Welcome to the Compliance Cohort. We are a group of compliance professionals working to make compliance easier. Our goal is to take complex compliance concepts and put them in simple terms that apply to the real world. We are glad you have found us and look forward to collaborating in the future.
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All in Fair Lending
In this Compliance Clip (video), Adam briefly explains what is fair lending and differences between the two main fair lending laws, Fair Housing Act (FHA) and Equal Credit Opportunity Act (ECOA). This video is actually an introduction to the program Fair Lending for Lenders which is available at our store. This video provides a lot of valuable information into understanding what fair lending is so feel free to share this video to your lending team.
On 11/16/21, the Consumer Financial Protection Bureau (CFPB) issued a Request for Information (RFI) to seek input on rules implementing the Home Mortgage Disclosure Act (HMDA). The CFPB plans to review recent changes to the rule and evaluate their effectiveness.
In this Compliance Clip (video), Adam provides a quick executive summary of the CFPB’s recent proposal to amend Regulation B, which will require small business data collection and reporting - much like HMDA - for many financial institutions. As this rule will have a significant impact on financial institutions, it is important to understand the direction this proposal is headed in regards to who might be required to report and what this rule is going to require. This video is a MUST WATCH for all compliance officer, senior lenders, and those who may be required to implement this new rule. (NOTE: Feel free to share this video with those in your team who may need to have this information as this video is free to all.)
On 10/22/21, the CFPB announced that it, along with the Department of Justice (DOJ) and OCC, took action to put an end to alleged redlining by Trustmark National Bank. The CFPB and DOJ allege that Trustmark discriminated against Black and Hispanic neighborhoods by deliberately not marketing, offering, or originating home loans to consumers in majority-Black and Hispanic neighborhoods in the Memphis metropolitan area. The CFPB and DOJ also allege that Trustmark discouraged consumers residing in or seeking credit for properties located in these neighborhoods from applying for credit.
On 10/22/21, the U.S. Department of Justice (DOJ) announced the launch of a new Combatting Redlining Initiative. The new Initiative represents the department’s most aggressive and coordinated enforcement effort to address redlining, which is prohibited by the Fair Housing Act and the Equal Credit Opportunity Act.
On 10/22/2021, the CFPB released the remarks of new CFPB Director Rohit Chopra at a Joint DOJ, CFPB, and OCC press conference on the Trustmark National Bank Enforcement Action. While describing the enforcement action (which we covered here), Mr. Chopra warned of “digital redlining.”
On 8/30/2021, the OCC and Department of Justice (DOJ) jointly announced an agreement to resolve allegations that Cadence Bank, which is headquartered in Atlanta, engaged in lending discrimination by “redlining” predominantly Black and Hispanic neighborhoods in the Houston, metro area. Under the department’s settlement, Cadence will invest over $5.5 million to increase credit opportunities for residents of those neighborhoods. In conjunction with this announcement, the OCC also announced that it has assessed penalties against the bank in the amount of $3 million related to the violations alleged in the department’s complaint.
On 8/5/2021, the OCC issued Bulletin 2021-35 to inform national banks, federal savings associations, and other applicable branches/organizations of the appropriate names and addresses for certain notices. Specifically, the Bulletin provides the current addresses needed on notices/posters required by the Community Reinvestment Act (CRA), Equal Credit Opportunity Act, and the Fair Housing Act. Banks should make the appropriate changes to their notices and posters, if necessary, within 90 days of this bulletin’s date of issuance.
On 7/1/2021, the Federal Housing Finance Agency issued a policy statement on Fair Lending to communicate the agency's general position on monitoring and information gathering, supervisory examinations, and administrative enforcement related to the Equal Credit Opportunity Act, the Fair Housing Act, and the Federal Housing Enterprises Financial Safety and Soundness Act. The FHFA is also soliciting comments on its application.
In this Compliance Clip, Adam takes a deep dive into the world of government monitoring information (GMI) under Regulation B. If your financial institution recently became exempt from HMDA and you now collect GMI only under Regulation B - or maybe you have always been a Reg B bank - then you will want to check out this video. Basically, Adam answers the long-asked question of: Is GMI required under Reg B on a loan that is refinancing a loan that was not purchase money?
