All in Regulatory Update

FDIC Consumer Compliance Supervisory Highlights March 2021 Edition

Adam Witmer
Regulatory Update

On 3/31/2021, the FDIC issued a release (FIL-22-2021) to explain that the latest edition of their Consumer Compliance Supervisory Highlights had been published. The purpose of this publication is to provide insight regarding the FDIC’s consumer compliance supervisory activities and provide a high-level overview of consumer compliance issues identified in 2020 through the FDIC’s supervision of state non-member banks and thrifts. Topics include a summary of the FDIC’s supervisory approach in response to COVID-19, supervisory observations related to consumer protection laws, examples of practices that may be useful to institutions in mitigating risks, regulatory developments, and consumer compliance resources.

Request for Information on AI Use

Adam Witmer
Regulatory Update

On 3/29/21, the Federal Reserve, CFPB, FDIC, NCUA, and OCC jointly released a “Request for Information” to gather insight on financial institutions’ use of artificial intelligence (AI). In their release, the agencies explain that they are seeking information from the public on how financial institutions use AI in their activities, including fraud prevention, personalization of customer services, credit underwriting, and other operations.

CFPB 2020 Report on Complaints Received

Adam Witmer
Regulatory Update

On 3/24/2021, the CFPB announced their 2020 Consumer Response Annual Report to Congress. In their release, the CFPB explains that complaints increased in 2020 due to the impact of the COVID-19 pandemic on the consumer financial marketplace. The CFPB reported handling approximately 542,300 complaints in 2020, which is nearly a 54% increase over the approximately 352,400 complaints handled in 2019.

CFPB Submits Debt Collection Report to Congress

Adam Witmer
Regulatory Update

On 3/22/21, the Consumer Financial Protection Bureau (CFPB) announced the release of its annual report to Congress on the administration of the Fair Debt Collection Practices Act. According to the CFPB’s release, the report highlights efforts by the CFPB and the Federal Trade Commission (FTC) to protect consumers, particularly those who have suffered profound financial impacts due to the COVID-19 pandemic. The CFPB explained that they, along with the FTC and state and federal partners, accomplished much toward stopping unlawful debt collection practices and continuing their vigorous law enforcement, consumer education and public outreach, and policy initiatives.

FATF to Update Guidance on Virtual Assets

Adam Witmer
BSA, Regulatory Update

On March 19, 2021, the Financial Action Task Force (FATF) announced plans to update its existing guidance on the risk-based approach to virtual assets (VAs) and virtual asset service providers (VASPs). The FATF originally published this Guidance in June 2019 when the FATF finalized changes to its Standards to clearly place anti-money laundering and countering the financing of terrorism (AML/CFT) obligations on VAs and VASPs. In July 2020, the FATF committed to update this Guidance as set out in its 12-month review report and report to G20 on so-called stablecoins.

FinCEN Advisory on Updated Deficient Countries

Adam Witmer
BSA, Regulatory Update

On 3/11/21, the Financial Crimes Enforcement Network (FinCEN) issued an advisory to inform financial institutions of updates to the FATF list of jurisdictions with strategic anti-money landing and combating the financing of terrorism and counter-proliferation financing deficiencies.

Remaining on the list are Albania, Barbados, Botswana, Burma (Myanmar), Cambodia, Ghana, Jamaica, Mauritius, Nicaragua, Pakistan, Panama, Syria, Uganda, Yemen, and Zimbabwe. The Bahamas were removed from the list while Burkina Faso, Cayman Islands, Morocco, and Senegal were all added to the list.

CFPB Rescinds Abusiveness Policy Statement from 2020

Adam Witmer
UDAAP, Regulatory Update

On 3/11/21, the CFPB announced that it is rescinding a policy statement that was just over a year old. Specifically, the CFPB has rescinded its January 24, 2020 policy statement titled “Statement of Policy Regarding Prohibition on Abusive Acts or Practices.” In their release, the CFPB explains that they intend to exercise its supervisory and enforcement authority consistent with the full scope of its statutory authority under the Dodd-Frank Act and these changes help to better protect consumers and the marketplace from abusive acts or practices.

FinCEN Guidance on Art Trade

Adam Witmer
BSA, Regulatory Update

On 3/9/21, the Financial Crimes Enforcement Network (FinCEN) issued a notice (FIN-2021-NTC2) to inform financial institutions about (1) the Anti-Money Laundering Act of 2020 (the AML Act)1 efforts related to trade in antiquities and art, (2) select sources of information about existing illicit activity related to antiquities and art, and (3) provide specific instructions for filing Suspicious Activity Reports (SARs) related to trade in antiquities and art. This release encourages financial institutions to continue filing SARs regarding these topics and provides additional guidance.

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