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Banker's Toolbox, Inc., leaders in compliance solutions for financial institutions, announced the acquisition of Georgia-based MainStreet Technologies (MST). MST is an industry leader in the loan risk management space. This acquisition adds to a strong and growing portfolio of compliance-related solutions and will continue to enhance the value Banker's Toolbox brings to both their customers and the industry. (Read full press release here.)

Top Story Lending Related


Residential sales slip

HUD and the Census Bureau have announced May 2019 statistics on new residential sales:

  • New home sales: Sales of new single-family houses in May 2019 were at a seasonally adjusted annual rate of 626,000. This is 7.8 percent below the revised April rate of 679,000 and 3.7 percent below the May 2018 estimate of 650,000.
  • Sales price: The median sales price of new houses sold in May 2019 was $308,000. The average sales price was $377,200.
  • For sale inventory: The seasonally adjusted estimate of new houses for sale at the end of May was 333,000. This represents a supply of 6.4 months at the current sales rate.


OCC enforcement actions announced

The OCC has released a list of enforcement actions taken in May against OCC-supervised institutions and individuals affiliated with them. Among those actions were:

  • A Notice of Charges for an order of prohibition was issued against a former personal banking representative at Massachusetts branches of Santander Bank, N.A., Wilmington, Delaware, who misappropriated $46,027 of bank customer funds and created false bank entries. The Notice announces the OCC's intention to issue the order of prohibition, subject to the respondent's right to an administrative hearing of the OCC's charges.
  • A Notice of Prohibition was issued against a former Chief Executive Office and Chairman of the Board of Directors of The Federal Savings Bank, FSB, Chicago, Illinois, who has been indicted and charged with commission or participation in a crime involving dishonesty and breach of trust. The former banker is charged with using his position to issue $16 million in loans to a borrower whom the banker expected would, in return, assist the banker in obtained a senior position with an incoming presidential administration. When the borrower defaulted on the loans, the bank suffered a multi-million dollar loss.
  • An Order of Prohibition was issued against a former New York Branch Manger of JPMorgan Chase Bank, National Association, Columbus, Ohio, for theft of $4,992 from his teller drawer.
  • An Order of Prohibition was issued against a former Store Manager of Wells Fargo Bank, N.A., who inappropriately processed temporary memo credits to falsely inflate the balance of her personal account.


    Fake credit repair scheme assets frozen

    The Federal Trade Commission has announced that a federal court has issued a temporary restraining order halting the operations and freezing the assets of Grand Teton Professionals LLC, an alleged credit repair scheme that charged illegal upfront fees and falsely claimed to repair consumers' credit. The company and other defendants are charged with violating the Federal Trade Commission Act and several provisions of the Credit Repair Organizations Act, the Telemarketing Sales Rule, the Consumer Review Fairness Act, the Truth in Lending Act, and the Electronic Funds Transfer Act. A complaint filed by the FTC alleges that, since at least 2014, two of the defendants, Douglas Filter and Marcio G. Andrade, have operated an unlawful credit repair scam that bilked consumers out of at least $6.2 million.


    Lead paint, dust and soil exposure standards strengthened

    The Environmental Protection Agency has announced new, tighter standards for lead in dust on floors and window sills to protect children from the harmful effects of lead exposure. The strengthened standards become effective 180 days after publication in the Federal Register.


    MLA website changes scheduled this week

    The Defense Manpower Data Center (DMDC) has announced that on June 27, 2019, it will make significant changes to the Military Lending Act (MLA) website to enhance security of the site and better protect the personal information of servicemembers. All users of the site will be required to create user accounts, which will be required to access both the Single Record Request and the Multiple Record Request capabilities of the site. In addition to the username, password, company name, and challenge questions currently required to create a user account, beginning June 27, 2019, new MLA website users will be required to supply the user's first name, last name, address, and e-mail address in order to create an account. Starting around mid-August 2019, existing MLA website users will be required to update their accounts with the additional fields.


    Fannie and Freddie foreclosure prevention

    The FHFA released its First Quarter 2019 Foreclosure Prevention Report, which shows that Fannie Mae and Freddie Mac completed 38,968 foreclosure prevention actions in the first quarter of 2019, bringing the total number of foreclosure prevention actions to 4,322,804 since September 2008. The report also shows that 38 percent of loan modifications completed in the first quarter reduced borrowers' monthly payments by more than 20 percent. The Enterprises' serious delinquency rate dropped to 0.71 percent at the end of the first quarter. This compares with 3.45 percent for Federal Housing Administration (FHA) loans, 1.87 percent for Veterans Affairs (VA) loans and 1.96 percent for all loans (industry average).


    SBA proposes enhanced supervision of 7(a) loan program

    The Small Business Administration has published at 84 FR 29092 a proposed rule to implement the Small Business 7(a) Lending Oversight Reform Act of 2018, and to update the Agency's regulations on supervision of all lenders participating in SBA's business loan programs. The purpose of the Act was to increase the SBA's oversight capabilities and to ensure the integrity of the 7(a) Loan Program. The Act contains several new and strengthened authorities. Comments on the proposal are due by August 20, 2019.


    OCC rescinds mortgage guidance, issues core principles

    The OCC has issued Bulletin 2019-28 rescinding Bulletin 2017-28 ("Mortgage Lending: Risk Management Guidance for Higher-Loan-to-Value Lending Programs in Communities Targeted for Revitalization"), issued August 21, 2017, replacing the Guidance with a set of core principles for such lending. The OCC encourages banks interested in making higher-LTV loans in communities targeted for revitalization by a federal, state, or municipal governmental entity or agency to:

    • refer to the core lending principles in Bulletin 2019-28 when considering making higher-LTV loans.
    • discuss plans to offer higher-LTV loans with their OCC supervisory office before implementation, particularly if the offerings constitute substantial deviations from the bank’s existing strategic or business plans.


    Amendments to SEC auditor independence rules

    The SEC has adopted amendments to the auditor independence rules relating to the analysis that must be conducted to determine whether an auditor is independent when the auditor has a lending relationship with certain shareholders of an audit client. A fact sheet was issued as part of the Commission's press release.

    The amendments will become effective 90 days after they are published in the Federal Register.


    Tribal communities receive $63M from HUD

    HUD has awarded $63 million under its Indian Community Development Block Grant (ICDBG) Program to 85 Native American communities across the country to improve housing conditions and stimulate community development for residents, including funding construction projects that generate local job opportunities.


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