Regulatory Compliance Update April 2019

Regulatory Compliance Update

By: Hickman Beckner, Senior Vice President

We have reviewed the Compliance News for March 2019. The Consumer Financial Protection Bureau together with the Federal Reserve proposed changes to regulations regarding funds availability. The FDIC is seeking comments on rules for brokered deposits. The FFIEC has proposed changes for smaller institutions filing the Bank Call report.

CFPB and Fed – Proposed several changes to Regulation CC – Availability of funds and Collection of Checks:

  • Amending the regulation to cover American Samoa, Northern Mariana Islands and Guam.
  • Changing the calculation methods used for adjusting the amounts for next day availability, cash withdrawal amount, new account exceptions and large item exception.

The proposed rule changes only affect deposit accounts.

FDIC is asking for public comments on rules dealing with brokered deposits. These rules only cover deposit accounts.

FFIEC – Has delayed the effective date for rules covering smaller institutions filing the Bank Call Report.

Significant Dates:

April 1, 2019 – Effective date for CFPB rules for Prepaid Accounts which implement changes to Regulation Z and Regulation E. The date was extended from April 1, 2018.

April 1, 2019 – Effective date of the final interagency regulatory capital rules regarding the implementation and transition of the new FASB methodology for expected credit losses.

May 1, 2019 – Comments due on the FCIC’s request for information regarding consumer credit cards.

May 15, 2019 – Comments due on CFPB’s proposed revisions to the final rules on payday loans, vehicle title loans and high cost consumer loans.

Emerging Issues:

Cooperate With Law Enforcement Agencies and Watch Act – would provide a “safe harbor” for financial institutions cooperating with law enforcement agencies in ongoing criminal investigations.

FinCEN Improvement Act – would amend the duties of the Financial Crimes Enforcement Network to ensure FinCEN works with tribal law enforcement, protects against terrorism and focuses on virtual (crypto) currencies.

Consumer Financial Protection Bureau Accountability Act – would change the source of funding for the CFPB to annual congressional appropriations and away from the Federal Reserve.

SAFE Lending Act – would put rules in effect to prevent third parties from controlling a consumer’s bank account through remotely created checks, would require banks to abide by state laws for small dollar loans, would require payday lenders to register with the CFPB, would ban overdraft fees on prepaid cards issued by payday lenders, and would require the CFPB to monitor any other fees associated with prepaid cards issued by payday lenders.

Consumers First Act – would roll back the attempted name change of the CFPB, would place limitations on political appointees who serve as CFPB employees, would require all consumer complaints to be made publicly available on the CFPB website, would eliminate the CFPB director’s ability to limit the power of the Office of Fair Lending and Equal Opportunity, would establish an Office of Students and Young Consumers and would establish detailed requirements for the CFPB advisory groups.

Self-employed Mortgage Access Act – would help credit-worthy borrowers with non-traditional forms of income to qualify for federally guaranteed mortgages by allowing lenders to verify the applicant’s income using additional forms of documentation.

Tax Extender and Disaster Relief Act – would retroactively extend through 2019 certain tax provisions and would provide disaster relief for individuals and businesses affected by major disasters occurring after January 1, 2018 and before March 1, 2019.

FIRM IT Act – would direct the Federal Emergency Management Agency (FEMA) to consult with the Department of Defense, U.S. Geological Survey and the National Oceanic and Atmospheric Administration for information on the National Flood Insurance Program rate maps.

Home Loan Quality Transparency Act – would reinstate certain reporting requirements of lenders that were repealed by earlier laws in 2018, would restore the requirement that loan quality criteria be made public by lenders and would give regulators and advocates information on lending practices.

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