Regulatory Compliance Update February 2017

Regulatory Compliance Update

By: Hickman Beckner, Vice President

The regulatory activity slowed down in January with the change in administration. Most of the regulatory activity were updates to the existing regulations.

IRS – Information Return Penalties

The IRS has updated the inflation-adjusted penalties to information returns and payee statements.

Corrected return filed within 30 days:
Per Return: $50
Maximum Total penalty: $536,000

Corrected return filed after 30 days:
Per Return: $100
Maximum Total penalty: $1,609,000

Corrected Return filed after August 1st
Per Return: $260
Maximum Total penalty: $3,218,500

Intentional Disregard of Filing Requirements:
Per Return: $530
Maximum Total penalty: Unlimited

Federal Deposit Insurance Corporation (FDIC)

The FDIC has published the final rules to ensure that deposit insurance will be paid out quickly to covered depositors when certain large banks fail. These rules cover record keeping for deposit accounts. There is no effect on loans.

Federal Financial Institutions Examination Council (FFIEC)

The FFIEC has finalized new Bank Call Reporting Requirements for certain “small” institutions. The new format is optional for banks with less than $1 billion in assets. The new form reduces the existing report. Some of our clients may qualify for the new reporting but the call report is usually generated from their general ledger. There are no system changes required.

Significant Dates:

February 17, 2017 – (changed from January 2017) Comments due on proposed rulemaking for cyber risk management standards for large and interconnected financial institutions.

February 21, 2017 – Comments due for CFPB’s “Request for Information Regarding Consumer Access to Financial Records.”

September 15, 2017 – Effective date for Phase 2 of NACHA’s same day ACH Processing.

September 29, 2017 – Effective date for NACHA Operating Rules that require registration of third-party senders.

October 19, 2017 – Effective date for CFPB final mortgage servicing rules covering:

  • Definition of delinquency
  • Forced placed insurance notices
  • Early intervention for defaults
  • Loss mitigation
  • Prompt payment crediting
  • Wording changes on statements to reflect successors in interest
  • Small servicers

Emerging Legislation:

Shaw Systems continues to monitor the legislation submitted. Look for updates in the future.