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 discusses what lenders must do if there is a discrepancy between the flood determination and the declaration page. While the industry has long understood one answer to this question, the May 2022 Flood Q&A’s made some significant changes to what is expected when there is a discrepancy between the declaration page and flood determination. Therefore, Adam discusses the applicable Flood Q&A’s as well as how FEMA 2.0 has impacted the answer to this question.
On August 11, 2022, the FTC issued an alert warning consumers of scammers demanding utility payments in cryptocurrency. According to the FTC, utility scams are increasing where scammers pretend to be a utility company threatening to immediately turn off a consumer’s service. The latest twist on utility scams is asking consumers to pay in Bitcoin or another type of cryptocurrency.
On August 11, 2022, the CFPB published a circular confirming that financial companies may violate federal consumer financial protection law when they fail to safeguard consumer data. The circular provides guidance to consumer protection enforcers, including examples of when firms can be held liable for lax data security protocols. According to the CFPB, financial companies are at risk of violating the Consumer Financial Protection Act if they fail to have adequate measures to protect against data security incidents.
On August 10, 2022, the CFPB issued an interpretive rule laying out when digital marketing providers for financial firms must comply with federal consumer financial protection law. According to the CFPB, digital marketers acting as service providers can be held liable for committing unfair, deceptive, or abusive acts or practices as well as other consumer financial protection violations.
On August 10, 2022, the CFPB filed a consent order against Hello Digit, LLC for using a faulty algorithm that caused overdrafts and overdraft penalties for customers. According to the CFPB, the financial technology company falsely guaranteed no overdrafts with its product, broke its promises to make amends on its mistakes, and pocketed a portion of the interest that should have gone to consumers.
On August 9, 2022, the Federal Reserve System published its Consumer Compliance Outlook Second Issue 2022. Consumer Compliance Outlook is the agency’s publication focusing on consumer compliance topics.
Early in August 2022, the CFPB announced that it will host events wherein it will conduct technical conversations about software used by financial institutions to facilitate compliance with the CFPB’s small business lending rulemaking. The Bureau will conduct two events - the first is a virtual meeting on August 19, 2022 and the second one is an in-person meeting on September 15, 2022. The same materials will be covered at both.
In this Compliance Clip (video), Adam discusses the changes that are included in the May 2022 Interagency Questions and Answers Regarding Flood Insurance. Of course, there were many different changes as these revisions are the first in over a decade that saw many law and rule changes related to flood insurance.
On August 3, 2022, the FDIC published its Supervisory Insights, Summer 2022 Edition. The FDIC’s Supervisory Insights is published by the Division of Risk Management Supervision to promote sound principles and practices for bank supervision.
On August 2, 2022, the Acting Comptroller of the Currency Michael J. Hsu spoke at the joint meeting of the FBIIC and FSSCC where he discussed cybersecurity risks facing the financial sector. In his remarks, Hsu talked about the three intersecting risks that he believes the financial industry should pay attention to - the risk of evolving cybersecurity threats, the risk to critical operations, and the risk of complacency.
