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For the purposes of Regulation E Error Resolution Claims, when is the provisional credit due?
The Institution must grant provisional credit to the consumer within 10 business days after the Institution has been informed of an unauthorized transaction on the account. Provisional credit also does not have to be provided unless the notice of error has been provided in writing (i.e. not oral). This does not mean investigation doesn’t start […]
FFIEC Releases 2023 CRA Public Data Tables
On December 16, 2024, the FFIEC released the public disclosures for CRA data submitted for calendar year 2023. Note: If your institution does not report CRA small business, small farm or community development lending data, then this Special Release would not apply to you. Even if your institution is not a CRA reporter, a review […]
What is a financial institution’s (FI) responsibilities as it relates to legal entities registering Beneficial Ownership information with FinCEN? Can we access the system now? Do we need to do anything differently?
Answer: There have been no changes to the FI’s current requirements to obtain beneficial ownership information. The FAQs stated that FI’s are not currently required to access the beneficial ownership IT (BO IT) system. Access to the system is expected to be extended to FIs in the spring 2025. FinCEN intends to provide additional guidance […]
Can our designated SAFE officer be an active loan officer that is currently producing loans?
Answer: Generally, the SAFE Act Officer is the person responsible for the SAFE Act registration of the staff. The SAFE Act regulation does not allow the person that registers employees to be an MLO unless the institution has less than 10 employees. Part 1007.103 Registration of mortgage loan originators (e) Required covered financial institution information. […]
Since the US District Court issued an injunction blocking the Corporate Transparency Act, what do we do if a customer refuses to provide their beneficial ownership information at account opening?
Answer: Although this ruling prohibits FinCEN from mandating that reporting companies submit beneficial ownership information to the FinCEN database, this rule does not impact the 2018 Customer Due Diligence Rule which requires financial institutions to obtain beneficial ownership information from legal entities opening new accounts or have a change in their risk profile. If a […]
Is there any additional fair lending analysis that an institution should consider performing to ensure awareness by the institution?
Answer: Yes, the regulatory agencies are requesting institutions to include their originated small business loans as part of their fair lending review to determine their lending patterns in substantially minority census tracts within their assessment area to note any redlining issues. This practice is a precursor to the future 1071 Small Business Data Collection analysis.
If a customer notifies an institution of unauthorized EFT transactions more than 60 days after the date of the statement when the first unauthorized EFT transaction occurred, what is the institutions responsibility concerning this claim?
Answer: While the institution is still required to investigate the claim, the institution is not obligated to comply with the provisional credit rules nor the 45-day (90-days) resolution time period. It should be noted that if the EFT claim does not involve fraud (i.e., the claim involves an approved transaction that was not clear for […]
Does our institution have to open accounts for nonresident aliens or resident aliens (NRA/RA)?
Answer: A broad prohibition on opening accounts for NRA/RA’s may lead to accusations of discrimination and reputational risk. Speaking from an AML perspective, Institutions should proactively have a Customer Identification Program (CIP) that is risk based and reasonably designed to allow the institution to form a reasonable belief that it knows the identity of its […]
When should our (Compliance, BSA, Fair Lending, Other) Risk Assessment be updated?
Answer: Updating your institution’s compliance risk assessments is crucial for maintaining regulatory standards and ensuring effective risk management. The Risk Assessment communicates the Board of Directors’ tolerance of risks and identifies controls for managing risks within those tolerances. Examples of events that may require a Risk Assessment update: As the basis for updating policies and procedures, […]
An institution allows service charges to overdraw our checking accounts but not our savings accounts. Should that be in our disclosures somewhere?
Answer: The FDIC has been criticizing Institution’s for not disclosing this possibility. Under Regulation DD, Institutions are required to disclose what can cause overdrafts. The typical language is: Overdraft fees apply to overdrafts created by check, in-person withdrawal, ATM withdrawal, or other electronic means. TCA recommends additional changes based on whether or not the Institution […]
