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Banker's Toolbox Announces — ACQUISITION OF LOAN LOSS RESERVE POWERHOUSE, MAINSTREET TECHNOLOGIES
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.)

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E.g., Jun 24 2019

05/28/2019

Senior Safe Act fact sheet

The Securities and Exchange Commission, the North American Securities Administrators Association (NASAA), and the Financial Industry Regulatory Authority (FINRA) have issued a fact sheet to help raise awareness among broker-dealers, investment advisers, and transfer agents of the Senior Safe Act and how the Act’s immunity provisions work. The SEC's Seniors webpage provides information on the immunity and training provisions of the Act, as well as additional resources from the SEC, NASAA, and FINRA.

05/24/2019

Landlord pays $37,000 to settle harassment claims

HUD has approved an agreement between a Minneapolis property owner and a female tenant who alleged the landlord solicited sex from her in exchange for a reduction in her rent. The case came to HUD’s attention when a woman filed a complaint with HUD alleging that her landlord, David Sheets, sexually harassed her while she was living in one of his apartments. Specifically, the woman alleged that on numerous occasions during her tenancy, the landlord requested sex from her in exchange for a reduction in her rent. Under the terms of the agreement, the landlord, who denied the allegations, will pay $30,000 to the woman and $7,000 to her attorney. The agreement also requires that the landlord contract with a licensed, independent third-party real estate management company to manage all of his residential properties for the next five years.

05/24/2019

OCC statement on end of 'Choke Point' suit

Yesterday, the OCC released a statement on the dismissal of the long-running lawsuit alleging regulatory pressure on banks to close payday lender bank accounts. In its statement, the OCC (one of the defendants in the action) said that the OCC did not participate in "Operation Choke Point" or any purported conspiracy to force banks to end the bank accounts of the plaintiffs or other payday lenders, and that the agency had not entered into the settlement agreement recently announced by the FDIC.

05/24/2019

Fed TDF testing continues

The Federal Reserve has announced plans to continue its previously announced periodic testing of the Term Deposit Facility (TDF) with one operation in May 2019. These operations are aimed at ensuring the operational readiness of the TDF and providing eligible institutions with an opportunity to maintain familiarity with term deposit procedures. The TDF test operations are a matter of prudent planning and have no implications for the near-term conduct of monetary policy. On May 30, 2019, the Federal Reserve will conduct a floating-rate offering of term deposits with an early withdrawal feature through its TDF. Seven-day term deposits will be offered, with a rate set equal to the sum of the interest rate paid on excess reserves plus a fixed spread of 1 basis point. The maximum tender amount per institution will be $250,000,000. The operation window will be open from 10:30 a.m. to 12:30 p.m. EDT, and awarded deposits will settle the same day the operation is executed. Additional information, including the steps that institutions must complete to be eligible to participate in term deposit operations, is available.

05/24/2019

Proposed revisions to capital and liquidity requirements

The OCC, Federal Reserve, and FDIC have jointly published a proposal that would determine the application of regulatory capital requirements to certain U.S. intermediate holding companies of foreign banking organizations and their depository institution subsidiaries and the application of standardized liquidity requirements with respect to certain U.S. operations of large foreign banking organizations and certain of their depository institution subsidiaries, each according to risk-based categories. For liquidity, the proposal would require a foreign banking organization that meets certain criteria to comply with liquidity coverage ratio and net stable funding ratio requirements with respect to any U.S. intermediate holding company and certain depository institution subsidiaries. The Fed is also requesting comment on (but not proposing) whether it should impose standardized liquidity requirements on such foreign banking organizations with respect to their U.S. branch and agency networks, as well as possible approaches for doing so.

Comments are due in 28 days (by June 21, 2019).

05/24/2019

Senior financial officers survey results

The Federal Reserve has released results of a survey of senior financial officers at banks about their strategies and practices for managing reserve balances. The Senior Financial Officer Survey has been used on occasion by the Board to obtain information about deposit pricing and behavior, bank liability management, the provision of financial services, and reserve management strategies and practices. The most recent survey was conducted in collaboration with the Federal Reserve Bank of New York between February 7, 2019, and February 21, 2019, and includes responses from banks that held roughly three quarters of total reserve balances at the time of the survey.

05/24/2019

April residential sales decline

HUD and the Census Bureau have jointly announced statistics on new residential sales for April 2019:

  • New Home Sales - Sales of new single-family houses in April 2019 were at a seasonally adjusted annual rate of 673,000. This is 6.9 percent below the revised March rate of 723,000 and 7.0 percent above the April 2018 estimate of 629,000.
  • Sales Price - The median sales price of new houses sold in April 2019 was $342,200. The average sales price was $393,700
  • For Sale Inventory - The seasonally adjusted estimate of new houses for sale at the end of April was 332,000. This represents a supply of 5.9 months at the current sales rate.

05/24/2019

Dallas MDIAC meeting announced

The OCC will host a public meeting of the Minority Depository Institutions Advisory Committee (MDIAC) on June 12, 2019, beginning at 1:00 p.m. CDT.at its office at 500 North Akard Street, Suite 1600, Dallas, Texas. The MDIAC advises the OCC on steps the agency may take to ensure the continued health and viability of minority depository institutions and other issues of concern to such institutions.

05/24/2019

Covered Savings Association rule added

The OCC has issued a final rule to implement a new section of the Home Owners' Loan Act. The Economic Growth, Regulatory Relief, and Consumer Protection Act amended HOLA to add a new section that allows a Federal savings association with total consolidated assets equal to or less than $20 billion, as reported by the association to the Comptroller as of December 31, 2017, to elect to operate as a covered savings association. A covered savings association has the same rights and privileges as a national bank and is subject to the same duties, restrictions, penalties, liabilities, conditions, and limitations as a national bank. A covered savings association retains its Federal savings association charter and existing governance framework.

The new rule, published today at 84 FR 23991 as new part 101 of title 12 of the CFR, is effective July 1, 2019.

05/24/2019

Argentina-based narcotics trafficker sanctioned by OFAC

OFAC has identified the Argentina-based Goldpharma Drug Trafficking and Money Laundering Organization as a significant foreign narcotics trafficker under the Foreign Narcotics Kingpin Designation Act. OFAC also designated eight Argentine nationals for their role in the Goldpharma DTO/MLO, as well as nine entities located in Argentina, Colombia, Canada, the United States, the United Kingdom, and the Netherlands. A Kingpin Act chart on the designated individuals was also published.

For identification information on the designated individuals and entities, see BankersOnline's OFAC Update, and note that there are several U.S. (Delaware, Florida, and Texas) addresses involved.

05/24/2019

Fed report on economic well-being of U.S. households

The Federal Reserve Board has issued its latest Report on the Economic Well-Being of U.S. Households, which indicates that most measures of economic well-being and financial resilience in 2018 were similar to, or slightly better than, those in 2017. Overall, the financial experiences reported by the 11,000 adults surveyed in 2018 were largely positive, and many families have experienced substantial gains since the survey began in 2013, in line with the nation's ongoing economic expansion. When asked about their overall economic well-being, 75 percent of U.S. adults said they were "doing okay" or "living comfortably"—up 12 percentage points from 2013.

The survey also asked participants how they would pay for a hypothetical unexpected expense of $400. Sixty-one percent said they would pay the expense with cash, savings, or a credit card paid off at the next statement; 27 percent would borrow or sell something; and 12 percent would not be able to cover it. In 2013, only half of adults said they would pay with cash or its equivalent. A new topic in this year's report—aimed at understanding the experiences of bank customers—was the ability of adults to access funds in their bank accounts. Thirteen percent of those with a bank account had at least one problem accessing funds in their account in the prior year. Problems with a bank website or mobile app (7 percent) and delays in funds availability (6 percent) were the most common problems cited. Those with volatile income and low savings were more likely to experience these problems.

05/24/2019

Refunds in rate reduction robocall scam

The Federal Trade Commission will mail 305 checks totaling $314,945 to consumers who paid up-front for worthless credit card interest rate reduction programs pitched by Payless Solutions using illegal robocalls. The complaint filed by the FTC and Florida Office of Attorney General, the Orlando-based defendants illegally called thousands of consumers nationwide—including many seniors—and claimed their program would save them at least $2,500 and enable them to pay off their debts more quickly. After convincing consumers to provide their credit card information, the defendants then charged between $300 and $4,999 up-front for their worthless service. The agencies also alleged that in some cases the defendants illegally charged consumers without their consent. The FTC is providing full refunds, which average more than $1,000 each, to consumers who lost money, as identified by the defendants’ records or by complaints the consumers filed with the FTC or any agency that submits complaints to the FTC’s Consumer Sentinel Network.

05/23/2019

Former marketing officer jailed 70 months for fraud

Ataollah Aminpour, former chief marketing officer of now-defunct Mirae Bank (Los Angeles) was sentenced on May 20, 2019, to 70 months in federal prison for his role in a scheme that caused the Koreatown-based lender to issue more than $15 million in fraudulent loans, and ultimately caused the bank to suffer severe losses. Aminpour, who pleaded guilty in December 2017 to one felony count of making a false statement to a financial institution, was also ordered to pay $7,519,084 in restitution.

According to court documents, Aminpour held himself out as a successful businessman who could help people obtain financing for gas station and car wash businesses with little or no down payment. In some instances, Aminpour would identify a business for the borrower to purchase, and would negotiate the sales price. On the commercial loan applications that Aminpour would submit to the bank on behalf of the borrower, however, Aminpour would overstate the actual purchase price of the business, thereby causing the bank to issue inflated loan amounts that were not fully secured. For example, Aminpour made false statements to Mirae Bank in an application for a $4.2 million loan in connection with the purchase a car wash in Maywood. When he pleaded guilty, Aminpour admitted that, on the application, he falsely stated that the purchase price of the car wash was $6.65 million when the real purchase price was $3.25 million.

In his plea agreement, Aminpour further admitted that his scheme involved false statements in six loan applications submitted between November 2005 and February 2007 for loans totaling $16.7 million, and that losses on those loans exceeded $7.5 million. In addition to the loans charged as part of the fraud in this case, Aminpour referred approximately $150 million in loans to Mirae Bank, and the losses on those loans played a significant role in the bank’s collapse in 2009, according to court documents. The FDIC and Wilshire Bank, which acquired Mirae Bank’s assets from FDIC, together suffered more than $33 million in losses on the Aminpour-referred loans. Wilshire Bank was subsequently acquired by Bank of Hope.

05/23/2019

FDIC resolves 'Operation Choke Point' suit

The FDIC has resolved a lawsuit with Advance America, Cash Advance Centers, Inc., Check Into Cash, Inc., and Northstate Check Exchange (Advance America et al. v. Federal Deposit Insurance Corporation et al). The lawsuit had alleged terminations of payday lender bank accounts under what was described as "Operation Choke Point." In exchange for the plaintiffs' agreement to dismiss the lawsuit, the FDIC issued: (1) a statement summarizing its longstanding policies and guidance regarding the circumstances in which the FDIC recommends that a financial institution terminate a customer's deposit account and reiterating preexisting public guidance to financial institutions about providing banking services and carrying out Bank Secrecy Act obligations; and (2) a cover letter transmitting the statement to the plaintiffs that reiterates prior correspondence from the FDIC Chairman, summarizes applicable FDIC policy, and notes that the FDIC is conducting additional training of its workforce.

05/23/2019

New members appointed to OCC MSAAC

The OCC has appointed four new members of its Mutual Savings Association Advisory Committee (MSAAC):

  • Ana Babiasz, President and Chief Executive Officer, Fidelity Federal Savings and Loan Association, Delaware, Ohio
  • Brian North, President and Chief Executive Officer Fifth District Savings Bank, New Orleans, Louisiana
  • Dennis Parente, President and Chief Executive Officer, Foxboro Federal Savings, Foxborough, Massachusetts
  • Annette Russell, President and Chief Executive Officer, Security Federal Savings Bank, Logansport, Indiana

05/23/2019

Discrimination charges filed against Alabama landlords

HUD reported yesterday that it is charging the property owner and manager of Hunter's Pointe Apartments in Mobile, Alabama, with violating the Fair Housing Act by refusing to accommodate the special needs of a resident with disabilities.

05/23/2019

FOMC statement and minutes

The Federal Reserve Board and the Federal Open Market Committee have released the statement and minutes of the Committee meeting held on April 30–May 1, 2019.

The Committee decided to maintain the target range for the federal funds rate at 2-1/4 to 2-1/2 percent. The Committee statement said the FOMC continues to view sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective as the most likely outcomes. In light of global economic and financial developments and muted inflation pressures, the Committee will be patient as it determines what future adjustments to the target range for the federal funds rate may be appropriate to support these outcomes.

05/23/2019

Counterfeit cashier's check alert

The OCC has posted an alert warning of counterfeit cashier’s checks of Farmers & Merchant’s National Bank, Nashville, Illinois. The bank reported at least four variations of counterfeit checks are in circulation using the bank’s routing number and are being presented for payment nationwide in connection with a variety of online auction and job opportunity scams. For details, see BankersOnline's Alerts and Counterfeits listing.

05/23/2019

Puerto Rico housing authority to pay $885K for discrimination

An agreement has been negotiated by HUD between the Puerto Rico Public Housing Authority (PRPHA) and residents of the housing authority with disabilities. The agreement resolves allegations that the El Trebol public housing development was inaccessible to persons with disabilities for more than a year because of inoperable elevators. Under the terms of the agreement, PRPHA will spend $884,640 to repair existing inoperable elevators and install six new elevators, and pay $23,760 to the four residents who filed the initial complaint. In addition, $32,400 will be paid to 16 other residents with disabilities who were harmed by the prolonged elevator outages.

05/22/2019

Time to kick the NFIP can down the road again?

The National Flood Insurance Program is currently set to expire May 31, 2019, nine days from today. There are three bills in Congress to extend the program. Of those, H.R. 2578, sponsored by Representative Maxine Waters, has passed the House and has been placed on the Senate Legislative Calendar under General Orders. To plan next steps if the NFIP lapses before H.R. 2578 or another extension bill is enacted, review our December 31, 2018, Top Story.

05/22/2019

Former Ohio branch manager banned from industry

The Federal Reserve Board has issued a consent order of prohibition and order to cease and desist to a former Fremont, Ohio, bank branch manager who, according to the order, embezzled approximately $266,039 in cash from bank tellers' drawers between 2009 and June 2018. Under the order, she and another party must fully comply with a payment agreement with the bank requiring reimbursement of the misappropriated funds in monthly installments.

05/22/2019

OCC recommends central beneficial ownership data

Senior Deputy Comptroller for Bank Supervision Policy Grovetta N. Gardineer yesterday discussed efforts to protect the financial system from being misused for illegal purposes during a hearing before the U.S. Senate Committee on Banking, Housing, and Urban Affairs. Gardineer specifically addressed the threats posed to our financial system by the use of shell companies and methods to better identify the true beneficial owners of assets.

05/22/2019

FTC rescinding several FCRA model forms

The Federal Trade Commission has published at 84 FR 23471 in today's Federal Register a final rule rescinding several Model Forms and Disclosures issued under the Fair Credit Reporting Act (“FCRA”) that it has determined are no longer necessary. Given the CFPB's 2018 updates to its model forms and disclosures, the Commission determined that rescinding several of its model forms and disclosures would reduce confusion. The Commission also made conforming amendments to address references to the updated model forms and disclosures in related rules.

The amendments, which are effective today, remove current appendices A and D through H in 16 CFR part 698, redesignating current appendices B (Model Forms for Risk-Based Pricing and Credit Score Exception Notices) and C (Model Forms for Affiliate Marketing Opt-Out Notices) as appendices A and B. Today's final rule includes a table of rescinded 16 CFR part 698 appendices and the corresponding CFPB appendices taking their place.

05/22/2019

Servicemembers enjoy better financial well-being

The CFPB has posted an article announcing the release of a research brief that shows that servicemembers exhibit slightly higher levels of financial well-being compared to the general U.S. population.

05/22/2019

$1.9M in HUD awards for public housing residents

HUD yesterday awarded an additional $1.9 million to the six public housing authorities and non-profit organizations IN Georgia, New Jersey, New Mexico, North Carolina, Rhode Island, and Texas to hire or retain service coordinators to help residents find jobs and educational opportunities:

05/22/2019

Bureau posts meeting notices

The CFPB has published Federal Advisory Committee Act notices of June 5–6 meetings of its Community Bank Advisory Council, Consumer Advisory Board, and Credit Union Advisory Council.

05/21/2019

Fannie and Freddie refinances increase

The Federal Housing Finance Agency (FHFA) has reported that Fannie Mae and Freddie Mac completed 234,716 refinances in the first quarter of 2019. FHFA's first quarter 2019 Refinance Report also shows that 901 loans were refinanced through the Home Affordable Refinance Program (HARP), bringing the total number of HARP refinances to 3,495,296 since inception of the program in 2009. The Report also indicated:

  • Total refinance volume increased in March 2019 as mortgage rates fell in previous months.
  • The average interest rate on a 30-year fixed-rate mortgage fell from 4.37 percent in February to 4.27 percent in March.
  • From April 2009 through March 2019, 2,919,583 loans refinanced through HARP were for primary residences, 110,922 were for second homes and 464,791 were for investment properties.

05/21/2019

FDIC OMWI offers diversity video

FDIC FIL-26-2019, posted yesterday, announces that a video, "Financial Institution Diversity," is available on the FDIC YouTube Channel from the Office of Minority and Women Inclusion. In the video, OMWI Director Saul Schwartz describes the FDIC's Financial Institution Diversity Program. FDIC-regulated financial institutions are encouraged to conduct annual self-assessments of their diversity policies and practices as outlined in the Interagency Policy Statement Establishing Joint Standards for Assessing the Diversity Policies and Practices of Entities Regulated by the Agencies.

05/21/2019

Oklahoma tribe receives CU charter

Yesterday, NCUA Chairman Rodney E. Hood presented a federal credit union charter to the Otoe-Missouria Federal Credit Union in Red Rock, Oklahoma. As the first federal credit union chartered in 2019, the Otoe-Missouria Federal Credit Union will serve the approximately 4,200 members and employees of the Otoe-Missouria Tribe as well as 17 tribal-owned businesses.

05/21/2019

OCC Spring 2019 Semiannual Risk Perspective

The OCC has posted its Semiannual Risk Perspective for Spring 2019. Highlights include:

  • Credit quality is strong when measured by traditional performance metrics, but successive years of growth, incremental easing in underwriting, risk layering, and building credit concentrations result in accumulated risk in loan portfolios.
  • Operational risk is elevated as banks adapt to a changing and increasingly complex operating environment. Key drivers for operational risk include persistent cybersecurity threats as well as innovation in financial products and services, and increasing use of third parties to provide and support operations that are not effectively understood, implemented, and controlled.
  • Compliance risk related to Bank Secrecy Act/Anti-Money Laundering (BSA/AML) is high as banks remain challenged to effectively manage money laundering risks.
  • Interest rate risk and the related liquidity risk implications pose potential challenges to earnings given the uncertain rate environment, competitive pressures, changes in technology, and untested depositor behavior.

05/21/2019

FDCPA proposal published

The CFPB has published [84 FR 23274] its Debt Collection Practices Rule proposal (May 8 Top Story), with a 90-day comment period ending August 19, 2019.

05/21/2019

$5M from HUD for CO detectors

HUD Secretary Carson announced yesterday that $5 million will be made available for the purchase and installation of carbon monoxide detectors in public housing units where they are necessary through HUD’s Emergency Safety and Safety and Security Program. This is the first time HUD is targeting grants specifically for the purchase and installation of CO detectors.

05/20/2019

NY debt-collection law firm sued by CFPB

The CFPB has filed a complaint against Forster & Garbus, LLP, a New York debt-collection law firm. The complaint alleges that Forster & Garbus violated the Fair Debt Collection Practices Act by representing to consumers that attorneys were meaningfully involved in its lawsuits when, in fact, attorneys were not meaningfully involved in preparing or filing them. The complaint also alleges that the firm violated the Consumer Financial Protection Act’s prohibition against deceptive acts and practices by making such representations to consumers through its lawsuits. The Bureau seeks an injunction against Forster & Garbus, as well as damages, redress to consumers, disgorgement of ill-gotten gains, and the imposition of a civil money penalty.

05/20/2019

Reserve Banks financial statements and balance sheets

The Federal Reserve Board has released the Q1 2019 combined unaudited financial statements and balance sheets of the Federal Reserve Banks.

05/20/2019

HUD receives IT award

HUD has received MicroStrategy’s 2019 Federal Information Technology Innovation Award for modernizing its Office of Community Planning and Development's (CPD) Grants Dashboard, which provides funding information for each city and state that receives CPD program funds, in a place-based format. Before modernizing the Grants Dashboard, HUD relied on manual reports that could not efficiently drive critical decisions or provide oversight into all grant programs.

05/20/2019

Tentative FOMC 2020 meeting schedule

The Federal Reserve has posted a tentative schedule of the 2020 meetings of the Federal Open Market Committee.

05/20/2019

ACH use for foreign remittance transfers

The Federal Reserve Board has reported to Congress on the use of the ACH system and other payment mechanisms or remittance transfers to foreign countries. The report discusses the Board’s work to expand the use of the automated clearing house and other payment systems for remittance transfers to foreign countries.

05/20/2019

New York credit union conserved

The NCUA has announced the New York State Department of Financial Services has taken possession of Municipal Credit Union, located in New York City, and appointed the National Credit Union Administration as conservator. Member services will continue uninterrupted at all of the credit union’s 22 branch locations in the New York metropolitan area. Members can continue to conduct normal financial transactions, deposit and access funds, make loan payments, and use shares during the conservatorship.

Municipal Credit Union has 588,059 members and assets of more than $3 billion, according to its most recent Call Report. It serves persons working for the city of New York, along with other approved groups and associations.

05/20/2019

Mexican judge and a former governor designated by OFAC

OFAC has designated a Mexican magistrate judge and a former Mexican governor for their involvement in corruption activities. OFAC designated Mexican magistrate judge Isidro Avelar Gutierrez under the Foreign Narcotics Kingpin Designation Act (Kingpin Act) because of his actions on behalf of the Cartel de Jalisco Nueva Generacion (CJNG) and the Los Cuinis Drug Trafficking Organization (Los Cuinis), two closely allied narcotics trafficking organizations designated pursuant to the Kingpin Act in 2015. Avelar Gutierrez received bribes from these narcotics trafficking organizations in exchange for providing favorable judicial rulings to their senior members. OFAC also designated Roberto Sandoval Castaneda, the former governor of the Mexican state of Nayarit, pursuant to Executive Order (E.O.) 13818, which builds upon and implements the Global Magnitsky Human Rights Accountability Act and targets perpetrators of serious human rights abuse and corruption.

OFAC also designated today under E.O. 13818 three of Sandoval Castaneda’s complicit family members who have acted or purported to act on his behalf by holding his ill-gotten assets in their names. Four Mexican entities were also designated today for being owned or controlled by Sandoval or a designated family member.

For information on these and other individuals and entities designated on May 17, see BankersOnline's OFAC Update.

05/17/2019

Otting discusses reform and diversity with House committee

Comptroller Otting testified before the House Financial Services Committee and discussed efforts to implement reforms to ensure banks operate in a safe, sound, and fair manner as well as work to promote diversity within the Office of the Comptroller of the Currency and the federal banking system. He also discussed implementation of the Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018, the condition of the federal banking system, and risks the agency is monitoring.

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