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Top Story Compliance Related


Statement on due diligence and PEPs

FinCEN and the prudential financial institution regulators (Fed, FDIC, NCUA and OCC) have issued a "Joint Statement on Bank Secrecy Act Due Diligence Requirements for Customers Who May Be Considered Politically Exposed Persons" to clarify that Bank Secrecy Act (BSA) due diligence requirements for customers who may be considered "politically exposed persons" (PEPs) should be commensurate with the risks posed by the PEP relationship.

The term PEP is commonly used to refer to foreign individuals who are or have been entrusted with a prominent public function, as well as their immediate family members and close associates. By virtue of this public position or relationship, these individuals may present a higher risk that their funds may be the proceeds of corruption or other illicit activity. The Agencies do not interpret the term “politically exposed persons” to include U.S. public officials.


Housing discrimination agreement approved

The Department of Housing and Urban Development has announced its approval of a Conciliation Agreement with the owners and property management company of Springdale Ridge Apartments in Springdale, Arkansas, resolving allegations that they discriminated against several residents because of their national origin and retaliated against an employee living on site who sought to inform the residents of their fair housing rights.


CFPB posts 2021 HMDA FIG and Supplemental Guide

The CFPB has published its HMDA Filing Instructions Guide (FIG) for data collected in 2021 and its Supplemental Guide for Quarterly Filers for 2021. Both of these resources, along with other filer resources, are available on the FFIEC Home Mortgage Disclosure Act webpage.

The Bureau also reminded filers in an August 21 email that, as of March 26, 2020, and until further notice, the Bureau does not intend to cite in an examination or initiate an enforcement action against any institution for failure to report its HMDA data quarterly, as noted in its Statement on Supervisory and Enforcement Practices Regarding Quarterly Reporting Under the Home Mortgage Disclosure Act.


Communities suspended from NFIP

FEMA has published [85 FR 52052, August 24, 2020] a rule identifying communities in Louisiana and Washington that were scheduled for suspension from the National Flood Insurance Program on August 19, 2020, for failure to comply with the floodplain management requirements of the program. If any of the listed communities was able to document that it had adopted the required floodplain management measures by the August 19 date, it was not suspended.

  • Louisiana: Calvin, Jonesboro, and Winnfield
  • Washington: Bellevue, Black Diamond, Burien, Carnation, Covington, Duvall, Enumclaw, Federal Way, Issaquah, Kent, Kirkland, Lake Forest Park, Normandy Park, North Bend, Pacific, Redmond, Renton, Seatac, Seattle, Shoreline. Sykomish, Snoqualmie, Tukwila, and unincorporated areas of King County.


Syrian officials and military leaders sanctioned

OFAC has taken action against the Syrian presidential office and the Syrian Ba’ath Party through its designations of two senior members of the Syrian government—Assad’s top press officer and a prominent member of the Syrian Ba’ath Party. These designations, under the authority of Executive Order 13573, target both individuals for their roles as senior Government of Syria officials.

In addition, the State Department has designated four individuals leading Syrian military units for their efforts to prevent a ceasefire in Syria.

For identification details on the six sanctioned individuals, see BankersOnline's OFAC Update.


TD Bank in $122M settlement for OD fee and FCRA violations

The CFPB announced yesterday a settlement with TD Bank, N.A., regarding its marketing and sale of its optional overdraft service, Debit Card Advance (DCA). TD Bank operates about 1,250 locations throughout much of the eastern part of the country. The Bureau found that TD Bank’s overdraft enrollment practices violated the Electronic Fund Transfer Act and Regulation E by charging consumers overdraft fees for ATM and one-time debit card transactions without obtaining their affirmative consent, and that TD Bank engaged in deceptive and abusive acts or practices in violation of the Consumer Financial Protection Act of 2010.

The Bureau also found that TD Bank engaged in practices prohibited by the Fair Credit Reporting Act and its implementing Regulation V.

The consent order requires TD Bank to provide an estimated $97 million in restitution to about 1.42 million consumers and to pay a civil money penalty of $25 million. For addition information and to access the Bureau's Consent Order, see BankersOnline's penalty pages entry.


CFPB extends comment period

The CFPB has announced that it will extend the comment period on its Request for Information on how best to create a regulatory environment that expands access to credit and ensures that all consumers and communities are protected from discrimination in all aspects of a credit transaction. Comments will be accepted for an additional 60 days, through December 1, 2020.


Iranian airline suppliers designated

OFAC has announced its designation of UAE-based Parthia Cargo and Delta Parts Supply FZC for their material support of Iranian airline Mahan Air. OFAC is also designating UAE-based Iranian national Amin Mahdavi for owning or controlling Parthia Cargo. Together, these companies have provided key parts and logistics services for Mahan Air, which is designated under counterterrorism authorities for support to Iran’s Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF), as well as under a counter proliferation authority that targets weapons of mass destruction proliferators and their supporters.

For identification information on the companies and individual designated by OFAC, see BankersOnline's OFAC Update.


FinCEN statement on BSA enforcement

On August 14, we reported on a joint statement from the federal banking regulatory agencies on Enforcement of Bank Secrecy Act/Anti-Money Laundering Requirements. In their announcements of the joint statement, the agencies reported that FinCEN had issued a Statement on Enforcement of the Bank Secrecy Act. FinCEN released its statement yesterday (August 18).

FinCEN's Statement on Enforcement of the Bank Secrecy Act was issued to provide clarity and transparency to FinCEN's approach when considering compliance or enforcement actions against covered financial institutions that violate the BSA. The statement outlines the administrative actions available to FinCEN, and provides an overview of the information FinCEN analyzes in order to determine the appropriate outcome to violations of the BSA.

In its announcement, FinCEN encouraged financial institutions to voluntarily and promptly report violations, and to candidly and completely cooperate with any investigation.


OFAC sanctions Ugandan adoption scammers

The Treasury Department reports that OFAC has sanctioned four Ugandans -- Ugandan judges Moses Mukiibi and Wilson Musalu Musene, Ugandan lawyer Dorah Mirembe, and Mirembe’s husband, Patrick Ecobu -- under authority of Executive Order 13818, which builds upon and implements the Global Magnitsky Human Rights Accountability Act, for their involvement in an adoption scam that saw many Uganda-born children and their parents victimized by the participants in the scheme.

As a result of OFAC's action, all property and interests in property of the individuals named above, and of any entities that are owned, directly or indirectly, 50 percent or more by them, individually, or with other blocked persons, that are in the United States or in the possession or control of U.S. persons, are blocked and must be reported to OFAC. For identification information on the four designated Ugandan nationals, see our BankersOnline OFAC Update.


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