All in Regulatory Update

FATF Guidance on Digital ID

Adam Witmer
BSA, Regulatory Update

On March 6, 2020, the Financial Action Task Force (FATF) released guidance relating to digital ID systems. In their release, the FATF explains that an understanding of how digital ID systems work is essential to apply the risk-based approach recommended in this Guidance. Specifically, FATF said the following

CFPB Takes Steps to Prevent Consumer Harm

Adam Witmer
Regulatory Update

On 3/6/2020, the CFPB announced three steps to advance its strategy on one of its key priorities: preventing consumer harm. In addition to these three steps, the CFPB presented proposed legislative language to Congress in hopes to establish a whistleblower award program to assist the CFPB in advancing enforcement cases, especially as it relates to fair lending violations. .

OCC FAQs on Third Party Relationships

Adam Witmer
Regulatory Update

On 3/5/20, the OCC issued updated frequently asked questions (FAQs) to to supplement a 2013 bulletin (2013-29) titled “Third-Party Relationships: Risk Management Guidance.” The new FAQs were issued to clarify the OCC’s existing guidance and reflect evolving industry trends. The new bulletin also rescinds OCC Bulletin 2017-21, “Third-Party Relationships: Frequently Asked Questions to Supplement OCC Bulletin 2013-29,” issued on June 7, 2017. The FAQs from OCC Bulletin 2017-21 have been…

Former U.S. Bank Risk Officer Fined for BSA Failures

Adam Witmer
BSA, Regulatory Update

On March 4, 2020, the Financial Crimes Enforcement Network (FinCEN) assessed a $450,000 civil money penalty against the former Chief Operational Risk Officer, Michael LaFontaine, at U.S. Bank for his failure to prevent BSA/AML violations during his time of employment. In their release, FinCEN explains that U.S. Bank used automated transaction monitoring software to spot potentially suspicious activity but improperly capped the number of alerts generated. In addition, FinCEN states that while under the former risk officer’s leadership, the bank failed to staff the BSA compliance function with enough people to review even the reduced number of alerts.

FinCEN explains that…

FTC Releases Annual ECOA Report

Adam Witmer
Regulatory Update

On February 21, 2020, the Federal Trade Commission (FTC) provided their annual Equal Credit Opportunity Act (ECOA) report to the CFPB. The FTC is responsible for ECOA enforcement and education regarding most non-bank financial service providers and the report describes the Commission’s work on ECOA-related issues, including activities addressed in research and policy development. The summary also outlines the Commission’s business and consumer education efforts on fair lending issues.

Wells Fargo Sales Abuse Results in $3 Billion Fine

Adam Witmer
Regulatory Update

On February 21, 2020, the Department of Justice announced an agreement where Wells Fargo Bank, N.A. will pay $3 billion to resolve their potential criminal and civil liability stemming from a practice between 2002 and 2016 of pressuring employees to meet unrealistic sales goals that led thousands of employees to provide millions of accounts or products to customers under false pretenses or without consent, often by creating false records or misusing customers’ identities.

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