Top Story Compliance Related

The Office of the Comptroller of the Currency has published a final rule and guidelines establishing standards for recovery planning by insured national banks, insured Federal savings associations, and insured Federal branches of foreign banks with average total consolidated assets of $50 billion or more (Final Guidelines). The OCC is issuing the Final Guidelines as an appendix to its safety and soundness standards regulations, and the Final Guidelines will be enforceable by the terms of the Federal statute that authorizes the OCC to prescribe operational and managerial standards for national banks and Federal savings associations. The guidelines become effective January 1, 2017, with phased-in compliance dates over 18 months from that date, with the largest banks (total assets of $750 billion or more) required to comply by July 1, 2017.

• Final Rule and Guidelines (81 FR 66791)

The Federal Emergency Management Agency (FEMA) has published a final rule in this morning's Federal Register identifying unincorporated areas of Louisa County, Virginia, as a community where the sale of flood insurance has been authorized under the National Flood Insurance Program (NFIP) that is scheduled for suspension on October 31, 2016, for noncompliance with the floodplain management requirements of the program.

The Office of Foreign Assets Control has sanctioned two individuals following increasing indications that the Government of the Democratic Republic of the Congo (DRC) continues to suppress political opposition in the country, often through violent means. OFAC also added a Moroccan operating in Syria as a specially designated global terrorist. All of the designated individuals’ assets within U.S. jurisdiction are frozen, and U.S. persons are generally prohibited from engaging in transactions with them.

For more information on OFAC's actions, see our September 28, 2016, OFAC Update.

The Consumer Financial Protection Bureau has published at 81 FR 66930 in this morning's Federal Register a Notice of Bureau Official Approval under ECOA concerning the new Uniform Residential Loan Application (URLA) and the collection of expanded HMDA information about ethnicity and race in 2017. Under Part III of the Notice, the Bureau approved (but does not require) the collection of such information for applications received during calendar year 2017, even though Regulation C doesn't mandate the collection of the expanded data until January 1, 2018. The Notice says the Bureau believes the option to begin collecting the expanded data may provide creditors extra time to implement the changes needed to comply with the updated HMDA rules by January 1, 2018.

For reporting 2017 data on applications on which final action is taken during 2017, only the aggregate categories and codes in the filing instructions for data collected in 2017 will be used, even if applicants have self-identified using the expanded "disaggregated" categories. For applications taken in 2017 on which final action is taken on or after January 1, 2018, institutions can optionally submit data using disaggregated categories if provided by applicants instead of using the transition rule for those submissions.

The CFPB complaint snapshot this month spotlights money transfer complaints. The report shows that consumers continue to experience issues when attempting to resolve problems with disputed transactions. The report also highlights trends seen in complaints coming from Pennsylvania.

The Financial Action Task Force (FATF) has released its mutual evaluation report on Singapore’s anti-money laundering and counter-terrorist financing activities.

The Federal Trade Commission has announced it will return almost $20 million to more than 145,000 consumers across the country who were victimized by One Technologies LP and its two partner companies in an online scheme that lured consumers with “free” access to their credit scores and then billed them a recurring $29.95 monthly fee for credit monitoring they never ordered. The company marketed their credit monitoring programs, MyCreditHealth and ScoreSense, through at least 50 websites, including FreeScore360.com, FreeScoreOnline.com, and ScoreSense.com. The FTC alleged that the defendants violated the FTC Act and the Restore Online Shoppers' Confidence Act (ROSCA), which prohibits charging consumers for goods or services sold online via a negative option unless the seller clearly discloses all material terms before obtaining the consumer’s billing information, obtains the consumer’s express informed consent before making the charge, and provides a simple way to stop recurring charges.

The Federal Reserve Board issued 31 Section 19 Letters during the first half of calendar year 2016. Section 19 of the Federal Deposit Insurance Act prohibits a person convicted of a crime involving dishonesty or breach of trust from becoming or continuing as an institution-affiliated party with respect to any insured depository institution.

The Consumer Financial Protection Bureau (CFPB or Bureau) and the California Department of Business Oversight (DBO), after a coordinated investigation, have separately announced settlements with Flurish, Inc., doing business as LendUp, requiring the firm to make restitution to consumers.

The CFPB found that the company did not give consumers the opportunity to build credit and provide access to cheaper loans, as it claimed to consumers it would. The Bureau has ordered the company to provide more than 50,000 consumers with approximately $1.83 million in refunds. The company will also pay a civil penalty of $1.8 million to the Bureau's Civil Penalty Fund.

The DBO found over 385,000 violations of two state consumer protection laws and of the Federal Truth in Lending Act in examinations under those laws and ordered LendUp to pay $1.62 million in consumer refunds, a $100,000 penalty and $965,462 in costs. For details on the settlements with Flurish, Inc., see "LendUp penalized by CFPB and California for violations," in our Penalties pages.

The Consumer Financial Protection Bureau has taken action against TitleMax parent company TMX Finance LLC for luring consumers into costly loan renewals by presenting them with misleading information about the deals’ terms and costs. The lender also used unfair debt collection tactics that illegally exposed information about debts to borrowers’ employers, friends, and family. The Bureau ordered TMX Finance to stop its unlawful practices and pay a $9 million penalty. For more information, see "TMX Finance LLC pays $9M for lending UDAAP violations," in our Penalties pages.