http://www.bankersonline.com/topstory/topstory.html - 02/01/15 05:45:51 - 11/30/04 17:07:27
January 30, 2015
- Bureau proposes more changes to mortgage rules The Consumer Financial Protection Bureau has several more proposed changes to its mortgage rules to facilitate responsible lending by small creditors, particularly in rural and underserved areas. If finalized, the latest proposal would increase the number of financial institutions able to offer certain types of mortgages in rural and underserved areas, and help small creditors adjust their business practices to comply with the new rules. The proposed amendments would:
The proposal would make several additional minor or technical changes to the rules. The proposed rule will be open for public comment until March 30, 2015.
- Expand the definition of "small creditor"
- Include mortgage affiliates in calculation of small-creditor status
- Expand the definition of "rural" areas
- Provide grace periods for small creditor and rural or underserved creditor status
- Create a one-year qualifying period for rural or underserved creditor status
- Provide additional implementation time for small creditors
- FHA offers reverse mortgage foreclosure alternative HUD has issued a press release to publicize FHA Mortgage Letter 2015-03, which announces a new policy under its Home Equity Conversion Mortgage (HECM) Program that gives FHA-approved lenders the option to delay calling HECMs with eligible "non-borrowing spouses" due and payable. A delay would postpone foreclosure normally triggered by the death of the last surviving borrower. FHA's new guidance will permit reverse mortgage lenders to assign eligible HECMs to HUD upon the death of the last surviving borrowing spouse, thereby allowing eligible surviving spouses the opportunity to remain in the home despite their non-borrowing status.
- Regulator guidance on private student loans A press release from the federal financial regulatory agencies (OCC, FRB, FDIC, NCUA and the CFPB), in partnership with the State Liaison Committee (SLC) of the Federal Financial Institutions Examination Council, announces the issuance of guidance for financial institutions on private student loans with graduated repayment terms at origination. The guidance provides principles that financial institutions should consider in their policies and procedures for originating private student loans with graduated repayment terms. The OCC also issued Bulletin 2015-7 on the subject.
- FRB proposes raising small BHC threshold The Federal Reserve Board has the issuance of a notice of proposed rulemaking (NPR) that would raise the asset size threshold for determining applicability of the Board's Small Bank Holding Company Policy Statement (Regulation Y, Appendix C) to $1 billion from $500 million and to expand the scope of the Policy Statement to include savings and loan holding companies that also meet the Policy Statement's requirements. Revisions to Reg Y, Reg LL and reporting requirements are also proposed. In addition, the proposal would eliminate quarterly consolidated financial reporting requirements (FR Y-9C) for bank holding companies and savings and loan holding companies that have less than $1 billion in total consolidated assets and meet the qualitative requirements of the Policy Statement, and instead require parent-only financial statements (FR Y-9SP). The proposal would also eliminate regulatory capital reporting for savings and loan holding companies with less than $500 million in total consolidated assets from the FR Y-9SP. Comments on the regulatory reporting changes will be accepted for 60 days after publication in the Federal Register.
- OCC Bulletin on credit risk retention requirements The OCC has issued Bulletin 2015-8 on the previously announced and published Final Rule to implement the credit risk retention requirements of section 15G of the Securities Exchange Act of 1934 (15 USC 78o-11), as added by section 941 of the Dodd-Frank Act. The Final Rule was previously issued and published in the Federal Register [79 FR 77601] by the OCC, FRB, FDIC, SEC, FHFA, and HUD on December 24, 2014 and reported in BOL Top Stories.
- CFPB looking for ways to help student loan borrowers The Bureau Blog features an article reviewing the plight of students who are struggling to manage their student loan debt. The text contains links to various resources that may be of assistance.
- December mortgage interest rates decline slightly
The Federal Housing Finance Agency (FHFA) has released its December 2014 Index, which indicates, according to several indices of new mortgage contracts, nationally interest rates on conventional purchase-money mortgages decreased from November to December 2014.
- NCUA webinar on underserved market opportunities
The NCUA will host a webinar, "Opportunities in the Underserved Market," on February 18, beginning at 2 p.m. ET.
January 29, 2015
- FDIC encourages risk-based approach to customer assessments FDIC FIL-5-2015 was issued Wednesday to encourage supervised institutions to take a risk-based approach in assessing individual customer relationships, rather than declining to provide banking services to entire categories of customers without regard to the risks presented by an individual customer or the financial institution's ability to manage the risk. The agency included a statement that (1) it is aware that some institutions may be hesitant to provide certain types of banking services due to concerns that they will be unable to comply with the associated requirements of the Bank Secrecy Act (BSA), and (2) the FDIC and the other federal banking agencies recognize that as a practical matter, it is not possible for a financial institution to detect and report all potentially illicit transactions that flow through an institution. Isolated or technical violations, which are limited instances of noncompliance with the BSA that occur within an otherwise adequate system of policies, procedures, and processes, generally do not prompt serious regulatory concern or reflect negatively on management's supervision or commitment to BSA compliance. A new, dedicated toll-free number, 800-756-8854, and dedicated email box (bankingservicesOO@fdic.gov) for the Office of the Ombudsman, have been established for institutions concerned that FDIC personnel are not following FDIC policies on providing banking services. Communications with the ombudsman are confidential.
- NY AG gets Citibank ChexSystems policy commitment New York Attorney General Eric Schneiderman has that Citibank, N.A. has agreed to adopt new policies governing its use of ChexSystems, a consumer reporting agency that is often used to screen people seeking to open checking or savings accounts. Citibank's new policies are expected to allow thousands of additional New Yorkers and consumers nationwide to open bank accounts by March 15, 2015. The change comes amid concerns that screenings by ChexSystems and other consumer reporting agencies, which are used by most of the nation's banks, adversely affect lower-income applicants and force them to turn to high-cost alternative financial services like check-cashing outlets. With this agreement, Citibank now joins Capital One as the second bank to commit to overhaul its use of ChexSystems. According to the AG's release, although Citibank will continue screening customers for past fraud, it will revamp its so-called "account-abuse" screening so that applicants are not rejected for isolated or minor banking errors, such as paid debts or a small overcharge.
- FSR and CFPB to promote financial education The Financial Services Roundtable (FSR) has announced it will join the CFPB in a public-private initiative to join forces promoting effective financial education nationwide. The CFPB, through its Office of Financial Education, and the FSR will work together to facilitate the gathering and sharing of information about effective financial education strategies; to encourage adoption of financial education initiatives, especially in K-12 schools and in the workplace; and to protect older Americans from financial exploitation. CFPB and FSR will host a series of working groups and listening sessions at various locations throughout the country to determine best practices and a path forward.
- FOMC statement released The Federal Reserve Board has released the Federal Open Market Committee's statement on its December 2014 meeting. The Committee reaffirmed its view that the current 0 to ¼ percent target range for the federal funds rate remains appropriate. In determining how long to maintain this target range, the Committee will assess progress—both realized and expected—toward its objectives of maximum employment and 2 percent inflation. In addition, the Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction.
January 28, 2015
- CFPB Supervisory Compliance Bulletin The CFPB has the issuance of Compliance Bulletin 2015-01 to remind supervised financial institutions, including nonbank companies that may be unfamiliar with federal supervision, of existing regulatory requirements regarding confidential supervisory information. The bulletin provides guidance on what types of information constitute confidential supervisory information. The bulletin also explains that disclosure of confidential supervisory information is not allowed, with limited exceptions.
- Oppenheimer to pay for ongoing AML problemsThe Financial Crimes Enforcement Network (FinCEN), and the Securities and Exchange Commission (SEC) have announced the assessment of a combined $20 million civil money penalty (CMP) against Oppenheimer & Co., Inc., for willfully violating the Bank Secrecy Act (BSA). The regulators contended that Oppenheimer (a securities broker-dealer in New York) conducted suspicious penny stock trading, that pump-and-dump schemes were not flagged, that a foreign correspondent customer was allowed to conduct prohibited activity, and that Oppenheimer failed to file SARs. The firm admitted that it failed to establish and implement an adequate anti-money laundering program, failed to conduct adequate due diligence on a foreign correspondent account, and failed to comply with requirements under Section 311 of the USA PATRIOT Act. Oppenheimer was assessed a $2.8 million CMP in 2005 by FinCEN and the New York Stock Exchange. In 2013, the financial Industry Regulatory Authority (FINRA) fined the firm $1.4 million for violations of securities laws and anti-money laundering failures.
- Financial well-being report released by CFPB A CFPB article announces the release of a report on financial well-being and discusses the four elements of financial well-being identified by consumers who participated in the Bureau's study on the subject:
The Bureau makes the full 48-page report or a digest available.
- Feeling in control
- Capacity to absorb a financial shock
- On track to meet goals
- Flexibility to make choices
- OFAC SDN List changes The Department of the Treasury's OFAC Resource Center has posted a notice announcing the addition of two individuals to the SDN Lists under the Kingpin Act and one individual designated as a global terrorist. There were also several listings removed from the Counter Narcotics Designations lists (SDNTK and SDNT).
- Loan Originator Compensation Rule video available The FDIC has released the second in a series of three new technical assistance videos developed to assist bank employees in meeting regulatory requirements. These videos address compliance with certain mortgage rules issued by the Consumer Financial Protection Bureau (CFPB). The first video, released on November 19, 2014, covered the Ability to Repay and Qualified Mortgage Rule. The second video covers the Loan Originator Compensation Rule, and the third video, expected to be released in February 2015, will cover the Servicing Rule.
- Residential sales increase HUD and the Census Bureau have released the December 2014 residential sales data. Sales of new single-family houses in December 2014 were at a seasonally adjusted annual rate of 481,000 which was 11.6 percent above the revised November rate and 8.8 percent above the December 2013 estimate. The median sales price of new houses sold in December 2014 was $298,100 and the average sales price was $377,800.
January 27, 2015
- OCC issues extreme winter weather proclamation A proclamation has been issued by the Office of the Comptroller of the Currency allowing national banks and federal savings associations at their discretion to close offices affected by extreme winter weather in the northeast United States.
- Federal Reserve updates excess balance account FAQs Federal Reserve Services has the update of the Excess Balance Account (EBA) FAQs. A new section, "Account Management Practices and Sweeping," addresses questions raised by common account management practices between EBA agents and participants. Additional information is available at the Excess Balance Account Resource Center.
- Federal Reserve releases plan for improvement payments The Federal Reserve has issued "Strategies for Improving the U.S. Payment System," which presents a multi-faceted plan for collaborating with payment system stakeholders, including large and small businesses, emerging payments firms, card networks, payment processors, consumers and financial institutions to enhance the speed, safety and efficiency of the U.S. payment system. The Federal Reserve's strategic direction for financial services focuses on improving the end-to-end speed, safety and efficiency of the payment system. The Federal Reserve undertook an extensive 18-month research program aimed at identifying key gaps and opportunities, gaining industry and end-user perspectives on needs and priorities and defining ways to achieve payment improvements. The Federal Reserve will host a webcast at 1:00 p.m. EST on January 29, to share views on the Federal Reserve's vision for the future U.S. payment system and plans for collaborating with stakeholders to achieve shared goals. In addition, a subsequent series of FedForum teleseminars on February 4 and 10 will present an overview of the strategies and a question-and-answer session. Details on accessing the webcast and registering for the FedForum events are included in an announcement on the FedPayments Improvement website.
- New resources for consumers to fight ID theft The NCUA has announced the addition of new information regarding ways to combat identity theft to MYCreditUnion.gov, its consumer web site. The site also contains other resources to help credit union members understand and prevent identity theft and other frauds and scams.
- NCUA TRID rules webinar
The NCUA will host a free webinar, "Preparing for the New TILA-RESPA Integrated Disclosures," on February 11, 2015, starting at 2 p.m. ET. The webinar will provide a high-level overview of the significant changes to the disclosures and forms required under the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA) that are scheduled to go into effect August 1. Online registration is available.
- Bureau seeks comment on student account scorecard
The CFPB has published in this morning's Federal Register a notice and request for comment on its draft Safe Student Account Scorecard that would offer information to colleges and universities when soliciting agreements from financial institutions to market safe and affordable financial accounts for their students. Comments are due by March 9, 2015.
January 26, 2015
- Chicago bank closed The Illinois Department of Finance and Professional Regulation, Division of Banking has closed Highland Community Bank, Chicago, Illinois. The FDIC was appointed receiver and all deposits have been assumed by United Fidelity Bank, fsb, Evansville, Indiana.
- E-Payments Routing Directory change delayed Federal Reserve Financial Services has that the scheduled move of the Federal Reserve E-Payments Routing Directory has been postponed. The original move date was January 25, 2015. A new effective date for the move is to be determined.
- CRA ratings released The Office of the Comptroller of the Currency has released the ratings received by thirty national banks and federal savings associations that were recently examined for compliance with CRA. Two of the institutions listed were rated outstanding, and twenty-eight received satisfactory ratings.
- FDIC update on professional liability lawsuits The FDIC has updated the data on its Professional Liability Lawsuits page to indicate that 14 such suits have been filed thus far in January 2015. As receiver for a failed financial institution, the FDIC may sue professionals who played a role in the failure of the institution in order to maximize recoveries. These individuals can include officers and directors, attorneys, accountants, appraisers, brokers, or others. Professional liability claims also include direct claims against insurance carriers such as fidelity bond carriers and title insurance companies. From January 1, 2009, through January 22, 2015, the FDIC has authorized suits in connection with 149 failed institutions against 1195 individuals for D&O liability.
January 23, 2015
- Wells and JPMC to pay in mortgage kickback case, filed in federal court. The proposed consent orders, which have also been filed with the court for approval, would require $24 million in civil penalties from Wells Fargo, $600,000 from JPMorgan Chase, and $11.1 million in redress to consumers whose loans were involved. The loan officer and his wife would pay a $30,000 penalty, and the loan officer would be barred from the mortgage industry for two years. A third financial institution whose loan officers also participated in the Genuine Title kickback scheme self-identified the practice and fired the officers involved (one of whom was the former Wells Fargo officer previously mentioned). It also cooperated with the Bureau's investigation and proactively initiated a remediation plan. As a result, the Bureau resolved its investigation into that institution without an enforcement action.
- Communities to be suspended from Flood Program The Federal Emergency Management Agency has published in this morning's Federal Register three notices identifying communities where the sale of flood insurance has been authorized under the National Flood Insurance Program that are scheduled for suspension from the program due to noncompliance with the floodplain management requirements of the program.
- The first identifies communities to be suspended on February 4, 2015, in Delaware, Indiana, Maryland, Michigan, Missouri and Wisconsin
- The second identifies communities to be suspended on February 18, 2015, in Indiana, Maryland, Michigan and Virginia
- The third identifies communities to be suspended on March 2, 2015, in Indiana, Iowa and Virginia
- Counterfeit cashier's checks The OCC has issued Alert 2015-3 concerning counterfeit cashier's checks using the routing number of The Bank, N.A., McAlester, Oklahoma. The checks are being presented for payment nationwide in connection with various Internet-based employment and purchase scams. Two variations of counterfeit checks currently in circulation resemble the bank's authentic checks. Information regarding the counterfeit checks will be posted on the BOL Alerts & Counterfeits pages.
- NMLS downtime The NMLS has it has scheduled system downtime from 9:00 pm. ET Friday, January 23 (this evening) until Saturday afternoon, January 24, to install system enhancements. Both the NMLS and Consumer Access systems will be unavailable during the downtime.
- FHFA index rises The Federal Housing Finance Agency (FHFA) has announced that U.S. house prices rose in November 2014, up 0.8 percent on a seasonally adjusted basis from the previous month, according to the monthly House Price Index (HPI). The previously reported 0.6 percent change in October was revised downward to a 0.4 percent change.
- Addition to Comptroller's Handbook
The OCC has issued Bulletin 2015-5 to announce the addition of a new "Government Securities Act" booklet to the Comptroller's Handbook. As part of the Securities Compliance series, the new booklet consolidates certain guidance from the Comptroller's Handbook for Compliance "Securities Activities" booklet, issued in September 1991, and the Comptroller's Handbook booklet "Investment Securities," issued in March 1990.
- NCUA announces late-filing penalties
The NCUA has announced that 31 federally insured credit unions subject to civil money penalties for filing third-quarter 2014 Call Reports late have consented to those penalties. The late filers will pay a total of $12,820 in penalties.
- Bureau and Maryland hit Wells and JPMC
The Consumer Financial Protection Bureau has announced action taken by the Bureau and the Maryland Attorney General against Wells Fargo and JPMorgan Chase for an illegal marketing-services-kickback scheme involving a now-defunct title company. Action was also taken against a former Wells Fargo employee and his wife for their involvement in the scheme. Genuine Title would give the banks' loan officers cash, marketing materials, and consumer information in exchange for business referrals, according to the CFPB's complaint, filed in federal court. The proposed consent orders, which have also been filed with the court for approval, would require $24 million in civil penalties from Wells Fargo, $600,000 from JPMorgan Chase, and $10.8 million in redress to consumers whose loans were involved. The loan officer and his wife would pay a $30,000 penalty.
A third financial institution whose loan officers also participated in the Genuine Title kickback scheme self-identified the practice and fired the officers involved. It also cooperated with the Bureau's investigation and self-initiated a remediation plan. As a result, the Bureau resolved its investigation into that institution without an enforcement action.
January 22, 2015
- FTC credit report accuracy follow-up study The Federal Trade Commission has issued a follow-up report that found most consumers who previously reported an unresolved error on one of their three major credit reports believe that at least one piece of disputed information on their report is still inaccurate. The original study issued in 2012 found that one in five consumers had an error that was corrected by a credit reporting agency (after it was disputed) on at least one of their three credit reports. The follow-up study announced today focuses on 121 consumers who had at least one unresolved dispute from the 2012 study and participated in a follow-up survey.
- Texas debt collector sued by FTC The FTC has the filing of a federal court complaint against Commercial Recovery Systems, Inc. (CRS), a Texas-based debt collector, and its current and former principals for illegally threatening consumers with false claims that unless they pay a debt, they will face legal action or wage garnishment, or otherwise violated the Federal Trade Commission Act and the Fair Debt Collection Practices Act.
- December residential construction activity rises HUD and the Census Bureau have released their report on new residential construction activity in December 2014. The report shows:
- Privately owned housing units authorized by building permits in December were 1.9 percent below the revised November rate, but 1.0 percent above the December 2013 estimate.
- Privately owned housing starts in December were at a seasonally adjusted annual rate 4.4 percent above the revised November estimate and 5.3 percent above the December 2013 rate.
- Single-family housing starts in December were 7.2 percent above the revised November figure.
- Privately owned housing completions in December 6.3 percent above the revised November estimate and 19.6 percent above December 2013 numbers.
- Single-family housing completions in December were 9.5 percent above the revised November rate.
- Lew on the State of the Union In remarks at The Brookings Institution, Treasury Secretary Lew discussed the series of proposals presented by the President in his State of the Union address.