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 the importance of a well designed Compliance Management System (CMS) and explains what the goal should be for a CMS. Maybe even more importantly, Adam explains what he considers a key element needed to be able to have an effective CMS. The video concludes with an explanation about how our premium memberships can assist financial institutions in implementing and managing their Compliance Management Systems.
In this Compliance Clip (video), Adam provides a quick executive summary of the CFPB’s recent proposal to amend Regulation B, which will require small business data collection and reporting - much like HMDA - for many financial institutions. As this rule will have a significant impact on financial institutions, it is important to understand the direction this proposal is headed in regards to who might be required to report and what this rule is going to require. This video is a MUST WATCH for all compliance officer, senior lenders, and those who may be required to implement this new rule. (NOTE: Feel free to share this video with those in your team who may need to have this information as this video is free to all.)
On 9/23/21, the Consumer Financial Protection Bureau (CFPB) released its first in-depth report analyzing complaint submission patterns by U.S. Census tract. The report, “Consumer complaints throughout the credit life cycle, by demographic characteristics,” finds that the complaints from wealthier communities and communities with higher percentages of white, non-Hispanic residents were more frequently about loan origination and performing servicing, while the complaints from communities of color and lower income communities were more frequently about credit reporting, identity theft, and delinquent servicing.
On 7/13/21, the joint agencies (Federal Reserve, FDIC, & OCC) announced a request for public comment on proposed guidance designed to help banking organizations manage risks associated with third-party relationships, including relationships with financial technology-focused entities. Comments must be received within 60 days of the proposed guidance's publication in the Federal Register.
In February of 2021, the FFIEC released the second round of what appears to be an overhaul of the BSA/AML Exam Manual. The February 2021 revisions include updates to four sections including and introduction section to the section on assessing compliance with BSA regulatory requirements, and sections on customer identification programs, currency transaction reporting, and transactions of exempt persons.
On 2/2/2021, the NCUA announced that they will be hosting a webinar on Thursday, February 11, 2021, that will provide participants with an update on Chairman Todd M. Harper’s priorities, the agency’s supervisory activities, and recently issued guidance and regulations, among other topics. As some may recall, Chairman Harper was announced on 1/25/2021 as President Biden’s designated Chairman of the NCUA Board. Harper is also the NCUA director who, in October of 2020, requested comments regarding the NCUA’s approach to supervising institutions for regulatory compliance. In the announcement about the upcoming webinar, Mr. Harper is quoted as saying that he will share his “regulatory philosophy” with stakeholders during this webinar. Credit union compliance professionals may want to consider taking part in this webinar as it may shed some light on the direction of regulatory compliance supervision and enforcement from the NCUA going forward.
On 1/25/2021, the NCUA announced that President Biden had designated National Credit Union Administration Board Member Todd M. Harper as the twelfth Chairman of the NCUA Board. Harper succeeds Rodney Hood, who was designated Board Chairman in April 2019. Hood continues to serve as an NCUA Board Member. Harper was nominated to the NCUA Board on Feb. 6, 2019. Following Senate confirmation, he took office as an NCUA Board Member on April 8, 2019. As some might recall, it was Mr. Harper who, in October of 2020, requested comments regarding the NCUA’s approach to supervising institutions for regulatory compliance.
On 1/19/2021, the joint agencies (CFPB, Federal Reserve, FDIC, OCC, and NCUA) a final rule regarding the agencies use of supervisory guidance for its supervised institutions. The rule codifies the statement, with amendments, that the joint agencies issued in September 2018, which clarified the differences between regulations and supervisory guidance.
On 11/9/2020, the OCC published their fall 2020 edition of the publication, Semiannual Risk Perspective. In their release, the OCC explains that Banks remain in strong financial condition but profitability is stressed due to low interest rates and increasing levels of provisions for problem loans. As would be expected, the OCC identified credit, strategic, operational, and compliance risks as key themes for financial institutions.
On October 7, 2020, the Office of the Comptroller of the Currency (OCC) announced that they had assessed a $400 million civil money penalty (CMP) against Citibank due to deficiencies in enterprise-wide risk management, compliance risk management, data governance, and internal controls. In their release, the OCC explained that these measure were taken “based on the bank’s unsafe or unsound banking practices for its long-standing failure to establish effective risk management and data governance programs and internal controls.”
In this Compliance Clip (video), Adam answers a question about cashing checks made out to a business for an individual. In addition, Adam addresses situations where a check made out to a business may be deposited into an account of an individual.
On 7/16/2020, the CFPB issued an updated complaint bulletin on complaints from January through May of 2020 which mentioned “coronavirus” or coronavirus-related terms. Highlights of complaints about these consumer financial products and services that mention coronavirus key words:
In this Compliance Clip (video), Adam explains how regulatory change management should fit within a compliance management system (CMS) of a financial institution. Specifically, Adam provides 3 (or 4) main ways a financial institution can keep up with regulatory changes (and one of them involves…
On 7/1/2020, the Federal Financial Institutions Examination Council (FFIEC) issued a statement to highlight the risks that will result from the transition away from LIBOR, which is used by the financial industry as a reference rate for many products and instruments like loans, investments, and deposits. In their release, the regulators encouraged financial institutions to continue working toward a transition to alternative reference rates so that financial, legal, operational, and consumer protection risks can be mitigated. While the transition away from the LIBOR will affect some institutions more than others, the regulators state that the impact will affect almost all institutions and, therefore, it would be beneficial for all financial institutions to consider the risks associated with the LIBOR transition.
In this Compliance Clip (video), Adam provides an overview of what should be included in a financial institution’s compliance management system (CMS). In addition, Adam explains what a CMS should do within an organization and also provides more resources for those who are interested.
On 5/26/2020, the OCC issued Bulletin 2020-55 to clarify that national banks and federal savings associations may permit telephonic and electronic participation at all board of directors, shareholder, and, as applicable, member meetings.
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…
On March 6, 2020, the Federal Financial Institutions Examination Council updated guidance identifying actions that financial institutions should take to minimize the potential adverse effects of a pandemic. The guidance provides the FFIEC’s expectations that regulated institutions should periodically review related risk management plans, including continuity plans, to ensure their ability to continue to deliver their products and services in a wide range of scenarios and with minimal disruption.
On January 23, 2020, the Office of the Comptroller of the Currency (OCC) issued a notice of charges against five former senior executives of Wells Fargo Bank, N.A., Sioux Falls, South Dakota, and announced settlements with the bank’s former Chief Executive Officer (CEO) and other members of the bank’s operating committee - including the former chief auditor, a former risk officer, former general counsel, and a former executive audit director.
This notice of charges is of particular interest to compliance and audit professionals as risk managers, auditors, and general counsel don’t typically appear in these types of charges.
The notice of charges alleges these executives…
In this Compliance Clip (video), Adam discusses the role of a compliance management system. Specifically, Adam explains what a compliance management system should accomplish in an organization.
Adam uses this Compliance Clip (video) to review the annual compliance training requirements for directors - or lack thereof. That said, there are a few expectations regulators have had for director training, and Adam explains some of these topics and reminds viewers of a few annual reports that do need to go to the board.
The CFPB has released the summer 2019 Edition of Supervisory Highlights. In this issue, topics include UDAAPs, auto loans, Supervision, compliance, credit cards, credit reports and scores, debt collection, Fair Credit Reporting Act, mortgage origination. The full version of Supervisory Highlights can be found here.
As you might expect, we will be coving the portions of Supervisory Highlights that relate to compliance professionals in our next Quarterly Compliance Update. You can view the tentative curriculum for our Q3 2019 Quarterly Compliance Update here.
This is a guest post by one of our Cohort members, Theresa Zuber. Theresa is the VP/Compliance Officer at a $450 million community bank and shares her years of experience in banking by providing us with an example of things to consider in building and designing a compliance management system. ——
Between policy reviews, risk analysis, board reporting, annual training, complaint tracking and documentation for examiners, it can be difficult to keep track of all the individual tasks and responsibilities found within a Compliance Management System (CMS). In fact, keeping a CMS going can sometimes feel more like a juggling act than banking. Therefore, we have the following Compliance Management System example to give you the framework you need to take control of your Compliance duties and ensure nothing slips through the cracks.
In this Compliance Clip, Adam uses his years of presenting live compliance seminars to share with you six tips for making your annual day of training go well - especially if you are involved in the training or preparation. In addition to the six tips, be sure to pay attention for a few extra nuggets (like how important good food is in making a successful training day).
In this Compliance Clip (video), Adam provides three different ways to present compliance training to a financial institution’s board of directors. In addition to three different ways for providing board training, Adam gives a few tips that can be used when delivering board training.
In this Compliance Clip (video), Adam answers a question regarding whether Member FDIC must be included in a Radio ad. As you will see, the answer to this is quite complex and Adam breaks the answer down in simple, easy-to-understand, layman’s terms. This video clip includes a transcript.
As we work to build careers in regulatory compliance, we often look for opportunities to become more valuable to our organizations and to establish ourselves as experts. While experience and self-learned technical expertise is a must for any compliance professional, finding a way to be recognized as an industry leader can help to establish credibility with both examiners and peers. One way to do this is to obtain a professional regulatory compliance certification. This article explores 3 options for obtaining a regulatory compliance certification.
On June 12, 2019, the Federal Housing Finance Agency (FHFA), Fannie Mae, and Freddie Mac announced that the optional use period for the redesigned Uniform Residential Loan Application (URLA) form has been delayed again. It was planned that the redesigned URLA could be used starting on July 1, 2019 with required use by January 1, 2020. This announcement delays the optional use period for the new URLA, meaning that lenders should not yet begin using this form.
The Certified Regulatory Compliance Manager (CRCM) certification is one of the most respected and well recognized certifications for a banking compliance professional. This respect and recognition doesn’t come just because the CRCM is earned through the American Bankers Association (ABA) - or because many of the top compliance professionals and consultants have this certification. The CRCM certification is a valued credential because of the difficulty to obtain the designation, meaning that not just anyone can obtain their CRCM.
To explain, the difficulty of the CRCM certification results from four main things: experience qualifications, knowledge of content, taking the actual test, and maintaining the certification.
