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In this Compliance Clip (video), Adam talks about an amicus brief that the CFPB submitted to the courts regarding how Regulation Z applies to commercial loans. In particular, the opinion clarifies whether or not you can call a loan a “commercial loan” in order to exempt the loan from the requirements of Regulation Z. A transcript of this video is now available.
On November 7, 2023, the CFPB issued a notice of proposed rulemaking to supervise larger nonbank companies that offer services like digital wallets and payment apps. According to the CFPB, the rule proposed would ensure that these nonbank financial companies adhere to the same rules as large banks, credit unions, and other financial institutions already supervised by the CFPB.
On November 8, 2023, the CFPB ordered Citi to pay $25.9 million in fines and consumer redress for intentionally and illegally discriminating against credit card applicants the bank identified as Armenian American. According to CFPB Director Rohit Chopra, Citi purposefully discriminated against applicants of Armenian descent, primarily based on the spelling of their last name, and stereotyped Armenians as prone to crime and fraud. Chopra also said that Citi illegally fabricated documents to cover up its discrimination.
On November 7, 2023, FinCEN issued a final rule that specifies the circumstances in which a reporting company may report an entity’s FinCEN identifier in lieu of information about an individual beneficial owner. A FinCEN identifier is a unique number that FinCEN will issue upon request after receiving required information, which will can simplify the reporting process.
On November 6, 2023, FinCEN and the BIS issued a new SAR key term to support financial institutions in reporting potential efforts to evade U.S. export controls beyond the Russia-related circumstances that were the focus of those prior two alerts. The new joint notice builds on the success of the two prior alerts issued jointly by the two agencies in generating suspicious activity reporting related to Russia-related export control evasion.
On November 3, 2023, FinCEN issued a press release to inform U.S. financial institutions that the Financial Action Task Force (FATF), an intergovernmental body that establishes international standards to combat money laundering, counter the financing of terrorism, and combat weapons of mass destruction proliferation financing (AML/CFT/CPF), has issued public statements updating its lists of jurisdictions with strategic AML/CFT/CPF deficiencies following its plenary meeting last month. U.S. financial institutions should consider the FATF’s stance toward these jurisdictions when reviewing their obligations and risk-based policies, procedures, and practices.
In October 2023, the FDIC revised parts of its Risk Management Manual of Examination Policies. The FDIC conducts examinations to help ensure the stability of insured depository institutions by identifying undue risks and weak risk management practices.
On November 1, 2023, the OCC issued a bulletin to inform banks about policy guidance that applies to commercial loans to early-, expansion-, and late-stage companies, referred to as “venture loans.” The bulletin applies to all OCC-regulated banks, including community banks, that engage in or are considering engaging in venture lending.
On November 1, 2023, the OCC published the revised interagency examination procedures for the Telephone Consumer Protection Act (TCPA). The OCC, Federal Deposit Insurance Corporation, and the National Credit Union Administration have revised the interagency examination procedures to reflect amendments to the TCPA that became effective on October 25, 2021.
The Federal Reserve System recently published its Second/Third Issue of Consumer Compliance Outlook for 2023. Consumer Compliance Outlook is the agency’s publication focusing on consumer compliance topics.
