Feb 13

Recent Compliance Issues: 12/27/13 – 1/9/14

  • On Monday, Jan. 6, the CFPB, in response to the mortgage rules that took effect Jan. 10, developed a “fact vs. fiction guide” regarding the new Ability-to-Repay (ATR) and Qualified Mortgage (QM) standards. This document is intended to aid institutions with interpreting the rules and helping to dispel some of the most common misconceptions about what these new mandates mean for consumers.

    The CFPB also noted that the ATR and QM standards are really just taking the mortgage world “back to the basics” and that they are common sense standards that all “reasonable lenders” have been following for decades. But is that true?

    We have qualified and experienced staff that can assist your institution in understanding the new mortgage rules, as well as interpreting the recent guidance provided by the CFPB as they may pertain to the mortgage activities that take place at your institution.

  • In July 2007, payroll cards became subject to the consumer protections of Regulation E, the implementing regulation for the Electronic Fund Transfer Act. As the use of these cards increased, so has the number of consumer protection regulations with which payroll card issuers must comply. Banks should conduct appropriate reviews of federal and state laws, including those related to customer identification, state employee compensation restrictions, and federal consumer financial protection laws, before implementing a payroll card product.

    If your institution already offers this functionality, compliance professionals should be monitoring the evolving marketplace and regulatory environment to ensure payroll cards’ continued compliance.

    Our former Federal regulators can assist you in either enhancing or strengthening your existing compliance program to meet the various compliance requirements with respect to this increasingly popular product.

  • Federal financial regulators issued recent guidance to clarify that consumer protection laws and regulations apply to social media activities that a bank may be conducting, as they would through other channels. The guidance provides expectations of how banks should manage the associated consumer compliance, legal, regulatory, and operational risks in this area.

    Since financial institutions are increasingly using social media as a means to attract new business and create an interactive environment with consumers, risk management programs should provide appropriate oversight and control.

    Members of our consumer compliance staff can provide guidance on the appropriate level of oversight and control your institution may need to avoid regulatory weaknesses.