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What's New?

The Online Compliance Consulting Dashboard has been enhanced!


Small Business Lending Data Collection


Effective Date for Reg. B Small Business Data Rule, Third Party Risk Guidance, FDIC Updated Guidance on Multiple Re-Presentments


Interagency Guidance on Third-Party Relationships


Reg. B Small Business Rule, FDIC Multiple Re-Presentments Guidance


2Q Be Prepared! Slide Deck & Webinar Recording - Exploring Emerging Issues in BSA/AML


Visit for more information.

Calendar Items

06/06 - Interagency Guidance on Third-Party Relationships

06/16 - FDIC Revised Guidance on Multiple Re-Presentments Released

06/22 - Be Prepared! 2Q Compliance Webinar - BSA/AML

06/23 - FDIC Fair Housing / Equal Housing Rule Effective

07/01 - FRB Regulation II Amendment Effective

Featured Content

New Appraisal-Related Issuances

Our readers may recall prior articles included in our newsletter on the topic of appraisals. Most recently, our February 2023 article, “Combatting Bias in Appraisals,” highlighted a variety of actions and issuances related to the topic. As noted therein, we encourage our clients to remain cognizant of ongoing developments in this area. 

What's currently happening?


In keeping up with this topic, institutions should be aware of two issuances that came out earlier this month: 

  • Interagency Guidance on Reconsiderations of Value of Residential Real Estate Valuations Proposed
  • Quality Control Standards for Automated Valuation Models (AVMs) Proposed


What does the Proposed Interagency Guidance on Reconsiderations Say?


This interagency guidance was issued by the CFPB, FRB, FDIC, NCUA, and OCC. It is currently proposed and includes a request for comment, which will remain open for 60 days after publication in the Federal Register.  


As the name of the guidance implies, the focus of the proposal is on reconsiderations of value (ROV) for real estate transactions. ROV refers to a request from an institution to an appraiser to reassess the value of residential real estate. It is aimed at highlighting risks tied to deficient residential real estate valuations and clarifies how an institution can establish ROV processes into their risk management practice.


While some of the agencies have previously issued guidance related to steps an institution may take to correct deficiencies in valuations, they collectively did not have existing guidance specific to ROVs. Besides providing some background and information on applicable statutes, regulations, and guidance, an important component of the new issuance is focused on providing examples of policies, procedures, and control systems that will identify and mitigate risk of deficient valuations. 


Institutions are encouraged to review the proposal and consider providing comment. 

What do the Proposed Quality Control Standards for AVMs Say?


This proposed rulemaking was issued by the CFPB, FRB, FDIC, FHFA, NCUA, and OCC. It includes a request for comment, which will remain open through August 21, 2023.


The rulemaking is tied to the Dodd-Frank Act and a mandate to implement quality control standards for the use of AVMs by mortgage originators when determining the value of collateral.  An AVM refers to any computerized model used by mortgage originators and secondary market issuers to determine the value of a consumer’s principal dwelling collateralizing a mortgage. Quality Control Standards refers to the adoption of policies, practices, procedures, and control standards to ensure the AVM used is designed to ensure confidence in results, protect against data manipulation, avoid conflicts of interest, require random sampling, and comply with nondiscrimination laws.


While the FRB, FDIC, NCUA, and OCC have already provided some guidance on the use of AVMs in Appendix B to the Interagency Appraisal and Evaluation Guidelines, and in other resources, the new rulemaking is designed to be reflected within an agency’s existing regulation. For example, the FDIC’s Appraisal regulation 12 CFR 323 is proposed to be amended with 323.15, 323.16, and 323.17, which addresses scope, definitions, and quality control standards. 


Institutions are encouraged to review the proposed rulemaking and consider providing comment.  

Ask the Regulators about Third-Party Risk

In recent news, the Federal Reserve, FDIC, and OCC published final guidance on managing risks associated with third-party relationships. Financial institutions supervised by these agencies should be aware that this new guidance replaces each agency’s prior general guidance on the topic.


Don’t be complacent!


The implementation of effective third-party management and governance practices is an important component of overall risk management for financial institutions. As related issuances come out in the form of guidance, versus regulatory amendments, it is an area that can sometimes be overlooked. However, this update reinforces the importance of managing this type of risk.


Institutions that are supervised by the Federal Reserve, FDIC, and OCC are strongly encouraged to review the updated guidance, which was published in the Federal Register and noted as being final as of June 6, 2023. Those institutions should pay particular attention to the variety of factors and considerations related to the life cycle of third-party relationships. Internal policies and practices should be adjusted as needed to coincide with the new guidance.


The agencies are offering an “Ask the Regulatorswebcast next month, on July 26th to provide additional information on this important topic. Interested persons can find a registration page for the webcast here. The published final interagency guidance can be found here

World Elder Abuse Awareness Day

World Elder Abuse Awareness Day has been commemorated on June 15th, going back to 2006. It is during the month of June that those of us in the financial industry see news articles, other issuances, and related resources cross our desks that remind us of this critical topic. 


As an important reminder, we encourage institutions to review FinCEN’s Advisory on Elder Financial Exploitation that was issued in June 2022.  It provides 15 pages of information on common typologies, case studies, red flags, SAR reporting, and use of FinCEN’s Rapid Response Program (RRP).

A new resource focused on elder financial exploitation was recently released by the ABA Foundation and the FBI, which provides information to assist institution employees in detecting and preventing elder harm. As noted in the release, “victims reported more than $3.1 billion in losses from elder financial abuse in 2022, which represents an 84% increase from 2021, according to the FBI.” Interested persons may find information on this new resource here.


Also, the CFPB provides resources for practitioners on working with older adults here.


We encourage institutions to communicate with employees about this important topic and to provide refresher training on the red flags that they should look for in order to detect this abuse.  

1071 Policy Guidance

Just in case you missed it…besides the issuance of the Reg. B Small Business Lending Data Collection rule, the CFPB issued separate policy guidance informing financial institutions of their enforcement plans. 


As shared in the issuance:


“This policy guidance informs covered financial institutions that the CFPB intends to focus its supervisory and enforcement activities in connection with the new rule in particular on ensuring that covered lenders do not discourage small business loan applicants from providing responsive data, including responses to lenders’ ECOA-mandated demographic data requests.”


The guidance supports the CFPB’s stance that compliant lenders will seek to maximize the collection of applicant information and will work toward minimizing missing or erroneous data. In our opinion, the main takeaway here is to, when applicable, review applicant response rates to requests for data and as needed, take appropriate steps to increase data collection. A high rate of responses of “I do not wish to provide this information” may be indicative of improper interference or discouragement. 


Interested persons may find the CFPB’s issuance here.  

Convenient and Affordable Compliance Assistance

Do you know someone that needs help preparing for the upcoming regulatory requirements? As you know, we can help with our Online Compliance Consulting Services, which combines the ease of online tools with the guidance of a compliance expert.


Clients have access to an online compliance expert who:

  • Answers compliance questions;
  • Reviews new policies and disclosures for compliance; and
  • Trains Boards of Directors on upcoming regulatory requirements.


Clients also receive access to our online tools, including:

  • Our Compliance Calendar;
  • Our Regulatory Deadline resources and Implementation Checklists enable our clients to determine what steps they need to take to comply with new requirements and track progress as they implement them;
  • Our exclusive Knowledge Base of compliance Q&As; and
  • FREE access to our quarterly Be Prepared! webinar series.


For anyone interested in a free Demo, please have them contact Rhonda Coggins at 

(512) 703-1509.