Skip to content

How to gain more from operational risk management practices.
Modern risk management technology solutions improve efficiency and provide greater visibility into risks. Today’s tools provide real-time visibility, action plans, enhanced reporting and business intelligence, and proactive notifications for operational risk. Real-time data empowers banks and financial services organizations to proactively manage risks and instantly detect and mitigate emerging issues. Click here to learn more.

Top Story Compliance Related


CFPB requests input on creating inclusive fair credit environment

The CFPB has issued a request for information to seek public input 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. The information provided will help the Bureau continue to explore ways to address regulatory compliance challenges while fulfilling the Bureau's core mission to prevent unlawful discrimination and foster innovation.

The Bureau is substituting the request for information for a symposium on Equal Credit Opportunity Act issues that had been planned for the fall.

Comments on the request will be accepted for 60 days following publication in the Federal Register.

PUBLICATION UPDATE: Published at 85 FR 46600 on August 3, 2020. Comments will be due by October 2, 2020.

UPDATE: The Bureau has announced it will extend the comment period by 60 days to end December 1, 2020.


Key ISIS financial facilitators in Middle East designated

On Tuesday, OFAC designated two Islamic State of Iraq and Syria (ISIS) financial facilitators located respectively in Syria and Turkey for providing financial support to ISIS.

These individuals have been designated in accordance with Executive Order (E.O.) 13224, which, among other things, targets those who commit acts of terrorism and those who have materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of such acts and of persons previously designated under the E.O.

For identity information on these individuals, see BankersOnline's OFAC Update.

As a result of Tuesday’s action, all property and interests in property of the designated individuals that are in or come within the United States or the possession or control of U.S. persons must be blocked and reported to OFAC. OFAC’s regulations generally prohibit all dealings by U.S. persons or within the United States (including transactions transiting the United States) that involve any property or interests in property of blocked persons. In addition, persons that engage in certain transactions with the individuals designated Tuesday may themselves be exposed to sanctions or subject to an enforcement action.


CFPB settles with mortgage companies

The CFPB has issued consent orders against Sovereign Lending Group, Inc. and Prime Choice Funding, Inc. Sovereign is a California corporation that is licensed as a mortgage broker or lender in about 44 states and the District of Columbia. Prime Choice is a California corporation that is licensed as a mortgage broker or lender in about 35 states and the District of Columbia. Both companies offer and provide mortgage loans guaranteed by the United States Department of Veterans Affairs (VA).

The Bureau found that the companies mailed consumers advertisements for VA-guaranteed mortgages that contained false, misleading, and inaccurate statements or lacked required disclosures, in violation of the Consumer Financial Protection Act’s prohibition against deceptive acts and practices, the Mortgage Acts and Practices – Advertising Rule, and Regulation Z.

The consent order against Sovereign requires Sovereign to pay a civil penalty of $460,000. The consent order against Prime Choice requires Prime Choice to pay a civil penalty of $645,000. The consent orders also impose injunctive relief to prevent future violations, including requiring the companies to bolster their compliance functions by designating an advertising compliance official who must review their mortgage advertisements for compliance with mortgage advertising laws prior to their use; prohibiting misrepresentations similar to those identified by the Bureau; and requiring the companies to comply with certain enhanced disclosure requirements to prevent them from making future misrepresentations.


FTC action bans robocallers who targeted seniors

The Federal Trade Commission reported on Friday that operators of a Florida-based company that allegedly defrauded financially-distressed and often older-adult consumers with deceptive robocalls claiming they could save them money by reducing the interest rates on their credit cards have settled Commission charges that their conduct was both deceptive and illegal. A complaint filed by the FTC against 11 entities and three individuals eleven individuals who ran a maze of interrelated operations targeting financially distressed consumers—often seniors—with offers of bogus credit card interest rate reduction services. In the calls, the defendants deceptively told consumers that for a fee they could lower their credit card interest rates to zero percent permanently for the life of the debt.

The proposed order settling the Commission charges permanently bans the defendants from, among other things: 1) any involvement in the sale of debt-relief products or services; 2) all telemarketing; 3) applying for any product or service on behalf of a consumer without their knowledge and consent or if the defendants know or have reason to believe any of the information on the application is false or misleading; 4) obtaining a cash advance on a consumer’s credit card or submitting billing information for payment without prior approval, and 5) using or benefiting from any consumer information collected through the scheme.


FDIC relaxes Section 19 application restrictions

FDIC FIL-72-2020, issued Friday, announced the FDIC's approval of a final rule to revise and incorporate into the agency’s regulations a longstanding Statement of Policy (SOP) related to individuals with certain criminal offenses on their records who seek employment in the banking industry. Section 19 of the Federal Deposit Insurance Act prohibits a person from participating in the affairs of an FDIC-insured institution if he or she has been convicted of a crime involving dishonesty, breach of trust, or money laundering, or has entered into a pretrial diversion or similar program in connection with a prosecution for such an offense, without the prior written consent of the FDIC. Revising and codifying the SOP into the regulations will provide better transparency and clarity regarding the interpretation of Section 19 and the application process.

The rule now excludes all covered offenses that have been expunged or sealed by a court of competent jurisdiction or by operation of law from being considered an offense of record under Section 19. It also expands the de minimis offenses (minor offenses for which FDIC approval is automatic and no application is required). The FDIC expects the changes will reduce the number of applications required and reduce regulatory burden on banks and individuals. The rule will become effective 30 days after Federal Register publication.

PUBLICATION UPDATE: To be published on 8/20/2020, with an effective date of 9/21/2020.


Fed clarifies FOIA and CSI rules

The Federal Reserve Board has finalized a rule that implements technical, clarifying updates to its Freedom of Information Act (FOIA) procedures and changes to its rules for the disclosure of confidential supervisory information (CSI), which is supervisory information belonging to the Board that may include proprietary financial institution-specific information. The final rule is generally similar to the proposal from June 2019, with a few changes in response to public comments.

The final rule updates the Board's FOIA regulation to be consistent with the Board's current practices and to incorporate recent changes in law and guidance. Some of these changes include updating definitions for expedited processing and the different categories of requesters. The revisions also clarify terms and help users more easily navigate the process of filing a FOIA request. The final rule also updates certain outdated and inefficient restrictions governing the disclosure of CSI. For example, the final rule allows supervised financial institutions to share CSI with all affiliates, rather than only with their parent bank holding companies. In a change from the proposal, the final rule will allow financial institutions to share CSI with service providers without obtaining Reserve Bank approval.

The rule will take effect 30 days after Federal Register publication.


OFAC sanctions two more Maduro supporters

OFAC has designated brothers Santiago Jose Moron Hernandez and Ricardo Jose Moron Hernandez for providing support for Nicolas Ernesto Maduro Guerra and the corrupt activities of members of the illegitimate regime of his father, Nicolas Maduro Moros.

As a result of OFAC's action, all property and interests in property of these individuals that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. In addition, any entities that are owned, directly or indirectly, 50 percent or more by the designated individuals, are also blocked. OFAC’s regulations generally prohibit all dealings by U.S. persons or within (or transiting) the United States that involve any property or interests in property of blocked or designated persons.

For further identification information on the designated individuals, see BankersOnline's OFAC Update.


CFPB symposium on regulation analysis

The CFPB will hold a symposium on July 29, 2020, beginning at 9:30 a.m. EDT, on the use of cost-benefit analysis in consumer financial protection regulation. The event will be webcast.

The Bureau is exploring developments in the cost-benefit analysis arena and will consider lessons that may be useful as it nears the start of its second decade of work. This symposium will consist of two panels of experts. The first panel will consider questions related to how the Bureau should use cost-benefit analysis in developing consumer financial regulations and whether the Bureau’s practices provide the proper incentives for the best use and reporting of cost-benefit analysis.

The second panel will focus on how the Bureau may help advance the methodology of cost-benefit analysis for consumer financial regulation. The panel may also consider the data and economic models that should be developed for cost-benefit analysis of consumer financial regulation, how to address distributional concerns, and how to partner with others in this work.


Published in the Federal Register today

Key proposals and rules published in today's Federal Register, with links to our earlier coverage:


Equifax Alternative Dispute Resolution Program

Equifax has settled a suit (Thomas v. Equifax Information Services, LLC) in the United States District Court for the Eastern District of Virginia. The court approved the settlement related to claims that Equifax included inaccurate information on its credit reports about tax liens and civil judgments, including how they were disposed (or described), or that did not belong on the credit reports.

Equifax has established an Alternative Dispute Resolution Program (“ADR Program”) for consumers who were injured by an Equifax credit report containing an inaccurate civil judgment or tax lien. Affected consumers can participate now. If they are able to show they were injured, they can get a payment of $1,500. The ADR Program is available until December 31, 2021. Consumers may be included if Equifax sent their credit report to a third party between June 28, 2015 and May 14, 2019, and the report contained a tax lien or civil judgment that was inaccurate or did not belong to them.

Consumers should visit the ADR Program website to fill out a form to participate in the program.


Training View All

Penalties View All

Search Top Stories