Regulatory Compliance Update
By: Hickman Beckner, Senior Vice President
We have reviewed the Compliance News for May 2019. The IRS has issued changes for tax reporting forms for tax year 2019. The CFPB has issued a request for information on the rules for remittance transfers.
IRS -The IRS has published the following changes:
Form 1042-S – Added a new check box for completion by the recipient and changed the legend for the Foreign Tax Identification Number.
1098 – Changed the legend for Boxes 9 through 11. The date for the outstanding mortgage balance has been deleted and replaced with a generic phrase.
No other changes will affect the Shaw systems.
CFPB – Has issued a request for information for the rules covering Remittance Transfers. This is only an information request. No new rules have been issued.
June 28, 2019 – Comments due on the CFPB’s Request For Information on potential changes for Remittance Transfer Rules.
July 1, 2019 – Effective date of interagency final rule that implements private flood insurance provisions of the Biggert-Waters Flood Insurance Reform Act of 2012.
July 1, 2019 – Comments due on CFPB’s planned review of overdraft requirements of Regulation E.
July 1, 2019 – Effective date of the Office of the Comptroller of the Currency (OCC) that permits federal savings associations with total assets of $20 billion or less to elect to operate with national bank powers.
Congress is preparing for the traditional summer recess. Many new bills have been submitted.
Cybersecurity Act – would create an Office of Cybersecurity within the Federal Trade Commission, would require cybersecurity rules to be issued for consumer reporting agencies (credit bureaus) and would impose penalties on credit reporting agencies for cybersecurity breaches.
Consumers First Act – Would codify the Consumer Financial Protection Bureau as the official name of the agency, would limit political appointees, would eliminate the Director of the CFPB’s powers over the Office of Fair Lending and Equal Opportunity, would establish an office of Students and Young Consumers, and establish detailed qualifications for membership for the CFPB’s advisory boards.
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. This Act has passed the House and has moved to the Senate for consideration.
Corporate Transparency Act – would require corporations and limited liability companies to disclose their true beneficial owners when formed, would establish minimum beneficial ownership disclosure rules, would require annual filings of the current beneficial owners and would provide for civil and criminal penalties for false submissions.
End Banking For Human Traffickers Act – would direct the banking regulators to cooperate with law enforcement to combat the use of the financial system for human trafficking. The Act would also protect victim’s access to bank accounts. This Act has passed the House Foreign Affairs Committee and has moved to consideration by the full House.
Fintech Act – Would require each federal regulator that regulated financial technology companies to cooperate and eliminate duplicate and conflicting regulations.
Improving Access to Traditional Banking Act – would require the CFPB to investigate and report to Congress recommendations to lessen consumer’s reliance on non-traditional banking products such as payday loans, would establish an office within the CFPB for underserved consumers and would order the new office to conduct research on the hurdles the underserved consumers face when maintaining a banking relationship.
Loan Shark Prevention Act – Would cap credit card rates at 15% but would give the Federal Reserve the authority to temporarily waive the restriction.
Protecting Consumers From Unreasonable Credit Rates – Would establish a nationwide maximum APR of 36% that would apply to all open-end and closed-end credit transactions.