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The Federal Open Market Committee (FOMC) has released its tentative meeting schedule for 2017.

The FDIC has announced the launch of a survey of banks on their small business lending practices. The web-based survey of roughly 2,000 randomly selected FDIC-insured banks will begin in late June and will be administered by the U.S. Census Bureau on behalf of the FDIC. The Small Business Lending Survey (SBLS) will collect data that provide additional insight into many aspects of small business lending, including nationally representative information on the general characteristics of banks' small business borrowers, the types of credit offered to small businesses, and the relative importance of commercial lending for banks of different sizes and business models. Institutions chosen to participate in the SBLS will be contacted by letter at the end of June with directions on how to proceed.

The FDIC has issued FIL-41-2016 as guidance to help financial institutions and to facilitate recovery in areas of West Virginia affected by severe storms, flooding, landslides, and mudslides.

The CFPB has released its monthly complaint snapshot, this month highlighting complaints about consumer loans, including vehicle loans and leases, installment loans, title loans, and pawn loans. The report shows that consumers continue to complain about issues managing their loans and problems they encounter when they are unable to pay them off. This month’s report also highlights trends seen in complaints coming from Arkansas.

The Bureau also posted an article, “Consumer Voices on Auto Financing,” discussing the challenges faced by consumers in understanding auto loans. The article is the fourth post in the CFPB blog series on auto loans.

The Federal Deposit Insurance Corporation has published amendments to its rules of practice and procedure at 12 CFR Part 308 to adjust the maximum amount of each civil money penalty (CMP) within its jurisdiction to account for inflation. This action is required by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. The interim final rule, published at 81 FR 42235 in this morning's Federal Register, will be effective August 1, 2016. Comments on the rule will be accepted through September 1, 2016. The rule also includes a technical amendment to the Corporation's regulation on Assessments, 12 CFR Part 327.

In remarks at the 2016 Bretton Woods Committee annual meeting, Secretary Lew commented on the United Kingdom’s referendum on membership in the European Union. He said, “We respect the decision of the voters in the U.K. and will work closely with London, Brussels, and our international partners to ensure continued economic stability, security, and prosperity in Europe and globally. In recent weeks, I have been in regular contact with my counterparts and financial market participants in the U.K., E.U. and globally, and we will continue to consult closely in the days, weeks, and months ahead.” The Secretary also discussed recent developments regarding the Trade Promotion Authority, the Export-Import Bank, reforms in the international financial regulatory system, and commitments by China to implement important domestic reforms to coincide with its transition to a consumption-led economy.

The Federal Reserve has released the G.20 finance companies report on owned and managed receivables outstanding and auto loans: terms of credit for April 2016.

In a presentation at the Credit Union National Association's annual America's Credit Union Conference, Chairman Metsger encouraged qualified credit unions to seek certification as Community Development Financial Institutions (CDFIs). “Credit unions are uniquely positioned to advance the goals of the Community Development Financial Institutions Program,” Metsger said, “and I encourage every qualified credit union to make CDFI certification a priority in the next few months. Increasing the number of credit unions with this certification will allow significant dollars to be put to work helping people of modest means meet their financial needs. This is the core of the credit union mission.”

A Federal Trade Commission release informs consumers and telemarketers about important Telemarketing Sales Rule (TSR) amendments that are now in effect. The changes make it unlawful for telemarketers to use three types of payment methods exploited by con artists and scammers. As of this month, it is illegal for telemarketers to ask consumers to pay for goods or services using cash-to-cash money transfers, such as MoneyGram and Western Union provide, or by providing PIN numbers from cash reload cards such as MoneyPak, Vanilla Reload or Reloadit packs. It is also now illegal for telemarketers to use unsigned checks called “remotely created payment orders” (also called "remotely created checks") to withdraw money directly from consumers’ bank accounts. New business guidance to consumers warns that any telemarketer requesting payment using these methods is a scammer because the payment method is illegal.

The Securities and Exchange Commission has voted to propose amendments that would increase the financial thresholds in the "smaller reporting company" definition. The proposed rule to update the definition would expand the number of companies that qualify as smaller reporting companies, thus qualifying for certain existing scaled disclosures provided in Regulations S-K and S-X.

The outcomes of the recently held FATF plenary meeting have been released. The plenary delegates discussed improving transparency and beneficial ownership, and the global response to terrorist financing, including the adoption of a revised Recommendation 8 standard for non-profit organizations. The revised standard aims to ensure that the implementation of Recommendation 8 is in line with the risk-based approach and does not disrupt or discourage legitimate non-profit activities. A statement on Iran was released and the assessments of Austria, Canada and Singapore were discussed.

The FDIC has released a list of enforcement actions taken during May 2016. The list comprises 15 orders, including one consent order, two removal and prohibition orders, three section 19 orders, two civil money penalties and seven terminations of earlier enforcement actions. Of the civil penalty orders, one for $100,000 was issued, together with a removal and prohibition order, to a former institution-affiliated party of a Utah bank for engaging or participating in "violations of law, unsafe or unsound banking practices, and/or breaches of fiduciary duty as an institution-affiliated party" of the bank. The other civil penalty order, for $40,000, was issued to TSB Bank, Lomira, Wisconsin, for alleged violations of 31 C.F.R. § 1010.306(a)(1) -- the requirement to file CTRs within 15 days of the reportable transactions. An institution-affiliated party of another Utah bank received an order of prohibition from further participation in the affairs of any financial institution upon the FDIC's determination that he violated the Real Estate Settlement Procedures Act and Regulation X by agreeing to pay fees for the referral of mortgage loan business.

Notices have been delivered by the Federal Reserve Banks of Philadelphia and Cleveland concerning their preparations, respectively, for the Democratic (July 25–28) and Republican (July 18–21) National Conventions. Each of the conventions has been designated a "National Special Security Event," but Reserve Bank officials currently plan to provide full currency and coin operations.

At the request of the Internal Revenue Service, the Government Accountability Office (GAO) examined the IRS’s efforts to combat identify theft (IDT) refund fraud. The IRS utilizes its taxpayer protection program (TPP) to authenticate the identities of suspicious tax return filers and prevent IDT. IRS estimates that, in 2014, it prevented or recovered $22.5 billion in attempted IDT refund fraud, but paid $3.1 billion in fraudulent IDT refunds. The GAO recommends that IRS update its TPP risk assessment and take appropriate actions to mitigate risks identified in the assessment. GAO also recommends that IRS improve its IDT cost estimates by removing refund thresholds and using return-level data where available. IRS agreed with GAO's TPP recommendations and will update its risk assessment. IRS took action consistent with GAO's IDT cost estimate recommendations.

HUD and the Department of Justice (DOJ) have awarded $8.7 million to address homelessness and reduce recidivism among this justice-involved population through the Pay for Success model. For many individuals convicted of minor crimes, finding jobs and decent housing is so challenging that many are at extreme risk of homelessness or reentering the criminal justice system.

The Federal Reserve Board has updated the list of bank holding companies that have elected as of June 21, 2016, to become or be treated as financial holding companies. The list includes only the top-tier company in each organization.

In remarks to the Urban Financial Services Coalition “Leadership for Change” conference in Washington, D.C., FDIC Chairman Gruenberg discussed the FDIC’s leadership role in promoting economic inclusion. He shared what was learned from research about consumer access to financial services and what the FDIC has done to promote simple, affordable banking to reach those who do not have a banking relationship. The Chairman reviewed how the agency’s work in financial education, in particular Money Smart, which celebrates its 15-year anniversary this year, is helping address the needs of people of all backgrounds and all ages. He concluded with a discussion of the unique role of minority depository institutions and the FDIC's efforts to support these institutions so that they may thrive and serve the people in their communities.

The Financial Acton Task Force (FATF) has updated its statements identifying jurisdictions with strategic deficiencies in their frameworks to combat money laundering and the financing of terrorism and proliferation. FATF continues to calls on countries to apply counter-measures to the Democratic People's Republic of Korea. Myanmar and Papua New Guinea were removed from FATF monitoring under its On-Going Global AML/CFT Compliance Process.

Yesterday, the Office of the Comptroller of the Currency issued Bulletin 2016-23 as a reminder of the Joint Notice of Proposed Rulemaking issued by the Board of Governors, the OCC, FDIC, NCUA, SEC and FHFA, published on June 10 at 81 FR 37669 in the Federal Register. The proposal would establish new requirements for incentive-based compensation at certain covered institutions (those with average total assets of at least $1 billion) regulated by the agencies.

The proposed rule would prohibit incentive-based compensation arrangements that encourage inappropriate risks by a covered institution (1) by providing an executive officer, employee, director, or principal shareholder of the covered institution with excessive compensation, fees, or benefits; or (2) that could lead to material financial loss to the covered financial institution. Comments on the proposed rule are due by July 22, 2016. There had been over 2,300 public comments filed on the proposal as of June 23.

The Office of Foreign Assets Control (OFAC) has sanctioned a Congolese government official, Céléstin Kanyama, for being responsible for or complicit in, or having engaged in, directly or indirectly, the targeting of women, children, or any civilians through the commission of acts of violence, abduction, or forced displacement in the Democratic Republic of the Congo (DRC), and for being a leader of an entity that has, or whose members have, engaged in such conduct. See OFAC Sanctions Congolese Official, in our OFAC Updates pages, for more information.

HyperBranch Medical Technology, Inc. (“HyperBranch”) of Durham, North Carolina, has agreed to pay $107,691.30 to settle potential civil liability for apparent violations of the Iranian Transactions and Sanctions Regulations, 31 C.F.R. part 560, reports OFAC.

HyperBranch is alleged to have exported medical goods to its United Arab Emirates distributor with knowledge or reason to know that the goods were destined for Iran. OFAC determined that HyperBranch voluntarily self-disclosed the apparent violations, and that the apparent violations constitute a non-egregious case. See "Med tech company settles with OFAC," in our Penalties section, for more information.

Sales of new single-family houses in May 2016 were at a seasonally adjusted annual rate of 551,000, according to estimates released jointly by HUD and the U.S. Census Bureau. This is 6.0 percent below the revised April rate of 586,000 but is 8.7 percent above the May 2015 estimate. The median sales price of new houses sold in May 2016 was $290,400; the average sales price was $358,900. The seasonally adjusted estimate of new houses for sale at the end of May was 244,000. This represents a supply of 5.3 months at the current sales rate.

The Federal Housing Finance Agency (FHFA) has announced the release of its first quarter 2016 foreclosure prevention report which indicates Fannie Mae and Freddie Mac completed 49,573 foreclosure prevention actions in the first quarter of 2016, bringing the total number of foreclosure prevention actions to nearly 3.7 million since the start of the conservatorships in September 2008. These measures have helped more than 3.0 million borrowers stay in their homes, including nearly 1.9 million who received permanent loan modifications.

The Federal Reserve Board has announced the results of the supervisory stress tests of the nation’s largest bank holding companies. The companies continue to build their capital levels and improve their credit quality, strengthening their ability to lend to households and businesses during a severe recession. The most severe hypothetical scenario projects that loan losses at the 33 participating bank holding companies would total $385 billion during the nine quarters tested. The "severely adverse" scenario features a severe global recession with the domestic unemployment rate rising five percentage points, accompanied by a heightened period of financial stress, and negative yields for short-term U.S. Treasury securities. The firms' aggregate common equity tier 1 capital ratio, which compares high-quality capital to risk-weighted assets, would fall from an actual 12.3 percent in the fourth quarter of 2015 to a minimum level of 8.4 percent in the hypothetical stress scenario. Since 2009, these firms have added more than $700 billion in common equity capital.

In remarks during an OCC forum on responsible innovation, Comptroller Curry discussed the agency's effort to develop a framework for identifying and evaluating responsible innovation.

The SEC has announced that Merrill Lynch has agreed to pay $415 million and admit wrongdoing to settle charges that it misused customer cash to generate profits for the firm and failed to safeguard customer securities from the claims of its creditors. A second SEC announcement reports that Merrill Lynch also has agreed to pay a $10 million penalty to settle charges that it was responsible for misleading statements in offering materials provided to retail investors for structured notes linked to a proprietary volatility index.

The Treasury Department has circulated the following statement of G-7 finance ministers and central bank governors following yesterday's vote in the United Kingdom to leave the European Union:

"We, G7 Ministers and Governors, respect the intention expressed today by the people of the United Kingdom to exit from the European Union. We are monitoring market developments following the outcome of the referendum on the UK’s membership of the EU.

"We affirm our assessment that the UK economy and financial sector remain resilient and are confident that the UK authorities are well-positioned to address the consequences of the referendum outcome.

"We recognize that excessive volatility and disorderly movements in exchange rates can have adverse implications for economic and financial stability.

"G7 central banks have taken steps to ensure adequate liquidity and to support the functioning of markets. We stand ready to use the established liquidity instruments to that end.

"We will continue to consult closely on market movements and financial stability, and cooperate as appropriate.

"We remain united and continue to maintain our solidarity as G7."

The Board of Governors has issued the following statement:

"The Federal Reserve is carefully monitoring developments in global financial markets, in cooperation with other central banks, following the results of the U.K. referendum on membership in the European Union. The Federal Reserve is prepared to provide dollar liquidity through its existing swap lines with central banks, as necessary, to address pressures in global funding markets, which could have adverse implications for the U.S. economy."

The CFPB has announced the release of a special edition of Supervision Highlights focused specifically on mortgage servicing. The report found that some mortgage servicers continue to use failed technology that has already harmed consumers, putting the company in violation of the CFPB’s new servicing rules. In its examinations covering numerous mortgage servicers since the new CFPB rules took effect in January 2014, CFPB examiners have found violations because of deficient technology and process breakdowns. Specifically, examiners have observed problems with loss mitigation and servicing transfers. To spur industry in its general compliance with CFPB rules, the Bureau today is also releasing an updated mortgage servicing exam manual. Among other things, mortgage servicers should note a greater emphasis on complaint handling and requests by troubled borrowers, and on discrimination issues.

The OCC has announced it will host a public meeting of the Minority Depository Institutions Advisory Committee (MDIAC) in Washington on Tuesday, July 12, 2016, beginning at 8:30 a.m. EDT. The meeting is open to the public.

The FDIC has published FIL-40-2016 announcing the adoption of a Notice of Proposed Rulemaking (NPR) and request for comment, which would amend the FDIC's international banking regulations at 12 CFR Part 347 related to permissible investment activities and the pledging of assets. The proposed rule would remove references to external credit ratings and replace them with appropriate standards of creditworthiness. Comments will be accepted for 60 days following publication in the Federal Register.

Update: The proposal was published at 81 FR 41877 in the June 28, 2016, Federal Register. Comments are due by August 29, 2016.

U.S. Immigration and Customs Enforcement (ICE) has announced that 37 officials from various Paraguayan agencies participated in Cross Border Financial Investigations Training (CBFIT) conducted by ICE and Homeland Security Investigations (HSI) in Buenos Aires, Argentina. The training focused on strategies and investigative techniques to assist with the identification and seizure of illicit funds generated by money laundering organizations engaged in transnational criminal schemes. HSI special agents shared best practices for investigating money laundering schemes, the movement of bulk and virtual currencies and intellectual property rights violations tied to terrorist financing.

The Office of the Comptroller of the Currency announced yesterday that Beverly F. Cole will become its Deputy Comptroller for Compliance Supervision in July. Prior to this position, Ms. Cole served as the Senior Advisor to the Senior Deputy Comptroller for Midsize and Community Bank Supervision where she provided advice on the implementation of policies and procedures relevant to the effective and efficient supervision of national banks and federal savings associations. Ms. Cole is also the Designated Federal Official for the OCC’s Minority Depository Institutions Advisory Committee.

The Federal Housing Finance Agency reported yesterday that U.S. house prices rose in April, up 0.2 percent on a seasonally adjusted basis from the previous month, according to the FHFA monthly House Price Index (HPI). The previously reported 0.7 percent increase in March was revised upward to reflect a 0.8 percent increase.

The Office of the Comptroller of the Currency has issued Bulletin 2016-22 to remind its regulated banks and savings associations of the previously proposed Net Stable Funding Ratio (NSFR) rule by the OCC, FRB, and FDIC that would strengthen the liquidity risk management of large banks and savings associations. The proposed NSFR rule would create a longer-term funding requirement designed to work in concert with the shorter-term liquidity coverage ratio (LCR) rule. While the LCR rule requires large banks and savings associations to hold sufficient high-quality liquid assets to survive a stress scenario lasting 30 days, the proposed NSFR rule would require these institutions to have sources of funding that are stable over a one-year period. The notice of proposed rulemaking was published in the Federal Register on June 1, 2016, and comments are due on August 5, 2016. See our May 4, 2016, Top Story for additional background information.

The Department of Housing and Urban Development has announced the award of more than $42 million in housing counseling grants to hundreds of national, regional and local organizations to help families and individuals with their housing needs and to prevent future foreclosures. HUD’s housing counseling grants and the additional funding they leverage will assist more than 1.4 million households find housing, make more informed housing choices, or keep their current homes.

The Federal Reserve Board's semiannual Monetary Policy Report has been presented to Congress by Chair Janet Yellen. Dr. Yellen also presented testimony regarding the current economic situation and outlook before focusing on monetary policy. She noted the economy has made further progress toward the Federal Reserve's objective of maximum employment, but it is troubling that unemployment rates for certain minority groups remain higher than for the nation overall, and that the annual income of the median African American household is still well below the median income of other U.S. households. Regarding monetary policy, she said stated, "The FOMC continues to anticipate that economic conditions will improve further and that the economy will evolve in a manner that will warrant only gradual increases in the federal funds rate. In addition, the Committee expects that the federal funds rate is likely to remain, for some time, below the levels that are expected to prevail in the longer run because headwinds--which include restraint on U.S. economic activity from economic and financial developments abroad, subdued household formation, and meager productivity growth--mean that the interest rate needed to keep the economy operating near its potential is low by historical standards."

Credit unions can learn how to assist member small businesses while helping their own bottom lines by joining the National Credit Union Administration’s upcoming webinar, “Micro-Enterprise Lending – Making Loans to Small Businesses.”
The 90-minute webinar is scheduled for Wednesday, July 13, 2016 at 2 p.m. ET.

The National Credit Union Administration's Board has published a proposed rule [81 FR 40197] to make several technical amendments to NCUA's rule at 12 CFR 705 governing the Community Development Revolving Loan Fund (CDRLF). The proposed amendments would make the rule more succinct and update it to improve its transparency, organization, and ease of use by credit unions. Comments on the proposal are due by August 22, 2016.

The National Credit Union Administration has published at 81 FR 40152 of today's Federal Register an interim final rule amending its regulations at 12 CFR 747 to adjust the maximum amount of each civil monetary penalty (CMP) within its jurisdiction to account for inflation. This action, including the amount of the adjustments, is required under the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996 and the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. The rule is effective on, and comments are due by, July 21, 2016.

Update: This story has been corrected to reflect the correct effective date.