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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In this Compliance Clip (video), Adam talks about digital redlining. This is currently a hot topic as the regulators have been focusing their efforts on enforcing fair lending and redlining is one of the things they have been looking into. In this video, Adam describes how digital redlining often relates to disparate impact. A transcript of this video is now available.
On 1/26/2022, the CFPB launched an initiative to save households billions of dollars a year by reducing exploitative junk fees charged by banks and financial companies. This initiative will give the public a chance to share their input in crafting the agency’s rulemaking and guidance agenda, as well as its enforcement priorities in the coming months and years.
On 1/24/2022, the FinCEN issued a Notice of Proposed Rulemaking (NPRM) that proposes and solicits public comment on the establishment of a limited-duration pilot program for sharing suspicious activity reports (SARs), in accordance with Section 6212 of the Anti-Money Laundering Act of 2020. In the pilot program, a financial institution with a SAR reporting obligation would be permitted to share SARs and information related to SARs with foreign branches, subsidiaries, and affiliates for the purpose of combating illicit finance risks, provided FinCEN approves and approves the conditions.
On 1/21/2022, the Federal Financial Institutions Examination Council issued a statement announcing best practices for requesting examination information from supervised entities, and a common authentication solution for secure access to the FFIEC members’ supervision systems. According to FFIEC’s release, the statement presents the results of the final phase of the Examination Modernization Project in which its members addressed the feedback provided by supervised entities regarding examination requests and authentication requirements for its members’ supervision systems.
On 1/21/2022, the FDIC approved a final rule to simplify aspects of the agency’s deposit insurance coverage rules. In particular, deposit insurance coverage for deposits held in connection with irrevocable and revocable trusts is simplified by combining these two deposit insurance categories under one simpler and common calculation.
On 1/20/2022, the CFPB announced that it will begin examining the operations of post-secondary schools, such as for-profit colleges, that extend private loans directly to students. In line with this, the CFPB has updated its exam procedures to include a new section on institutional student loans.
On 1/20/2022, the Federal Reserve Board released a discussion paper that examines the pros and cons of a potential U.S. central bank digital currency, or CBDC. The Board invites comment from the public as the first step in a discussion of whether and how a CBDC could improve the safe and effective domestic payments system.
In this Compliance Clip (video), Adam answers a unique question about listing inquiries as a factor in the adverse action notices. Specifically, the question is whether or not creditors are required to include the number of inquiries in the list of factors affecting the credit score if it is the fifth key factor. The answer to this question will come from the FCRA and Regulation B, but specifically from the preamble to the July 15, 2011 Regulation B final rule. A transcript of this video is now available.
On 1/13/2022, the Federal Trade Commission (FTC) issued a press release that Dun & Bradstreet (D&B) has agreed to an order requiring substantial changes in the firm’s operations that will benefit small- and mid-sized businesses. This is in response to FTC’s charges that D&B engaged in deceptive and unfair practices by deceiving businesses about value of products and failing to correct errors on business credit reports.
On 1/14/2022, the CFPB issued an article regarding discrimination based on their religious beliefs. The blog post, authored by Lorelei Salas, emphasizes that it is illegal to penalize borrowers for being religious. In the blog post, the CFPB also expressed its concern about how financial institutions might be making use of artificial intelligence and other algorithmic decision tools such as uses third-party data to analyze geolocation data to power their credit decision tools.
