FTC Extends Red Flag Enforcement Deadline
The Federal Trade Commission has extended its Red Flag Enforcement Deadline until December 31, 2010. This decision continues to impact state chartered credit union. The FTC’s action does not affect other federal regulators whose deadline was November 1, 2008. A link to the announcement is: http://www.ftc.gov/os/2010/05/100528redflagsrule.pdf
FRB Releases Final Clarifications to Regulations E and DD
The clarifications address questions that have arisen during the past few months as well as certain compliance aspects of the rule. In particular they address the prohibition in Regulation E on assessing overdraft fees without the consumer's affirmative consent which applies to all institutions, including those with a policy and practice of declining automated teller machine (ATM) and one-time debit card transactions when an account has insufficient funds. For the full text of the clarifications, see: http://edocket.access.gpo.gov/2010/2010-13280.htm and http://edocket.access.gpo.gov/2010/2010-13281.htm
FinCEN Announces $1,000,000 Civil Money Penalty
This civil money penalty was assessed against Pamrapo Savings Bank, Bayonne, N.J. for violations of the Bank Secrecy Act. Pamrapo’s lack of internal controls combined with unqualified BSA compliance personnel, relatively non-existent training and deficient independent testing resulted in a wholly ineffective BSA compliance program which, in turn, resulted in the failure to file a substantial number of currency transaction and suspicious activity reports in an accurate and timely manner. For the full text of the release, click on this link: http://www.fincen.gov/news_room/nr/html/20100603.html
Federal Regulators Issue Interagency Supervisory Guidance on Bargain Purchases and FDIC- and NCUA-Assisted Acquisitions
This Guidance addresses supervisory considerations related to business combinations that result in bargain purchase gains and the impact such gains have on the acquisition approval process. Approval of an acquisition may be conditioned on the acquiring institution's commitment to maintain specified levels of capital to address the risk of significant retrospective adjustments to the bargain purchase gain or other risks. For the full text of the Guidance, go to: http://www.fdic.gov/news/news/financial/2010/fil10030.html
FFIEC Releases HMDA Update
This update provides information about changes to the Home Mortgage Disclosure Act (HMDA) Institution Disclosure Statements and Metropolitan Statistical Area (MSA) Aggregate and National Aggregate Reports that have been made for presentation of the 2009 HMDA data. As a consequence of changes to the loan price (rate spread) reporting rules made under Regulation C in 2008, the 2009 HMDA data reflect price information reported under two different methodologies. The changes only affect tables that include loan pricing information. The full text of the Update may be read at: http://www.ffiec.gov/hmda/pdf/HMDA_2009Disc_Changes.pdf
FRB Approves Final Rule on Credit Cards
On June 15th the Federal Reserve Board approved a final rule to protect credit card users from unreasonable late payment and other penalty fees and to require credit card issuers to reconsider interest rate increases imposed since the beginning of last year. The new rules require that late payment and other penalty fees be assessed in a way that is fairer and generally less costly for consumers. Under the rule, card issuers must also reevaluate recent interest rate increases and, if appropriate, reduce the rate. The rule goes into effect on August 22, 2010. The entire text of the rule is found at: http://www.federalreserve.gov/newsevents/press/bcreg/20100615a.htm
Are You S.A.F.E. at HOME?
Sorry about the baseball reference, but it was sooooo easy. Besides being a compliance work, I am also an avid baseball fan.
Are you a financial institution regulated by the NCUA or other federal financial institution agency? Do you have residential loan originators working for you?
If so, are these employees registered with the Nationwide Mortgage Licensing System and Registry? Have you adopted policies and procedures to comply with the S.A.F.E. Act?
This is a reminder to stay in tune with developing and ongoing regulations, brought to you by your compliance umpire (oops)!
FinCEN Releases SAR Analysis on Foreclosure Rescue Scams
The Financial Crimes Enforcement Network (FinCEN) released its first analysis of suspicious activity reports (SARs) containing information about potential foreclosure rescue scams on June 17th. The analysis involved 3500 SARs from 2004 to 2009, with over 3000 filed in the last year. The Analysis may be accessed at: http://www.fincen.gov/news_room/nr/html/20100617.html
FinCEN Issues Advisory on Mexican Banking Regulations
The Financial Crimes Enforcement Network issued an advisory on recent changes in Mexican financial regulations applying to Mexican banks that could affect the operations of U.S. financial institutions. On June 15, 2010 the Mexican finance ministry announced new anti-money laundering (AML) regulations that will restrict the amounts of physical cash (banknotes and coins) denominated in U.S. dollars that Mexican banks may receive. The regulations do not restrict non-cash transactions denominated in U.S. currency (e.g., wire transfers, ACH payments, credit card transactions, traveler's checks, etc.). The text of the advisory may be read at: http://www.fincen.gov/statutes_regs/guidance/html/fin-2010-a007.html
FRB Offers Same Day ACH Service
Beginning on Aug. 2, the Federal Reserve Board will offer "an opt-in, same-day settlement service" for Automated Clearing House (ACH) debit payments. The service will be limited to transactions arising from consumer checks converted to ACH and consumer debit transfers initiated over the Internet and phone. The debit transfers will post to institutions' Federal Reserve accounts at 5:00 p.m. ET and same-day return debit transfers will post at 5:30 p.m. ET. The full release is found at: http://www.federalreserve.gov/newsevents/press/other/20100621a.htm
FinCEN Releases 14th SAR Activity Review-By the Numbers
This report covers SARs filed in 2009. It indicates a small drop in filings from 1.29 million to 1.28 million. SARs filed by depository institutions declined for the first time from 732,563 in 2008 to 720,309 in 2009. This is the first drop in total filings since 1996. For your late night reading enjoyment, the Release is found at: http://www.fincen.gov/news_room/nr/html/20100623.html
FDIC Issues Report on Small Dollar Loan Pilot Program
This report is the culmination of a two year pilot program conducted by the FDIC designed to illustrate the feasibility of banks offering alternatives to high-cost credit products, such as payday loans and fee-based overdraft programs. The report outlines lessons learned in designing such programs, and provides a template for safe, affordable and feasible small dollar loans. The full report is available at: http://www.fdic.gov/news/news/financial/2010/fil10031.html
Regulators Issue Joint Rule on Unlawful Internet Gambling Enforcement Act
Through the NCUA Regulatory Alert 10-RA-08 and other channels, the NCUA, OTS and FRB have issued guidance on complying with the joint rule on UIGEA. This guidance provides an overview of UIGEA and the joint rule, a summary chart of the obligations of participants, and examination procedures. The Guidance may be found at: http://www.federalreserve.gov/bankinforeg/regggcg.htm