VIDEO: Example of a Deceptive UDAAP Violation

Adam Witmer

In this Compliance Clip (video), Adam provides an example of a “deceptive” UDAAP violation. This video runs under just 4 minutes and provides a bit of compliance “food” for the week. Be sure to watch each week in this Friday email for these short Compliance Clips that are provided to you for free, as a member of the Compliance Cohort.

FDIC Delays Efforts to Update Advertising of Membership Rules

Adam Witmer
Regulatory Update

On April 16, 2020, the FDIC announced it will temporarily postpone its efforts to modify its signage and advertising requirements, known as the advertising of membership rules. In their release, the FDIC explained that they remain committed to modernizing these rules at a future date to better reflect how banks and savings associations are transforming their business models to take deposits via physical branches, digital, and mobile banking channels.

NCUA Provides Appraisal Relief to Credit Unions

Adam Witmer
Appraisals, Regulatory Update

On April 20, 2020, the NCUA issued a final rule to provide appraisal relief to credit unions. The final rule does two main things. First, the final rule increases the residential appraisal threshold from $250,000 to $400,000. The raised threshold provides long-term regulatory relief to credit unions and members and aligns with the appraisal threshold adjustment that banking regulators made during 2019. The rule also increases flexibility for credit unions struggling with mortgage pipeline delays due to appraisals during the COVID-19 pandemic. Secondly, the NCUA has issued an interim final rule to temporarily allow credit unions to defer appraisals and written estimates of market value for up to 120 days after the closing of a loan. This flexibility will expire on December 31, 2020 and this, too, aligns with action taken by banking regulators. The NCUA explains that this deferral is intended to provide liquidity and relief to property owners affected by disruptions to property valuations caused by COVID-19 mitigation efforts. Both rules become effective upon publication in the Federal Register.

NCUA Temporarily Changes Regulatory Requirements for Credit Unions

Adam Witmer
Regulatory Update

On April 21, 2020, the NCUA published a temporary final rule in the Federal Register that modifies certain regulatory requirements to help ensure that federally insured credit unions remain operational and liquid during the COVID-19 crisis. Specifically, the NCUA is temporarily raising the maximum aggregate amount of loan participations that a credit union may purchase from a single originating lender to the greater of $5,000,000 or 200 percent of the credit union’s net worth. The NCUA is also temporarily suspending limitations on the eligible obligations that a federal credit union may purchase and hold. In addition, given physical distancing policies implemented in response to the crisis, the NCUA is tolling the required timeframes for the occupancy or disposition of properties not being used for federal credit union business or that have been abandoned.

OFAC Encourages Communication of COVID-19 Concerns

Adam Witmer
BSA, Regulatory Update

On 4/20/2020, OFAC issued a statement to encourage persons to communicate OFAC compliance concerns related to the coronavirus disease (COVID-19). Specifically, OFAC encourages persons, including financial institutions and other businesses, affected by the COVID-19 global pandemic to contact OFAC as soon as practicable if the person believes it may experience delays in its ability to meet deadlines associated with regulatory requirements administered by OFAC. This includes requirements related to filing blocking and reject reports within ten business days, responses to administrative subpoenas issued​, reports required by general or specific licenses, or any other required reports or submissions.

HMDA Thresholds Changed! - Final Rule Released

Adam Witmer
HMDA, Regulatory Update

On 4/16/17, the CFPB released the long-awaited final rule which changes the threshold of mortgage originations for both closed-end and open-end credit, which determines whether or not a financial institution is a HMDA reporter. The good news is that some HMDA reporters will no longer need to collect and report HMDA data, starting on July 1, 2020. Click here to see a summary of the changes…

Video: Increasing Reg CC Thresholds to Avoid 5 Year Adjustments

Video: Increasing Reg CC Thresholds to Avoid 5 Year Adjustments

Adam Witmer
Regulation CC

In this extended Compliance Clip (video), Adam take a little bit different approach to our Compliance Clips and discusses the pros and cons of increasing the Reg CC threshold amounts above and beyond the new mandated amounts, in attempts to avoid another required adjustment (and customer redisclosure) in 5 years, when the rule is set to again adjust for inflation. In other words, some financial institutions are considering increasing their hold amounts from $225 and $5,525 to something like $300 and $6,100 (watch the video to see where the $6,100 comes from) in order to avoid another adjustment in 5 years - but are these amounts enough?. This Compliance Clip takes a deep dive into the thought process some compliance professionals are taking to determine their course of action regarding the upcoming Reg CC changes. If you are a super-nerd when it comes to deposit compliance, this clip is for you.

FFIEC Announces APR & APY Calculation Tools

Adam Witmer
Regulation Z, Regulatory Update, Compliance Management

On April 2016, the FFIEC announced the availability of two new computational tools: one for calculating APY and one for calculating APR. According to the FFIEC, the APR Computational Tool is designed to streamline the process by which examiners and financial institutions can verify finance charges and annual percentage rates included on consumer loan disclosures subject to the Truth in Lending Act and its implementing regulation, Regulation Z. The FFIEC explains that…

NCUA Provides Regulatory Relief in Response to Coronavirus

Adam Witmer
Regulatory Update

On April 16, 2020, the NCUA approved several regulatory relief measures to assist credit unions during the COVID-19 pandemic including: 1). A temporary final rule granting measures of regulatory relief to help ensure that federally insured credit unions remain operational and liquid during the COVID-19 pandemic. 2) An interim final rule that temporarily defers real estate-related appraisals and evaluations under the agency’s appraisal regulations because the public health crisis and social distancing directives have created difficulties for lenders to obtain required appraisals on a timely basis. 3) A final rule that increases the threshold level below which appraisals would not be required for residential real estate-related transactions from $250,000 to $400,000.

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