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Top Story Compliance Related

07/20/2020

OFAC targets Chinese drug traffickers and Ortega inner circle

On Friday, Treasury reported that OFAC had designated four individuals and one entity under the Fopreiogn Narcotics Kingpin Designation Act for providing support to the Zheng Drug Trafficking Organization.

Treasury also announced that OFAC had designated Juan Carlos Ortega Murillo, son of Nicaraguan President Daniel Ortega; Jose Jorge Mojica Mejia; and two companies they use in an effort to distribute regime propaganda and launder money.

For identity information on the individuals and entities designated, see BankersOnline's OFAC Update, which also includes a list of removals and an update made by OFAC on Friday.

07/17/2020

CFPB updates COVID-19 consumer complaint data

The CFPB has issued an updated Complaint Bulletin, analyzing the more than 8,000 complaints it received from January through May 2020 that mention coronavirus or related terms. The bulletin shows that mortgage (19 percent), credit card (18 percent), and credit or consumer reporting (18 percent) complaints top the list of those the Bureau has received that mention coronavirus keywords.

  • In 55 percent of mortgage complaints, consumers identified struggling to pay the mortgage as the issue.
  • In 23 percent of credit card complaints, consumers identified a problem with purchase shown or statement as the issue.
  • In 55 percent of credit or consumer reporting complaints, consumers identified incorrect information on their credit report as the issue.

07/17/2020

FTC sends $1M+ to scam victim businesses

The Federal Trade Commission reports it is sending refunds totaling more than $1 million to business owners who were victims of a deceptive scheme that sold labor law posters.

According to lawsuits brought by the FTC, the Florida Office of the Attorney General, and the Texas Office of the Attorney General, Thomas Henry Fred, Jr., and Starwood Consulting, LLC, also doing business as Corporate Compliance Services, sent mailers that looked like invoices from government agencies to newly established businesses. The notices directed them to pay $84 for posters and warned that, “Failure to comply with posting regulations can lead to fines of up to $17,000.” To convince businesses that the mailers were invoices that must be paid, the mailers cited multiple federal statutes and listed a “Business ID” number and a response deadline. The FTC is mailing 26,817 checks with a value of $40.80 each to victims of the scheme.

07/17/2020

FinCEN alert on Twitter virtual currency scam

FinCEN has issued an Alert [FIN-2020-Alert001] emphasizing a high-profile scam exploiting Twitter accounts to solicit fraudulent payments denominated in convertible virtual currency (CVC). Cyber threat actors compromised the accounts of public figures, organizations, and financial institutions to solicit payments to CVC accounts, claiming that any CVC sent to a wallet address would be doubled and returned to the sender. Persons who receive one of these solicitations should not send money or provide any personal or confidential information to these individuals without independent verification of authenticity.

The Alert says it is critical that CVC exchanges and other financial institutions identify and report suspicious transactions associated with this type of activity as quickly as possible. For example, a CVC or other financial account may receive a high volume of payments in a short period of time from previously unaffiliated accounts and/or multiple originating CVC addresses.

07/17/2020

Labor Department seeks info on Family and Medical Leave regs

The Department of Labor has published [85 FR 43513] a request for information regarding the department's regulations implementing the Family and Medical Leave Act of 1993.

The Department is asking the public for information concerning the effectiveness of the current regulations and to aid the Department in its administration of the FMLA. The information provided will help the Department identify topics for which additional compliance assistance could be helpful, including opportunities for outreach to ensure employers are aware of their obligations under the law and employees are informed about their rights and responsibilities in using FMLA leave.

Comments will be accepted through September 15, 2020.

07/17/2020

OFAC amends Nicaragua Sanctions regulations

OFAC has published a final rule [85 FR 43436] in this morning's Federal Register amending the Nicaragua Sanctions Regulations at 31 CFR 582 to incorporate the Nicaragua Human Rights and Anticorruption Act of 2018 by updating the authority citation and the prohibited transactions and delegation sections. OFAC also added a general license authorizing certain United States government activities. The rule is effective today.

07/16/2020

CFPB sues non-bank mortgage creditor for redlining

A CFPB press release reports that the Bureau has filed a lawsuit against Townstone Financial, Inc., a nonbank retail-mortgage creditor based in Chicago, for violations of the Equal Credit Opportunity Act, Regulation B; and the Consumer Financial Protection Act. ECOA and Regulation B prohibit mortgage lenders from discriminating against applicants in credit transactions on the basis of race, color, national origin, or other prohibited bases. ECOA and Regulation B also prohibit mortgage lenders from making statements, or engaging in acts or practices, that would discourage, on a prohibited basis, applicants or prospective applicants from applying for credit. The Bureau’s complaint alleges that Townstone violated ECOA and Regulation B by engaging in discriminatory mortgage-lending practices and that these violations also constituted violations of the CFPA. The complaint says that Townstone:

  • engaged in acts or practices, including making statements during its weekly radio shows and podcasts through which it marketed its services, that illegally discouraged prospective African-American applicants from applying to Townstone for mortgage loans;
  • engaged in illegal redlining by engaging in acts or practices that discouraged prospective applicants living in African-American neighborhoods in the Chicago MSA from applying to Townstone for mortgage loans, including by making discouraging statements during its weekly radio shows and podcasts through which it marketed its services; and
  • engaged in illegal redlining by engaging in acts or practices that discouraged prospective applicants living in other areas from applying to Townstone for mortgage loans for properties located in African-American neighborhoods in the Chicago MSA, including by making discouraging statements during its weekly radio shows and podcasts through which it marketed its services.

07/16/2020

Bureau article on military consumer protection

To mark Military Consumer Protection Month and National Consumer Protection Week, the CFPB has posted a blog article, "Alphabet soup: The ABCs of military consumer protection." The article summarizes and provides links to information on:

  • The Servicemembers Civil Relief Act (SCRA)
  • The Military Lending Act (MLA)
  • The Fair Debt Collection Practices Act (FDCPA)
  • The Fair Credit Reporting Act (FCRA)
  • Local and state laws

07/16/2020

OFAC targets entities facilitating Yevgeniy Prigozhin

Treasury has announced that OFAC has taken action as part of its ongoing sanctions efforts regarding financier Yevgeniy Prigozhin, by targeting entities located in Sudan, Hong Kong, and Thailand that have enabled his ability to evade U.S. sanctions. The actors targeted have directly facilitated Prigozhin’s global operations and attempted to suppress and discredit protestors seeking democratic reforms in Sudan.

OFAC’s action targets three individuals and five entities directly involved in furthering Prigozhin’s operations in Sudan and assisting his ability to evade sanctions. For information on the targeted individuals and entities, see BankersOnline's OFAC Update.

07/15/2020

FinCEN advisory on FATF list of AML/CFT-deficient countries

FinCEN has issued Advisory FIN-2020-A004 on the Financial Action Task Force-identified jurisdictions with AML/CFT deficiencies, which the FATF re-issued on June 30.

FinCEN advises that financial institutions should consider the FATF’s statements when reviewing their obligations and risk-based policies, procedures, and practices with respect to the jurisdictions identified for increased monitoring (Albania, The Bahamas, Barbados, Botswana, Burma (Myanmar), Cambodia, Ghana, Iceland, Jamaica, Mauritius, Mongolia, Nicaragua, Pakistan, Panama, Syria, Uganda, Yemen, and Zimbabwe).

The FATF made the initial determination that Iceland and Mongolia have substantially completed their action plans, and issued statements noting their progress. Iceland and Mongolia will remain identified as “Jurisdictions under Increased Monitoring” until the FATF can conduct on-site visits to verify that each country has begun implementing its reforms.

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