Top Story Compliance Related

OFAC has designated Mahan Travel and Tourism Sdn Bhd, a Malaysia-based General Service Agent for acting for or on behalf of Mahan Air, an Iranian airline previously designated in connection with Iran’s support for international terrorism. For identification information see the BOL OFAC Update.

The Fed, FDIC, and OCC jointly issued a statement detailing rules and associated reporting requirements that are immediately affected by the enactment of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA). The Fed also issued a statement describing how the Board will not take action to enforce certain regulations and reporting requirements for firms with less than $100 billion in total consolidated assets.

Joint agency press release

The Securities and Exchange Commission has announced that Credit Suisse Group AG will pay approximately $30 million to resolve SEC charges that it obtained investment banking business in the Asia-Pacific region by corruptly influencing foreign officials in violation of Foreign Corrupt Practices Act (FCPA). Credit Suisse also agreed to pay a $47 million criminal penalty to the U.S. Department of Justice. According to the SEC’s order, several senior Credit Suisse managers in the Asia-Pacific region sought to win business by hiring and promoting individuals connected to government officials as part of a quid pro quo arrangement. While the practice of hiring client referrals bypassed the firm’s normal hiring process, employees in other Credit Suisse subsidiaries and affiliates were aware of it and in some instances approved these “relationship hires” or “referral hires.” The SEC’s order found that in a six-year period, Credit Suisse offered to hire more than 100 individuals referred by or connected to foreign government officials, resulting in millions of dollars of business revenue.

The FTC has announced that a federal judge has issued an Order to Credit Bureau Center, LLC and its owner, Michael Brown, to pay more than $5.2 million to return to consumers to resolve FTC charges that they deceived people with fake rental property and deceptive promises of “free” credit reports, and then tricked them into enrolling into a costly monthly credit monitoring service. Brown and his company, formerly known as MyScore LLC, and their co-defendants placed Craigslist ads for rental properties that did not exist or that they had no right to offer for rent. They impersonated property owners and offered property tours if consumers would first obtain credit reports and scores from their websites. These sites claimed to provide “free” credit reports and scores, but then enrolled consumers in a credit monitoring service with monthly charges of $29.94. Many people did not realize they were enrolled until they noticed unexpected charges on their bank or credit card statements, sometimes after several billing cycles.

The FDIC has issued a list of 73 state nonmember banks recently evaluated for compliance with the Community Reinvestment Act. The list covers evaluation ratings that the FDIC assigned to institutions in April 2018. Five of the banks were rated outstanding, and 68 received satisfactory ratings.

OCC Bulletin 2018-19, FDIC FIL-36-2018, and a Bureau statement, all issued yesterday, addressed the impact of the HMDA amendments made by section 104 of the Economic Growth, Regulatory Relief, and Consumer Protection Act, which provides a partial exemption to some smaller volume banks and credit unions from some HMDA data filing requirements. The agencies said:

• The new law will not affect the format of the LARs for institutions filing 2018 data in 2019. Banks and credit unions with the partial exemption will enter an exemption code in fields that they aren't required to complete.
• The Bureau expects to provide a revised filing instructions guide (FIG) later this summer.
• The agencies will not require data resubmission for 2018 HMDA data reported in 2019 unless there are material data errors.
  
• The agencies don't plan to assess penalties for errors in 2018 data, and will focus their exams on diagnosing problems rather than penalizing lenders for them.

OFAC has announced sanctions against Nicaraguan National Police Commissioner Francisco Javier Diaz Madriz and Secretary of the Mayor’s Office of Managua Fidel Antonio Moreno Briones for being responsible for, or the leaders of entities involved in, serious human rights abuse in Nicaragua. OFAC also designated Jose Francisco Lopez Centeno (Lopez), the Vice President of ALBA de Nicaragua (ALBANISA) and President of Petronic, for engaging in corrupt activities. These sanctions are part of OFAC’s ongoing campaign under the Global Magnitsky program to hold individuals who engage in human rights abuses and corruption to account.

For identification information on the three designated individuals, see our OFAC Update.

The Office of the Comptroller of the Currency has released a list of Community Reinvestment Act performance evaluations of national banks, federal savings associations, and insured federal branches of foreign banks. Of the 20 evaluations released, 17 are rated satisfactory and three are rated outstanding.

The Board of Governors has released its annual determination of aggregate consolidated liabilities of financial companies as required by the Dodd-Frank Act. The act prohibits a financial company from combining with another company if the resulting company's liabilities would exceed 10 percent of the aggregate consolidated liabilities of all financial companies. Effective July 1, 2018, aggregate consolidated liabilities equal $20,283,121,945,000. This number, which is the average of the year-end financial sector liabilities of the preceding two years, will be the measure of aggregate consolidated liabilities for purposes of section 622 of the Dodd-Frank Act from July 1, 2018, through June 30, 2019, and financial companies won't be able to combine unless their aggregate liabilities are less than $2.0283 trillion.

OFAC has announced the deletion of the names of eight entities and thirteen individuals designated as specially designated narcotics traffickers from the SDN List. In addition, changes have been made to three existing individual listing and one entity listing. See our OFAC Update for details.