Welcome to the Compliance Cohort. We are a group of compliance professionals working to make compliance easier. Our goal is to take complex compliance concepts and put them in simple terms that apply to the real world. We are glad you have found us and look forward to collaborating in the future.
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In this Compliance Clip (video), Adam discusses the importance of a well designed Compliance Management System (CMS) and explains what the goal should be for a CMS. Maybe even more importantly, Adam explains what he considers a key element needed to be able to have an effective CMS. The video concludes with an explanation about how our premium memberships can assist financial institutions in implementing and managing their Compliance Management Systems.
On July 15, 2022, the OFAC announced a settlement with American Express National Bank (Amex) to settle its potential civil liability for 214 apparent violations of OFAC’s Kingpin sanctions. Amex agreed to remit $430,500, which reflects OFAC’s determination that the apparent violations were not voluntarily self-disclosed and were non-egregious.
On July 15, 2022, the FDIC issued a statement, adding a new Question and Answer (Q&A), and updating public information on the Banker Resource Center Brokered Deposits Page, to remind FDIC-insured depository institutions (IDIs) that deposits swept from broker dealers with a primary purpose exception to unaffiliated IDIs must be reported as brokered if there are any additional third parties involved that qualify as a deposit broker.
On July 14, 2022, the OCC assessed a $125 million civil money penalty against Bank of America, N.A., for violations of law and unsafe or unsound practices relating to the bank’s administration of a prepaid card program to distribute unemployment insurance and other public benefit payments. The OCC also ordered the bank to provide remediation to consumers harmed by the bank’s practices and violations of law.
On July 14, 2022, the CFPB fined Bank of America $100 million for botching the disbursement of state unemployment benefits at the height of the pandemic. According to the CFPB’s press release, Bank of America automatically and unlawfully froze people’s accounts with a faulty fraud detection program, and then gave them little recourse when there was, in fact, no fraud. The Office of the Comptroller of the Currency (OCC) is also fining the bank $125 million in a separate order.
On July 12, 2022, the CFPB filed a lawsuit against payday lender ACE Cash Express for concealing free repayment plans from struggling borrowers as well as improperly withdrawing consumers’ funds. According to the complaint, ACE’s illegal practices generated at least $240 million in fees for the company while keeping borrowers in debt.
On July 6, 2022, the FDIC, the Federal Reserve Board, FinCEN, the NCUA, and the OCC issued a joint statement to remind banks of the risk-based approach to assessing customer relationships and conducting customer due diligence (CDD). The agencies clarify that the statement does not alter existing BSA/AML legal or regulatory requirements, nor does it establish new supervisory expectations.
On July 7, 2022, the CFPB issued a legal interpretation to ensure that companies that use and share credit reports and background reports have a permissible purpose under the Fair Credit Reporting Act. The advisory opinion clarifies that credit reporting companies and users of credit reports have specific obligations to protect the public’s data privacy.
On July 5, 2022, HUD announced that it is charging 21 Palms RV Resort, Inc. and Nathan Dykgraaf, owner and manager of 21 Palms RV Resort Park in Davenport, Florida, with discriminating against a former tenant, who is a transgender woman, because of her gender identity. HUD’s Charge of Discrimination resulted from a complaint that the tenant filed with HUD, which alleges that Mr. Dykgraaf gave the tenant a letter stating that he was aware she was transitioning and telling her to act as a man, talk as a man, and dress as a man to avoid trouble.
On July 1, 2022,, the OFAC issued a reminder to holders of blocked property to provide the office with a comprehensive list of all blocked property held as of June 30 of the current year by September 30, pursuant to the Reporting, Procedures and Penalties Regulations. OFAC emphasizes that persons that do not hold blocked property as of June 30 do not need to file an Annual Report of Blocked Property.
