Weekly Rewind...News from Your Regulators

The 2023 CSG Audit calendar is now open!!!

Contact us to schedule your 2023 Regulatory Compliance Reviews. Visit our website at complianceservicesgroup.com or email our Lead Auditor directly at [email protected].

NCUA Issues Prohibition Order

Prohibition Orders – The NCUA issued prohibition orders on two former credit union employees. One was for misapplication and embezzlement from a credit union and uttering counterfeit US currency, and the other was for fraud in connection with his employment at a credit union.  

From the CFPB

Credit Card Fees - The CFPB issued a Notice of Proposed Rulemaking related to late fees for credit card products. The Proposed Rule would amend Regulation Z to (1) adjust the safe harbor dollar amount for late fees to $8 and eliminate a higher safe harbor dollar amount for late fees for subsequent violations of the same type; (2) provide that the current provision that provides for annual inflation adjustments for the safe harbor dollar amounts would not apply to the late fee safe harbor amount; and (3) provide that late fee amounts must not exceed 25 percent of the required payment.

The proposal also seeks comment on other potential changes to CARD Act regulations. For instance, it requests comment on whether the CFPB’s proposed changes should apply to all credit card penalty fees, whether the immunity provision should be eliminated altogether, whether consumers should be granted a 15-day courtesy period, after the due date, before late fees can be assessed, and whether issuers should be required to offer autopay in order to make use of the immunity provision.

Treasury Check Verifications

Treasury Check Verifications - The Department of the Treasury is proposing to amend its regulations governing the payment of checks drawn on the United States Treasury. Specifically, to prevent Treasury checks from being negotiated after cancellation by Treasury or a payment certifying agency—also known as payments over cancellation (POCs)—Fiscal Service is proposing amendments that would require financial institutions use the Treasury Check Verification System (TCVS), or other similar authorized system, to verify that Treasury checks are both authentic and valid. This proposal also contains conforming amendments, including the addition of a definition of “cancellation” or “canceled.” Finally, the proposal would amend the reasons for which a Federal Reserve Bank must decline payment of a Treasury check to include prior cancellation of the check, so that Fiscal Service may place what is commonly referred to as a “true stop” on a Treasury check and avoid a POC. 

FDIC Updates RMS Manual

Updated RMS Manual – The FDIC updated Section 3.6 – Other Real Estate of its Risk Management Manual of Examination Policies. Updates include revisions for relevant accounting changes related to foreclosed real estate, with a focus on seller-financed other real estate, as well as other technical edits.

From the OCC, NCUA, FDIC

HMDA: Loan Origination Threshold Changes – The agencies (OCC, FDIC, NCUA) issued alerts informing institutions that the loan origination threshold for reporting Home Mortgage Disclosure Act (HMDA) data on closed-end mortgage loans has changed. Due to a recent court decision, the threshold for reporting is now 25 closed-end mortgage loans originated in each of the two preceding calendar years.

Federal Reserve Issues Supervision Policy

Federal Reserve Policy Statement - To promote a level playing field for all banks with a federal supervisor, regardless of deposit insurance status, the Federal Reserve issued a policy statement stating that all banks supervised by the Federal Reserve will be subject to the same limitations on activities, including novel banking activities like crypto-asset-related activities – regardless of their deposit insurance status. The statement reiterates that banks must both ensure that the activities they engage in are allowed under the law, and conduct their business in a safe and sound manner. For instance, a bank should have in place risk management processes, internal controls, and information systems that are appropriate and adequate for the nature, scope, and risks of its activities.

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