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November 2019 - Compliance Alert

The Consumer Financial Protection Bureau (CFPB)

CFPB Issues Interpretive Rule on Mortgage Loan Originator Training Requirements

The Consumer Financial Protection Bureau issued a new interpretive rule, clarifying that an employer is not responsible for the training of loan originators with temporary authority. The state will perform this training when the loan originator applies for a state loan originator license.

CFPB Announces Regulation Z and M Dollar Thresholds

The Consumer Financial Protection Bureau and the Federal Reserve Board announced dollar thresholds that will determine exempt consumer credit and lease transactions under Regulation M and Regulation Z. These thresholds are reviewed annually as specified by the Truth in Lending Act and the Consumer Leasing Act and adjusted according to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Based on that, the Truth in Lending Act and the Consumer Leasing Act will apply to credit transactions and consumer leases of $58,300 or less in 2020.

Office of the Comptroller of Currency (OCC)

OCC and Other Agencies Make Changes to Supplementary Leverage Ratio

The Office of the Comptroller of the Currency and the other federal bank regulatory agencies finalized changes to Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA) requirements for banking entities that mostly engage in custodial activities. The changes modified a capital requirement of the EGRRCPA, which requires regulatory agencies to allow banking organizations mostly involved in custody, safekeeping, and asset servicing activities to dismiss some deposits at central banks from their supplementary leverage ratio.

Securities and Exchange Commission (SEC)

SEC Stops Ponzi Scheme

The Securities and Exchange Commission recently put a stop to an alleged $6 Million Ponzi scheme targeting seniors and small business owners. The SEC filed an emergency action and a restraining order and asset freeze on two people, Neil Burkholz and Frank Bianco, and the two companies they run. The SEC’s complaint states that the two defrauded investors by promising investors high returns from their trading strategies when in reality the investments resulted in almost total losses. They also misappropriated investments to repay other investors and transferring $880,000 to themselves and their spouses for personal use.

 

The Federal Reserve Board (FRB)

FRB and other Agencies Issue Final Rule on Treatment of High Volatility Real Estate

The Federal Reserve Board and other agencies issued a final rule on the treatment of high volatility commercial real estate (HVCRE) exposures as it relates to the Economic Growth, Regulatory Relief, and Consumer Protection Act. The final rule clarifies terms in the HRVCE exposure definition and clarifies how to treat credit facilities that finance one- to four-family residential properties and the development of land.

 

 


October 2019 - Compliance Alert

The Consumer Financial Protection Bureau (CFPB)

CFPB Issues Final HMDA to Relieve Smaller Institutions

The Consumer financial protection bureau issued a final rule regarding its Notice of Proposed Rule Making for the Home Mortgage Disclosure Act (HMDA). The rule extends the current threshold for collecting and reporting data about open-end lines of credit under HMDA by two years. The rule also clarifies certain HMDA exemptions regarding rules created by the Economic Growth, Regulatory Relief, and Consumer Protection Act.

Office of the Comptroller of Currency (OCC)

OCC and Other Agencies Seek Comment for Statement on Allowances for Credit Losses and for Guidance on Credit Risk Review Systems

The Office of the Comptroller of the Currency and three other federal agencies requested comments on a proposed Interagency Policy Statement on Allowances for Credit Losses. The goal of this statement is to make sure that the interpretation of the Financial Accounting Standards Board’s credit losses accounting standard is consistent. They also requested comment on a proposed Interagency Guidance on Credit Risk Review Systems, which gives the fundamentals of establishing an ongoing credit risk review in accord with safety standards.

Securities and Exchange Commission (SEC)

SEC Announces Proposed Rule Amendments to Exemptive Applications Procedures

The Securities and Exchange Commission announced that it has proposed rule changes to establish a faster review process for Investment Company Act applications that are notably similar to recent precedents. The rule changes would also establish a new procedure for handling applications that do not meet the new, faster process.

The Federal Deposit Insurance Company (FDIC)

FDIC and Other Agencies Finalize Volcker Rule Changes

The Federal Deposit Insurance Corporation and four other federal agencies announced that they have finalized revisions to the Volcker Rule. The goal of these changes was to simplify compliance requirements for institutions that do not have significant trading activities and make compliance requirements stricter for those that do have significant trading activities.

The Federal Reserve Board (FRB)

FRB Announces Final Rule to Tailor Domestic and Foreign Bank Regulation Based on Their Risk Profile

The Federal Reserve Board announces that I had finalized a rule that modifies regulations for both domestic and foreign banks, making these regulations fit the institution's risk profile. This rule will increase compliance requirements for banks with higher risk and reduces them for banks with lower risks.

 

 

 


What is HMDA?

 

 What is HMDA?  

There are a lot of banking regulations and each one is incredibly important. This is true in both their purpose keeping the banking industry safe and secure and their ability to keep lending, trading, and other activities fair. Recently, the Consumer Financial Protection Bureau finalized rules that clarified exemptions and extended the current threshold for collecting and reporting data about open-end lines of credit under HMDA. But what is HMDA?

 

The Home Mortgage Disclosure Act or HMDA is a federal law in the US. It was enacted by the 94th congress of the United States and went into effect on December 31, 1975, signed into law by President Gerald Ford.

 

HMDA rose from the noticeable shortage of credit offered by banks and financial institutions in certain urban areas. As many of these urban areas declined, Congress came to believe that the decline was caused by institutions not providing home finance loans with good terms to qualified borrowers.

 

HMDA doesn’t necessarily prohibit financial institutions from certain actions, though. It is essentially a law that requires financial institutions to disclose important data, not only to regulatory authorities but to the public.

 

HMDA requires institutions to provide information to the public, allowing the people who live in a community to assess whether the institution is actually serving that community. A 1989 amendment to the law requires institutions to also provide information about the characteristics of borrowers and applicants. This information is used to ensure that lenders are not discriminating against certain individuals in their lending practices and is also used to enforce anti-discrimination laws.

 

HMDA and other banking regulations are an important part of the banking industry. And that’s why the understanding of regulations is important to compliance training. If you’re looking for compliance training for your financial institution, Contact us today for more information.

  

 

 

What Kind of Training is Out There and Who Needs It?

 

 What Kind of Training is Out There and Who Needs It?  

It’s easy to assume that only certain industries need to train their employees. It’s definitely a necessity for certain lines of work, especially government-regulated industries with specific compliance training needs. Other businesses may be mandated to use training courses, though. But what kind of training is out there?

Financial Industry Compliance Training

One of the major reasons that certain businesses need compliance training is because the government requires it for that industry. A good example of this would be banks and other financial institutions. These financial institutions have to train employees and executives alike. The government requires these institutions to train their employees in specific and general areas. Some of the training required can be about in-depth financial regulations and other training may be simpler but just as vital. For example, training a bank teller to spot potential warning signs of fraud is just as important as a bank’s officers knowing about the latest regulations regarding loans.

HR Compliance Training

Another type of training often required or, at least, recommended by government bodies is HR compliance training. This type of training often focuses on teaching employees and executive about diversity, sexual harassment, discrimination, and similar issues in the workplace. There’s no single industry that uses this type of training. Many businesses, even federal and local governments require their employees to take this type of training. Even if it’s not required by law, many businesses make it part of their own initiatives to use this kind of training. There are very few industries that couldn’t benefit from a better understanding of ethical issues in the workplace.

Professional Skills Training

Outside of required training, many businesses use courses to teach their staff important professional skills. Professional skills training is often an important part of the onboarding process for many businesses. This type of training isn’t usually mandated by government bodies but can definitely help a business hone their employee’s skills and teach them valuable lessons about everything from anger management to answering calls.

Your Source

If you’re interested in financial compliance training, HR compliance training, or professional skills training for your business, Banker’s Academy can help. With a focus on the financial industry, we stay abreast of the latest in banking regulations and compliance requirements and can provide you with relevant and thorough training for your institution. Contact us today for more information.

  

 

 

September 2019 - Compliance Alert

The Consumer Financial Protection Bureau (CFPB)

CFPB Plans to Enhance Consumer Complaint Database

The Consumer Financial Protection Bureau announced it would continue to publish consumer complaints and that it would enhance the information that’s available to those who use the database. The CFPB will also improve the database itself, including dynamic visualization tools on more recent complaints.

Office of the Comptroller of Currency (OCC)

OCC to Hold Compliance and Operational Risk Workshops in LA

The Office of the Comptroller of the Currency will hold two workshops in Los Angeles on October 22 and 23. The workshops, held at the Federal Reserve Bank of Los Angeles, will be for national community bank and federal saving association directors. The workshops will focus on compliance, risks, and major regulations.

Securities and Exchange Commission (SEC)

SEC to Update Statistical Disclosures

The Securities and Exchange Commission announced that it had proposed rule changes to update the statistical disclosures that some institutions must provide to investors. The changes would get rid of some disclosures, eliminating overlap with some SEC rules.

Once published in the Federal Register, there will be a sixty-day public comment period.

The Federal Deposit Insurance Company (FDIC)

FDIC Releases Annual Survey Results

The Federal Deposit Insurance Committee announced the results of its annual branch office deposits survey. The survey included all FDIC-insured institutions as of June 30, 2019. The Summary of Deposits survey includes data that goes as far back as 1994. The survey collects deposit totals for thousands of institutions in the US.

National Credit Union Administration (NCUA)

NCUA Approves Three Final Rules

The National Credit Union Administration approved three final rules during its eighth 2019 open meeting. The NCUA approved the following:

  • Federal credit unions can offer additional alternative payday loans
  • Clarification of regulations regarding credit union supervisory committee audits and audit process flexibility
  • Finalization and simplification of federal credit union bylaws

 

 

 


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