Archive

COMPLIANCE RISK – READING BUT NOT ACTING

In late 2017 the FDIC’s Dallas Region Quarterly Newsletter contained an article entitled Automated Overdraft Program and One-Time Debit and ATM Opt-In Procedure Considerations. The article described a situation observed in several examinations regarding overdraft programs and the interplay with Regulation E opt-in requirements. The well-written article concluded with the following admonition, “If you self-identify violations or potential issues described in this article, management should immediately modify procedures to prevent consumer harm, identify any customers […]

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CONSUMER COMPLIANCE RATING SYSTEM REVISIONS – WE’RE FROM THE GOVERNMENT AND WE’RE HERE TO HELP YOU!

On November 7th, the FFIEC finalized the issuance of its updated Interagency Consumer Compliance Rating System (“CCRS”).  The press release that accompanied the revision stated that the document was intended to “more fully align the rating system with the FFIEC agencies current risk-focused, tailored examination approaches” and that “the rating system’s adoption will represent no additional regulatory burden for financial institutions”.  Or does it? So, far so good as we’ve all long known, through various […]

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COMPLIANCE REVIEW/AUDIT CONSIDERATIONS FOR 2014

Compliance audits for 2014 are not business as usual. We have all been inundated by the volume of changes. There is confusion regarding when examiners will be ready to begin compliance examinations for the new and revised requirements and how intense those examinations will be. The regulators have indicated that “… oversight of the new mortgage rules in the early months will be sensitive to the progress made by institutions that have been squarely focused […]

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WHAT IS AN EFFECTIVE DATE?

Whenever federal financial institution regulatory agencies issue new final regulations they include an effective date. We have all seen, “The rule is effective January 10, 2014” or “The rule is effective for applications received on or after January 10, 2014,” but what does that mean. Apparently the term “effective date” means different things to different people. For financial institution regulatory agencies the term “effective date” apparently refers to the date by which a financial institution […]

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REGULATION E CIVIL MONETARY PENALTIES

Case 1 – In late July an Indiana bank was assessed a $70,000 penalty for engaging in unfair and deceptive acts or practices by the imposition of requirements on consumers in the resolution of electronic transfer errors which were more onerous than those set forth in Regulation E, thereby effectively delaying, denying or discouraging error resolution claims. Case 2 – In mid-July a bank located in Kentucky was assessed a $100,000 penalty for engaging in unfair […]

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