UPDATE: Published in Federal Register on June 29, 2017. Comments due by August 14, 2017.

The Bureau also released an updated version of its small entity compliance guide for the rule, reflecting the April 1, 2018, effective date and clarifications on several issues for which the industry has raised questions or asked for added clarity.

• Bureau's proposal

The CFPB has posted an articlelisting five principles for effective adult financial education:

• Know the individuals and families receiving services
• Provide actionable, relevant, and timely information
• Improve key financial skills
• Build on motivation
• Make it easy to make good decisions and follow-through

The Office of Foreign Assets Control has posted an SDN List Update identifying 29 listings of individuals and entities that have been removed, and changes to the listings of one individual and one entity. See BOL's OFAC Update for details.

The National Credit Union Administration Board has rescheduled its June open and closed meetings. The June closed meeting will be held Wednesday, June 21, beginning at 3:30 p.m. Eastern time. The June open meeting will be held Friday, June 23, beginning at 10 a.m. Eastern time. The meeting agendas are available on the NCUA calendar.

The CFPB has posted two article on its Blog — one regarding summer money matters for young adults on their first job and the other on helping people plan for retirement.

In a statement before the Senate Budget Committee, Treasury Secretary Mnuchin stated his number-one priority is creating sustainable economic growth for all Americans. He also discussed tax reform and the importance of free and fair international trade. He noted, "This has been a significant few months at Treasury. We have been studying, developing, and implementing policies that will put this country on the path toward sustained economic growth. In the coming months, we will work with this Committee and the Congress in what we will look back on as an important time for this nation’s economy and in our history."

The Treasury Department today published a request for information inviting members of the public to submit views and recommendations for Treasury Department regulations that can be eliminated, modified, or streamlined in order to reduce burdens, in furtherance of the Regulatory Reform Agenda outlined in Executive Orders 13771 and 13777. Comments are due by July 31, 2017.

Treasury issued the first in a series of reports to President Trump examining the United States’ financial regulatory system and detailing executive actions and regulatory changes that can be immediately undertaken to provide much-needed relief. Over the past four months, Secretary Mnuchin and other Treasury officials met with hundreds of stakeholders across the financial ecosystem, including community, independent, regional and large banks, regulators, FSOC members, consumer advocates, academics, analysts and investors. These listening sessions provided a very clear picture of redundancy, fragmentation, and inefficiency in our regulatory framework. The report detailed the following findings:

• Community financial institutions – banks and credit unions – are critically important to serve many Americans
• Capital, liquidity and leverage rules can be simplified to increase the flow of credit
• We must ensure our banks are globally competitive
• Improving market liquidity is critical for the U.S. economy
• The Consumer Financial Protection Bureau must be reformed
• Regulations need to be better tailored, more efficient, and effective
• Congress should review the organization and mandates of the independent banking regulators to improve accountability.

The Financial Crimes Enforcement Network (FinCEN) has published in the June 13, 2017, Federal Register a Notice and Request for Comments on a proposed update and renewal of the collection of information through its "Designation of Exempt Person" (DoEP) report, used by banks and others to designate eligible customers as exempt from currency transaction reporting requirements. The proposed minor changes would remove the obsolete reference to "Document Control Number" and to add a country field in Parts II and III of the report to accommodate reporting from U.S. territories. Comments will be accepted for 62 days, through August 14, 2017.