Keep up to date with our Regulatory Compliance Manager Subscription Service
If there’s a subject that you’d like to research, please call 800-934-REGS or email us [email protected] and we’ll get the information to you.
Everything Old is New Again- OCC Rescinds CRA Rules
The OCC issued News Release 2021-133 on December 14, 2021, announcing the final rescinding of their June 2020 Community Reinvestment Act (CRA) Rule.The Final Rule will become effective as of January 1, 2022 and will apply to all national banks as well as to both federal and state savings associations. Financial institutions regulated by the […]
What do we do with Federal Government ACH payments received and posted after the Date of Death, but before a financial institution was notified of the recipient’s death?
Answer: When the financial institution is notified of the death of a recipient, it must return all subsequent post-death benefit payments with a Return Reason Code R15 or R14. These codes notify the Federal agency of the recipient’s death. The financial institution may return any post-death benefits that have already posted by ACH without waiting […]
How do I complete Part II (Amounts and Dates) on a continuing activity suspicious activity report (SAR) if the transaction took place on a single date? Do I include the investigation range from the previous filing?
Answer: The date field in Part II should only cover the date range of activity determined to be suspicious, not the investigation range. If transaction occurred on a single date, the “To” field is left blank. Describe the time period of the investigation in the narrative.
A financial institution (FI) is adding a closing fee to the Loan Estimate (LE) due to a valid changed circumstance. The loan is set to close early next week and the FI needs to issue the Closing Disclosure (CD) in order to close on the borrower’s timeframe. Can the FI send both the revised LE and the initial CD on the same day?
Answer: No. Under Regulation Z, there has to be one day between the LE and CD. A revised LE must be issued no later than four business days prior to consummation and a CD must be issued at least three business days prior to consummation. However, Regulation Z does also permit us to provide changes […]
A Loan Officer took an application by telephone, and the borrower failed to sign the acknowledgement to apply for joint credit on the application that was mailed for signature. How can joint intent be documented?
Answer: While it is always preferred that the borrower initial the joint intent statement on the application, there are times when the borrower fails to do so. Loan Officers should ask the borrowers this question during the initial phone application and document it in their notes. In the case where an application is returned without […]
Is there any new fair lending risk that a financial institution should make sure is included in the Fair Lending Risk Assessment?
Answer: Yes. A new CFPB initiative has been developed known as PAVE – Property Appraisal and Valuation Equity. It is an Interagency Task Force to address inequity in home appraisals. Examiners will be looking to see how financial institutions ensure there is no appraisal bias in minority neighborhoods or minority homes by monitoring the financial […]
Can a financial Institution remain open on the Juneteenth holiday in 2022 and going forward, even if the Federal Reserve is closed?
Answer: Yes, financial institutions can decide to remain open on Juneteenth, the newest federal holiday. Many financial institutions remain open on other Federal holidays, such as Veteran’s Day, Martin Luther King Jr. Day, etc. to conduct business. Even though the institution may decide to remain open on Federal holidays, keep in mind that the business […]
We are making a construction permanent (C-P) loan where the home will be located in a Special Flood Hazard Zone. Are we required to escrow for flood insurance during the construction phase?
Answer: Because the overall term of the C-P loan is greater than 12 months, you are required to escrow for flood insurance. The fact that the construction phase is 12 months or less is irrelevant. This means that you must require flood insurance at consummation.
What is the current status of the sunset of the LIBOR?
Answer: The sunset of the LIBOR has been delayed from December 31, 2021 to June 30, 2023. In spite of the delay, the OCC, The Federal Reserve Board, and the FDIC issued a joint statement that encouraged institutions to cease entering into new contracts that use the USD LIBOR as a reference rate as soon […]
Are there fair lending concerns when a financial Institution utilizes a third-party vendor that provides data for marketing or assists in the development of a credit underwriting model containing digital algorithms?
Answer: Yes. The Financial Institution needs to be aware of what makes up the data that is obtained and how the data is applied. These algorithms may be filtered by zip codes, level of education or purchasing behaviors. The Financial Institution needs to ensure the algorithms used do not cause disparate impact by eliminating protected […]
