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FinCEN issues advisory on crimes targeting EIPs

FinCEN has issued Advisory FIN-2021-A002, on Financial Crimes Targeting COVID-19 Economic Impact Payments [a/k/a "Stimulus Payments"]. The Advisory contains descriptions of EIP fraud, associated red flag indicators, and information on reporting suspicious activity. It is part of a series published by FinCEN on COVID-19-related frauds and criminal activity. Additional COVID-19-related information is located on FinCEN’s website at


FHA extends 203(k) rehab projects

The Federal Housing Administration (FHA) has announced the extensions of a set of policy flexibilities for single family lenders and servicers designed to maintain new mortgage originations for homebuyers and allow 203(k) rehabilitation projects to continue during the COVID-19 pandemic. These temporary policies recognize the sustained need for flexibility during this critical time to ensure mortgage financing remains available for low- and moderate-income homebuyers, and that home rehabilitation work can continue. The temporary policies will be in place through June 30, 2021. For more information see Mortgage Letter 2021-06 and Mortgage Letter 2021-07.


$2.7B awarded for public housing

HUD has announced the award of more than $2.7 billion in funding to nearly 2,900 public housing authorities in all 50 states and the District of Columbia, Guam, Puerto Rico and the U.S. Virgin Islands to make capital investments in their public housing units. The grants are provided through HUD's Capital Fund Program, which offers annual funding to all public housing authorities to build, renovate, and/or modernize the public housing in their communities. Housing authorities can use the funding to complete large-scale improvements such as replacing roofs or making energy-efficient upgrades to heating systems and installing water conservation measures.


NMLS 2020 Annual Report released

The 13th annual report on NMLS operations, performance and development efforts has been released in conjunction with the start of the NMLS Annual Conference & Training. The report, “Creating a Path to Modernization,” highlights NMLS modernization efforts, the State Examination System, and more.


FRB Discount Rate meeting minutes

The Federal Reserve Board has released the minutes of the January 19 and January 27, 2021, meetings of its discount rate meetings.


FDIC releases fair lending assistance videos

The FDIC's FIL-10-2021 has announced the release of nine technical assistance videos on fair lending. The information in the videos is intended as a high-level overview to help FDIC-supervised institutions assess and mitigate fair lending risk, and to understand how FDIC examiners evaluate fair lending compliance. The videos range in length from approximately 10 to 28 minutes and are available on the FDIC Banker Resource Center.

  • Video 1 provides an overview of the federal fair lending laws and regulations and is intended for bank directors and senior managers.
    Video 2 focuses on how a bank’s compliance management system can mitigate fair lending risk and is intended for bank management and compliance staff.
  • Video 3 discusses how FDIC examiners evaluate fair lending risk during a consumer compliance examination and is intended for bank management and compliance staff.
  • Videos 4-9 discuss specific fair lending risk factors, as provided in the interagency fair lending examination procedures: overt discrimination, underwriting, pricing, steering, redlining, and marketing. These six videos are intended for bank management and compliance staff.


FDIC Quarterly Banking Profile posted

The Fourth Quarter 2020 Quarterly Banking Profile has been posted by the FDIC. It is a quarterly publication that provides the earliest comprehensive summary of financial results for all FDIC-insured institutions.


CFPB reconsidering QM rules

The Bureau has released a statement [scheduled for Federal Register publication on 2/26/2021] on the mandatory compliance date of the General QM Final Rule and possible reconsideration of that rule and the Seasoned QM Final Rule.

The Bureau is considering whether to initiate a rulemaking to revisit the Seasoned QM Final Rule. If the Bureau decides to do so, it expects that it will consider in that rulemaking whether any potential final rule revoking or amending the Seasoned QM Final Rule should affect covered transactions for which an application was received during the period from March 1, 2021, until the effective date of such a final rule.

The Bureau also expects to issue shortly a proposed rule that would delay the July 1, 2021, mandatory compliance date of the General QM Final Rule. If such a proposed rule were finalized, creditors would be able to use either the current General QM loan definition or the revised General QM loan definition for applications received during the period from March 1, 2021, until the delayed mandatory compliance date. Furthermore, the Bureau anticipates that the Temporary GSE QM loan definition will remain in effect until the new mandatory compliance date, except that the Temporary GSE QM loan definition would expire with respect to a GSE if that GSE ceases to operate under conservatorship prior to the new mandatory compliance date.

The Bureau will consider at a later date whether to initiate another rulemaking to reconsider other aspects of the General QM Final Rule. Acting Director Dave Uelio discussed the two rules and the Bureau's plans in a Bureau Blog post yesterday.

The CFPB also posted an update of its small entity compliance guide for the ATR/QM rule, to include the latest amendments to the rule.


Administration tweaks PPP for small business

The White House has issued a Fact Sheet to announce reforms to build on the success of the Payroll Protection Program by further targeting the program to the smallest businesses and those left behind in previous relief efforts. About $150 billion of the PPP funds are still available, but the program is currently scheduled to end March 31, 2021.

The reforms announced in the Fact Sheet include:

  • Instituting a 14-day period, starting February 24, during which only businesses with fewer than 20 employees can apply for relief through the Program
  • Revising the loan calculation formula for sole proprietors and independent contractors to offer more relief, and establishing a $1 billion set aside for businesses in this category without employees and located in low- and moderate-income areas
  • Consistent with a bipartisan bill in Congress, eliminating a restriction that bars small business owners with prior non-fraud felony convictions from the program
  • Eliminating a restriction that bars small business owners who are delinquent on their federal student loans from the program
  • Clarifying that non-citizen small business owners who are lawful U.S. residents may use ITINs to participate in the program

The Small Business Administration has confirmed it will take the actions described by the White House. The 14-day exclusivity period will begin tomorrow, February 24, 2021, at 9 a.m.; the other four changes will be implemented by the first week in March.


Bureau and 3 states sue Libre for predatory immigrant scam

The Consumer Financial Protection Bureau has announced that, in partnership with the attorneys general of Massachusetts, New York, and Virginia, it is suing Libre by Nexus, Inc. and its owners for a predatory immigrant-services scam that traps victims into paying expensive, long-term fees. The CFPB alleges in the complaint that Libre preys on immigrants, primarily Hispanics, who speak little or no English and are being held in federal detention centers, desperate to return to their families. Libre lures its victims through a series of false and misleading statements about its programs, pressuring them to sign abusive, English-only contracts that bind the immigrants to years of exorbitant monthly payments.

According to the CFPB investigation, Libre’s business model preys on detainees and their families desperate to get the detainees out of U.S. Immigration and Customs Enforcement (ICE) detention centers where they have been held, sometimes for months, while awaiting resolution of their immigration cases. In exchange for securing a bond, Libre requires the immigrants to pay a huge upfront fee equal to 25 to 30 percent of the bond plus $420 per month to “lease” GPS-tracking ankle monitors until their case is resolved, usually years later. Unlike a fully-paid bond, these fees are never refunded. In the end, the CFPB alleges, the immigrants often end up paying far more in non-refundable Libre fees than they would have paid for their refundable ICE bond.

The complaint also alleges that Libre:

  • Coerces vulnerable non-English speakers to sign predatory financial contracts in English
  • Deceives consumers about its relationship with immigration authorities
  • Strong-arms detainees with false debt collection threats
  • Incentivizes its employees to deceive and threaten

In its lawsuit, the CFPB is seeking an injunction, damages or restitution to consumers, disgorgement of ill-gotten gains, and the imposition of civil money penalties.


U,S. targets members of Burma's administration

The Treasury Department has announced that OFAC has sanctioned two individuals connected to the military apparatus responsible for the coup in Burma. OFAC took these actions in response to the Burmese security forces’ killing of peaceful protestors, imposing the sanctions under Executive Order 14014, the new Burma-focused sanctions authority President Biden issued on February 11. For identification details, see this BankersOnline OFAC Update.

OFAC also posted updates to CAATSA–Russia-related SDN listings, which can be seen in this BankersOnline OFAC Update.


Regulators' supervisory practices following Texas storms

The OCC, FRB, FDIC, NCUA, and the Conference of State Bank Supervisors issued a statement Monday that they recognize the serious impact of Texas winter storms on the customers and operations of many financial institutions and will provide appropriate regulatory assistance to affected institutions subject to their supervision. The agencies encourage institutions operating in the affected areas to meet the financial services needs of their communities. A complete list of the affected disaster areas can be found HERE.


U.S. house prices up 10.8 percent over last year

The Federal Housing Finance Agency reports that U.S. house prices rose 10.8 percent from the fourth quarter of 2019 to the fourth quarter of 2020 according to the Federal Housing Finance Agency House Price Index. House prices were up 3.8 percent compared to the third quarter of 2020. FHFA's seasonally adjusted monthly index for December was up 1.1 percent from November.

“House prices nationwide recorded the largest annual and quarterly increase in the history of the FHFA HPI," said Dr. Lynn Fisher, Deputy Director of FHFA's Division of Research and Statistics. “Low mortgage rates, pent up demand from homebuyers, and a limited housing supply propelled every region of the country to experience faster growth in 2020 compared to a year ago despite the pandemic. In particular, house prices in western states and cities saw the highest rates of growth, where annual gains often rose above 10 percent."


Call Report changes published

The FDIC, in FIL-8-2021, has announced that the FDIC, OCC and Federal Reserve Board published at 86 FR 10157 in the Federal Register a joint notice and request for comment with final regulatory reporting changes related to asset threshold relief that would apply to the three versions of the Call Report (pending approval by the Office of Management and Budget.

These changes to the Call Report, as described more fully in the Federal Register notice attached to FIL-111-2020, pertain to the interim final rule by the banking agencies published on December 2, 2020, which provides relief to financial institutions with under $10 billion in total assets as of December 31, 2019, by allowing them to calculate their asset size for applicable thresholds in certain rules during calendar years 2020 and 2021 based on the lower of total assets as of December 31, 2019, or as of the normal measurement date.

In addition, the December 2, 2020, interim final rule allows institutions that temporarily exceed the $10 billion total asset threshold to use the community bank leverage ratio framework in Call Report Schedule RC R from December 31, 2020, through December 31, 2021, provided they meet the other qualifying criteria for this framework. For each of these report dates, an institution would use the lesser of its total assets as of December 31, 2019, or as of the current quarter-end report date to determine whether it has met the $10 billion total asset threshold.

The agencies ask that this information be shared with individuals responsible for Call Report preparation in each organization. Comments are due by March 22, 2021.


FEMA to suspend communities from flood program on Friday

FEMA will publish in the Federal Register for February 23, 2021, a notice listing communities in Pennsylvania, Tennessee, and Virginia that it has scheduled for suspension from the National Flood Insurance Program on February 26, 2021, for noncompliance with the program's floodplain management requirements.

  • Pennsylvania: East Buffalo and Susquehanna
  • Tennessee: Brentwood, Cheatham County (unincorporated areas), Hendersonville, Pegram, Pleasant View, Ridgetop, and Robertson County (unincorporated areas)
  • Virginia: Culpeper, Culpeper County (unincorporated areas), and Rappahannock County (unincorporated areas)

If FEMA receives documentation that a listed community has adopted the required management measures before February 26, the community will not be suspended.

UPDATE: Published at 86 FR 10837 on 2/23/2021.


Monetary Policy Report submitted to Congress

The Federal Reserve Board has submitted the 2021 Monetary Policy Report⁠ to the Senate Committee on Banking, Housing, and Urban Affairs and to the House Committee on Financial Services, along with testimony from Federal Reserve Board Chair Jerome Powell. The report required by the Federal Reserve Act contains discussions of "the conduct of monetary policy and economic developments and prospects for the future."


Report on large commercial banks

The Federal Reserve Board has released its report of insured U.S. chartered commercial banks that have consolidate assets of $300 million or more, ranked by consolidated assets as of December 31, 2020.


BitPay settles with OFAC for apparent violations

OFAC has announced that BitPay, Inc., a private company based in Atlanta, Georgia, that offers a payment processing solution for merchants to accept digital currency as payment for goods and services, has agreed to remit $507,375 to settle its potential civil liability for 2,102 apparent violations of multiple sanctions programs that occurred between June 2013 and September 2018. BitPay allowed persons who appear to have been located in the Crimea region of Ukraine, Cuba, North Korea, Iran, Sudan, and Syria to transact with merchants in the United States and elsewhere using digital currency on BitPay’s platform even though BitPay had location information, including IP addresses and other location data, about those persons prior to effecting the transactions. BitPay received digital currency payments on behalf of its merchant customers from those merchants’ buyers who were located in sanctioned jurisdictions, converted the digital currency to fiat currency, and then relayed that currency to its merchants.

OFAC's enforcement action is a reminder that companies involved in providing digital currency services—like all financial service providers—should understand the sanctions risks associated with providing digital currency services and should take steps necessary to mitigate those risks. Companies that facilitate or engage in online commerce or process transactions using digital currency are responsible for ensuring that they do not engage in unauthorized transactions prohibited by OFAC sanctions, such as dealings with blocked persons or property, or engaging in prohibited trade or investment-related transactions.


CFPB partners with communities

The CFPB has announced that it will partner with seven communities to help build financial resiliency among Americans. The partnerships, part of the Bureau’s Start Small, Save Up initiative, aim to increase the number of people having sufficient liquid savings by testing new approaches as well as identifying existing approaches that can assist Americans to become more financially secure.

The CFPB will provide training, technical assistance and other technical support to help community-based organizations build or expand their financial resiliency initiatives. The communities selected are: Great Falls, Montana; Little Rock, Arkansas; Louisville, Kentucky; Manchester, New Hampshire; Richmond, Virginia; Seattle, Washington; and St. Louis, Missouri. The seven communities were among a large number that were considered and represent a broad cross section of the country’s population.


Joint-ownership share account coverage rule

The NCUA Board has approved a final rule amending the NCUA’s regulation governing the requirements for a share account to be separately insured as a joint account. The final rule provides federally insured credit unions with an alternative method to satisfy the membership card or account signature card requirement. For example, under the final rule, the signature card requirement can be satisfied by the credit union having issued a mechanism for accessing the account, such as a debit card, to each co-owner or evidence of usage of the joint share account by each co-owner. The rule, which will be effective 30 days after Federal Register publication, mirrors the similar change made by the FDIC in July 2019.

In addition, the Board was briefed on the Share Insurance Fund’s performance during the fourth quarter of 2020. The fund's equity ratio was at 1.26 percent, lower than the Board-approved normal operating level of 1.38 percent. Chairman Harper noted that the primary factors contributing most significantly to the continuing decline in the equity ratio—strong growth in insured shares and reduced investment returns—remain and will likely continue in the future. He said. “Any future decision by the Board to assess premiums must be data-driven. History has also shown the importance of building up the resiliency of the Share Insurance Fund, so it can handle the potential issues related to the pandemic’s economic fallout that we know are coming.”

PUBLICATION AND EFFECTIVE DATE UPDATE: The final rule amending the NCUA's regulation on share insurance coverage is scheduled for publication on 2/24/2021, It will become effective 3/26/2021.


Fed amends Reg EE Netting rule

The Federal Reserve Board has announced a final rule amending Regulation EE (Financial Institution Netting) to apply netting provisions of the Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA) to certain new clearing organizations including swap dealers. The rule would also make minor clarifications to the existing activities-based test in Regulation EE to clarify how the activities-based test applies following a consolidation of legal entities.

The amendments are intended to reduce risk and increase efficiency in the financial system by applying netting protections to a broader range of financial institutions. The final rule will become effective 30 days after publication in the Federal Register.


OCC announces enforcement actions

The OCC has announced enforcement actions it took in the month of January.

  • A federal savings and loan association in Sidney, Nebraska, was issued a consent order to cease and desist related to management issues
  • A federal savings bank in Chicago, Illinois, was ordered to pay a $193,000 civil money penalty for violations of the OCC's regulation on Loans in Areas Having Special Flood Hazards
  • A bank in Vinita, Oklahoma, received a Prompt Corrective Action Directive
  • A former banking center manager for Webster Bank, N.A. (Waterbury, CT) was issued a consent order of prohibition, after a finding that she withdrew more than $70,000 from a bank customer's account for her personal benefit without authorization.
  • A former store manager for Wells Fargo Bank, N.A. (Sioux Falls, SD) received a consent order of prohibition following a finding that she misappropriated bank customers' confidential information and sold it to a third party for at least $8,000, resulting in a loss to the bank of over $300,000.


COVID-19 testing to be expanded

President Biden yesterday announced three new actions to expand COVID-19 testing, improve the availability of tests, and better prepare for the threat of variants:

  • Expand COVID-19 testing for schools and underserved populations
  • Increase domestic manufacturing of testing supplies
  • Rapidly increase virus genome sequencing


NCUA and IRS to host webinar

The National Credit Union Administration and the Internal Revenue Service are co-hosting “Tax Time Resources for Credit Unions and Consumers,” a webinar on the Earned Income Tax Credit and Volunteer Income Tax Assistance (VITA) programs, on February 23, 2021. The presentation is scheduled to begin at 2 p.m. Eastern and run for approximately 45 minutes. Participants will be able to log into the webinar and view it on their computers or mobile devices. The NCUA and the IRS encourage credit unions, their members, and others to participate in the webinar to learn more about the benefits of these tax programs. Registration is now open.


OCC issues first two Alerts for 2021

The OCC issued two Alerts on Wednesday.

Alert 2021-1 concerns National Bank and Trust, an entity allegedly located in San Francisco, that is misrepresenting itself as a national bank. It is not licensed or chartered.

Alert 2021-2 warns that consumers have reporting receiving various fictitious email messages related to an inheritance/beneficiary scam, which allege to be initiated by the OCC or its senior officials regarding funds purportedly under the control of the OCC.

See the BankersOnline Alerts pages linked above for the details of the OCC Alerts.


OCC announces two new Deputy Comptrollers

The OCC has announced the promotions of Tanya Smith and Michael (Tim) McDonald to Deputy Comptroller for Large Bank Supervision. Ms. Smith is a National Bank Examiner in Large Bank Supervision and currently serves as the Examiner-In-Charge for Wells Fargo. Mr. McDonald is a National Bank Examiner and currently serves as the Examiner-in-Charge for Bank of America. Ms. Smith and Mr. McDonald will assume their new duties this spring.


FOMC minutes posted

The minutes of the Federal Open Market Committee held on January 26–27, 2021, have been released. The minutes for each regularly scheduled meeting of the Committee ordinarily are made available three weeks after the day of the policy decision and later are published in the Board’s Annual Report. The descriptions of economic and financial conditions contained in these minutes are based solely on the information that was available to the Committee at the time of the meeting.


FDIC names Chief Innovation Officer

The FDIC reported Tuesday it had named Sultan Meghji as the agency’s first Chief Innovation Officer, charged with leading the FDIC’s efforts to promote the adoption of innovative technologies across the financial services sector.

FDIC Chairman Jelena McWilliams said, "As a recognized expert in financial technology, Sultan brings years of technical knowledge and an entrepreneurial spirit to our FDiTech team. Under his leadership, I am confident we will find innovative ways to utilize technology to modernize our bank supervision, enable community banks to adopt technological solutions, and bring more underserved people into the financial fabric of our nation.”


Ansarallah designations lifted and OFAC updates SDN list

On Friday, U.S. Secretary of State Antony J. Blinken announced he was revoking, effective February 16, the designations of Ansarallah, sometimes referred to as the Houthis, as a Foreign Terrorist Organization under the Immigration and Nationality Act and as a Specially Designated Global Terrorist pursuant to Executive Order 13224, as amended. Ansarallah leaders Abdul Malik al-Houthi, Abd al-Khaliq Badr al-Din al-Houthi, and Abdullah Yahya al-Hakim remain sanctioned under E.O. 13611 related to acts that threaten the peace, security, or stability of Yemen.

OFAC has acted to make the appropriate deletions and updates to its SDN List and has revoked certain general licenses related to the State Department action. For details, see BankersOnline's OFAC Update.


Bureau publishes HPML escrow rule

The CFPB has published at 86 FR 9840 its final rule exempting certain insured depository institutions and insured credit unions from the requirement to establish escrow accounts for certain higher-priced mortgage loans for publication in today's Federal Register. The rule becomes effective on publication.

See our January 20, 2021, story for details.


OCC, CFPB and NCUA publish supervisory guidance rule

The OCC, CFPB, and NCUA have published their previously announced final rules on the Role of Supervisory Guidance at 86 FR 9253, 86 FR 9261, and 86 FR 7949, respectively. The OCC and CFPB rules will be effective March 15, 2021. The NCUA rule becomes effective March 5, 2021.


HUD extends FHA COVID-19 moratoriums

HUD has announced extensions of the Federal Housing Administration’s (FHA) foreclosure and eviction moratoriums, as well as an extension of the initial start date of a COVID-19 Forbearance. Forbearance is an option mortgage servicers use to provide homeowners with a pause to their monthly payments for a limited period of time during a COVID-19 induced hardship. In addition, the Office of Public and Indian Housing is planning to announce similar relief for Native American and Native Hawaiian homeowners assisted under the Section 184 Indian Home Loan Guarantee Program and the Section 184A Native Hawaiian Housing Loan Guarantee Program.

To address the ongoing need to expand mortgage payment assistance solutions for homeowners, for all FHA-insured forward mortgages, HUD:

  • Extended the timeframe for homeowners to request the start of a COVID-19 Forbearance from their mortgage servicer through June 30, 2021. This extension provides homeowners with additional time to request a forbearance from their mortgage servicer.
  • Expanded the COVID-19 Forbearance to allow up to two forbearance extensions of up to three months each for homeowners who requested a COVID-19 Forbearance on or before June 30, 2020. These additional forbearance extensions will provide relief to homeowners in this situation who will be nearing the end of their maximum 12-month forbearance period and have not yet stabilized their financial situation.
  • Expanded the use of FHA’s streamlined COVID-19 loss mitigation home retention and home disposition options to all homeowners who are behind on their mortgage payments by at least 90 days. This expansion will require mortgage servicers to assess more homeowners for a streamlined waterfall of loss mitigation home retention options, starting with FHA’s COVID-19 Standalone Partial Claim.

To assist seniors with HECMs (home equity conversion mortgages, a/k/a "reverse mortgages"), FHA has extended the timeframe for the start of an initial COVID-19 HECM extension through June 30, 2021. For HECMs that entered an initial extension period on or before June 30, 2020, up to two additional three-month extension periods are available.


December TIC data released

Treasury has released Treasury International Capital (TIC) data for December 2020. The next release, which will report on data for January 2021, is scheduled for March 15, 2021. The sum total in December of all net foreign acquisitions of long-term securities, short-term U.S. securities, and banking flows was a net TIC outflow of $0.6 billion. Of this, net foreign private inflows were $25.5 billion, and net foreign official outflows were $26.1 billion. Foreign residents increased their holdings of long-term U.S. securities in December; net purchases were $97.4 billion. Net purchases by private foreign investors were $86.0 billion, while net purchases by foreign official institutions were $11.4 billion.

U.S. residents decreased their holdings of long-term foreign securities, with net sales of $23.5 billion. Taking into account transactions in both foreign and U.S. securities, net foreign purchases of long-term securities were $121.0 billion. After including adjustments, such as estimates of unrecorded principal payments to foreigners on U.S. asset-backed securities, overall net foreign purchases of long-term securities are estimated to have been $76.2 billion in December. Foreign residents increased their holdings of U.S. Treasury bills by $3.2 billion. Foreign resident holdings of all dollar-denominated short-term U.S. securities and other custody liabilities increased by $4.0 billion. Banks’ own net dollar-denominated liabilities to foreign residents decreased by $80.7 billion.


Fannie and Freddie scorecards released

The FHFA yesterday released the 2021 Scorecard for Fannie Mae, Freddie Mac (the Enterprises), and Common Securitization Solutions. The 2021 Scorecard aligns the 2019 Strategic Plan with the Enterprises’ tactical priorities and operations, serving as an essential tool to hold the Enterprises accountable. The three objectives of the 2021 Scorecard are to ensure that the Enterprises continue to:

  • Focus on their core mission responsibilities to foster competitive, liquid, efficient, and resilient (CLEAR) national housing finance markets that support sustainable homeownership and affordable rental housing;
  • Operate in a safe and sound manner appropriate for entities in conservatorship; and
  • Prepare for their eventual exits from the conservatorships.


FDIC final rule on deposit insurance fees and CECL

The FDIC has announced the adoption of a final rule addressing the temporary deposit insurance assessment effects resulting from certain optional regulatory capital transition provisions relating to the implementation of the current expected credit losses (CECL) methodology. The final rule removes the double counting of a specified portion of the CECL transitional amount or the modified CECL transitional amount, as applicable, in the calculation of certain financial measures that are used to determine assessment rates for large or highly complex insured depository institutions (IDIs). The rule becomes effective April 1, 2021, the beginning of the second quarterly assessment period for 2021.

The FDIC stated the rule does not affect institutions with less than $10 billion in assets, unless they are being treated as large institutions for deposit insurance assessment purposes.


All 1st and 2nd round EIPs issued

The IRS has announced that, as required by law, all legally permitted first and second round of Economic Impact Payments (EIPs or stimulus payments) have been issued and the IRS now turns its full attention to the 2021 filing season.

Beginning in April 2020, the IRS and Treasury Department began delivering the first round of Economic Impact Payments within two weeks of the enabling legislation. The IRS issued more than 160 million EIPs to taxpayers across the country totaling over $270 billion, while simultaneously managing an extended filing season. In addition, since Congress enacted the COVID-related Tax Relief Act of 2020, the IRS has delivered more than 147 million second-round EIPs totaling over $142 billion. The legislation required that the second round of payments be issued by January 15, 2021. While some second round Economic Impact Payments may still be in the mail, the IRS has issued all first and second Economic Impact Payments it is legally permitted to issue, based on information on file for eligible people. Get My Payment was last updated on January 29, 2021, to reflect the final payments and will not update again for first or second Economic Impact Payments.

Most people who are eligible for the Recovery Rebate Credit have already received it, in advance, in these two rounds of Economic Impact Payments. If individuals didn't receive a payment – or if they didn't receive the full amounts – they may be eligible to claim the Recovery Rebate Credit and must file a 2020 tax return. Eligibility for and the amount of the Recovery Rebate Credit are based on 2020 tax year information while the Economic Impact Payments were based on 2019 tax year information. For the first Economic Impact Payment, a 2018 return may have been used if the 2019 was not filed or processed.


Industrial production increases

The G.17 Industrial Production and Capacity Utilization data for January 2021 have been released by the Federal Reserve Board.

Industrial production increased 0.9 percent in January. Manufacturing output rose 1.0 percent, about the same as its average gain over the previous five months. Mining production advanced 2.3 percent, while the output of utilities declined 1.2 percent. At 107.2 percent of its 2012 average, total industrial production in January was 1.8 percent lower than its year-earlier level. Capacity utilization for the industrial sector increased 0.7 percentage point in January to 75.6 percent, a rate that is 4.0 percent below its long-run (1972–2020) average.


Denmark strengthens AML framework

The Financial Action Task Force (FATF) has announced that, since its last assessment in 2017, Denmark has taken a number of actions to strengthen its framework. Today, Denmark is compliant on six of the 40 FATC recommendations and largely compliant on 32 of them. It remains partially compliant on two recommendations.


SBA: COVID-19 EIDL funding exceeds $200B

The SBA has announced that its COVID-19 Economic Injury Disaster Loan (EIDL) program has provided U.S. small businesses, non-profits, and agricultural businesses a total of $200 billion in emergency funding for more than 3.7 million small businesses employing more than 20 million people.


2021 stress test scenarios released

The Federal Reserve Board has released the hypothetical scenarios for its 2021 bank stress tests. Last year, the Board found that large banks were generally well capitalized under a range of hypothetical events but due to continuing economic uncertainty placed restrictions on bank payouts to preserve the strength of the banking sector. The Board's stress tests help ensure that large banks are able to lend to households and businesses even in a severe recession. The exercise evaluates the resilience of large banks by estimating their loan losses and capital levels—which provide a cushion against losses—under hypothetical recession scenarios that extend nine quarters into the future.

The Office of the Comptroller of the Currency also released economic and financial market scenarios for use in the upcoming stress tests for covered institutions. The supervisory scenarios include baseline and severely adverse scenarios.


IRS free webinar: Choosing a tax pro

The Internal Revenue Service will hold a free webinar, "How to Choose a Tax Pro," on Thursday, February 18 at 2 p.m. ET. Participants should register in advance for the hour-long webinar, which will:

  • Provide tips for choosing a tax preparer
  • Explain the types of paid preparers
  • Describe how to use the IRS Directory of Federal Tax Return Preparers
  • Discuss how to avoid "ghost" tax return preparers
  • Review how to make a complaint about a tax return preparer
  • Explain the third-party authorization process


COVID-19 effects reported by local communities

A FEDS Note, "The Effects of COVID-19, as Reported by Local Communities," has been posted by the to the Federal Reserve Board's website. Since early-April 2020, the Community Development function of the Federal Reserve Board and the twelve Federal Reserve Banks have, approximately every eight weeks, surveyed key stakeholders in local communities across the United States to learn about how the COVID-19 pandemic is affecting their community. Survey respondents have included representatives from local, state and federal governments, financial institutions, nonprofit organizations, and private businesses. The February 12, 2021 FEDS Note explores the key findings from these four surveys, including differences across type of respondent (government, financial institution, nonprofit, and private business) and type of community served (i.e. rural, suburban, and urban).


FedNow Service payment flow video

Federal Reserve Financial Services has created a new 3½ minute video to illustrate the FedNow℠ payment flow. It follows a payment over the FedNow Service from start to finish and shows what financial institutions need to know about their role in the process.

Payments processed over the FedNow Service will settle between financial institutions in real time and end users will have access to money sent to them within seconds. Financial institutions that participate in the FedNow Service can meet the evolving needs of their customers and keep pace with the competition. Other benefits include:

  • Attracting and retaining customers
  • Growing revenue (e.g., transaction fees, fees for new service or product offerings)
  • Lowering costs through increased efficiency (e.g., automation and operations)
  • Reducing interbank settlement risk

Federal Reserve Financial Services has said it will start rolling out its FedNow service beginning in 2023.


CFPB: Beware of online romance scams

The CFPB has posted a blog article, "Break up with online romance scams," warning consumers of increased use of romance scams as individuals experience loneliness during the current pandemic. The article offers advice on how to spot a romance scammer, and how to avoid such scams.


Payday lender banned by FTC

The owners and operators of a vast payday lending scheme that overcharged consumers millions of dollars will be permanently banned from the lending industry under the terms of a settlement with the Federal Trade Commission. The settlement also provides that nearly all outstanding debt—made up entirely of illegal finance charges—held by the company will be deemed paid in full.

The scheme, which was operated online under the names Harvest Moon Financial, Gentle Breeze Online, and Green Stream Lending, used deceptive marketing to convince consumers that their loans would be repaid in a fixed number of payments. A complaint filed by the FTC alleged that the company instead continued to draw millions of dollars in payments from consumers’ bank accounts long after the loans’ original principal amount and stated repayment cost had been repaid, and would do so until consumers completely closed their bank accounts or found some other way to cut off payments.

Under the terms of the settlement, Takehisa Naito and Keishi Ikeda, along with their companies Lead Express, Inc.; Camel Coins, Inc.; Sea Mirror, Inc,; Naito Corp.; Kotobuki Marketing, Inc.; Ebisu Marketing, Inc.; Hotei Marketing, Inc.; and Daikoku Marketing, Inc. will be permanently prohibited from making loans or extending credit of any kind. The settlement also includes a monetary judgment of $114.3 million, which is partially suspended based on an inability to pay. The defendants will be required to turn over all corporate assets and almost all domestic personal assets along with a number of vehicles to a receiver. The receiver will wind down and liquidate the business and provide all proceeds to the FTC.


HUD to enforce discrimination ban

Yesterday HUD issued a memorandum announcing that it will administer and enforce the Fair Housing Act to prohibit discrimination on the basis of sexual orientation and gender identity. HUD's action follows an Executive Order issued by President Biden on January 20 addressing the Supreme Court's decision in Bostock v Clayton County, which held that the prohibitions against sex discrimination in the workplace contained in Title VII of the Civil Rights Act of 1964 extend to and include discrimination on the basis of sexual orientation and gender identity. HUD's General Counsel has concluded that the Fair Housing Act’s sex discrimination provisions are comparable to those of Title VII and that they likewise prohibit discrimination because of sexual orientation and gender identity.


U.S. targets leaders of Burma's military coup

Treasury has announced that the Biden administration yesterday launched a new sanctions regime in response to the Burmese military’s February 1 coup against the democratically elected civilian government of Burma. In coordination with the issuance of a new Executive Order, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) designated ten individuals and three entities connected to the military apparatus responsible for the coup. These sanctions specifically target those who played a leading role in the overthrow of Burma’s democratically elected government. The sanctions are not directed at the people of Burma.

As a result of yesterday’s action, all property and interests in property of the individuals and entities 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. Unless authorized by a general or specific license issued by OFAC or otherwise exempt, OFAC’s regulations generally prohibit all transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons.

For identifying information of the designated individuals and entities, see BankersOnline's OFAC Update.


Agencies publish Net Stable Funding rule

The OCC, Federal Reserve Board, and FDIC have published at 86 FR 9120 in today's Federal Register a final rule that implements a stable funding requirement, known as the net stable funding ratio (NSFR), for certain large banking organizations. The final rule establishes a quantitative metric, the NSFR, to measure the stability of the funding profile of certain large banking organizations and requires these banking organizations to maintain minimum amounts of stable funding to support their assets, commitments, and derivatives exposures over a one-year time horizon.

The final rule, which becomes effective July 1, 2021, applies to certain large U.S. depository institution holding companies, depository institutions, and U.S. intermediate holding companies of foreign banking organizations, each with total consolidated assets of $100 billion or more, together with certain depository institution subsidiaries.


Victims of student loan relief scam to receive refunds

The Federal Trade Commission reports it is sending more than $1.7 million to individuals who lost money to a debt relief scheme that targeted individuals trying to pay down their student loan debt. The Commission's complaint alleged that the operators behind Student Debt Relief Group tricked people into thinking the company was affiliated with the Department of Education, charged consumers illegal upfront fees, and collected monthly fees they falsely claimed would be credited toward consumers’ student loans. In reality, the operators of the scheme pocketed people’s money and responded to consumer complaints by changing the name of their company rather than their business practices.

Under the final settlement, the defendants, individual Salar Tahour and his companies—Los Angeles-based M&T Financial Group and American Counseling Center Corp., doing business as Student Debt Relief Group, SDRG, Student Loan Relief Counselors, SLRC, StuDebt, and Capital Advocates Group—are banned from engaging in any future debt relief activities and from making misrepresentations or unsubstantiated claims related to financial or any other products or services.

The FTC is sending 867 checks and 18,559 PayPal refunds, averaging about $88 each.


Fiscal Service releases 2020 progress statement

The Department of Treasury's Bureau of the Fiscal Service has released its third annual Progress Statement, which announced its next phase in transforming federal financial management, Envision 2030. This new, long-term initiative intends to integrate inclusive, consistent customer experience for those who interact with the Fiscal Service. It also frees agency chief financial officers from routine financial transaction processing, allowing them to focus on their agencies’ core missions.


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