SEC Takes Action Against Merrill Lynch and BACNAH for Failing to File SARs

Adam Witmer
Regulatory Update, BSA

On July 11, 2023, the SEC announced charges against Merrill Lynch, Pierce, Fenner & Smith Incorporated and its parent company BAC North America Holding Co. (BACNAH) for failing to file hundreds of Suspicious Activity Reports (SARs) from 2009 to late 2019. To settle the SEC charges, Merrill Lynch agreed to pay a $6 million penalty. Merrill Lynch also agreed to pay a $6 million fine to settle charges brought by the Financial Industry Regulatory Authority (FINRA).

CFPB Fines Bank of America for Multiple Violations

Adam Witmer
Regulatory Update, UDAAP, Regulation Z

On July 11, 2023, the CFPB ordered Bank of America to pay more than $100 million to customers for systematically double-dipping on fees imposed on customers with insufficient funds in their account, withholding reward bonuses explicitly promised to credit card customers, and misappropriating sensitive personal information to open accounts without customer knowledge or authorization. Bank of America will pay a total of $90 million in penalties to the CFPB and $60 million in penalties to the OCC, which also found that the bank’s double-dipping on fees was illegal.

CFPB Releases 2022 Fair Lending Annual Report to Congress

Adam Witmer
Regulatory Update, Fair Lending

On June 29, 2023, the CFPB released its Fair Lending Annual Report to Congress, describing its fair lending activities in enforcement and supervision; guidance and rulemaking; interagency coordination; and outreach and education for calendar year 2022. The Fair Lending Annual Report to Congress fulfills the Bureau’s statutory responsibility to report annually to Congress on public enforcement actions taken under the ECOA as well as the utility of the HMDA’s mortgage loan data collection requirements.

FinCEN Issues Updated FATF Deficient Countries

Adam Witmer
Regulatory Update, BSA

On Jun 29, 2023, FinCEN issued a press release to inform U.S. financial institutions that the Financial Action Task Force (FATF), an intergovernmental body that establishes international standards to combat money laundering, counter the financing of terrorism, and combat weapons of mass destruction proliferation financing (AML/CFT/CPF), has issued public statements updating its lists of jurisdictions with strategic AML/CFT/CPF deficiencies following its plenary meeting this month.  U.S. financial institutions should consider the FATF’s stance toward these jurisdictions when reviewing their obligations and risk-based policies, procedures, and practices.

CFPB Takes Action Against ACI for Illegally Processing Mortgage Payments

Adam Witmer
Regulatory Update, Regulation E

On June 27, 2023, the CFPB issued an order against ACI Worldwide and one of its subsidiaries, ACI Payments, for improperly initiating approximately $2.3 billion in unlawful mortgage payment transactions. According to the CFPB, ACI’s data handling practices negatively impacted nearly 500,000 homeowners with mortgages serviced by Mr. Cooper (formerly known as Nationstar).

FDIC Updates Supervisory Guidance on Multiple Re-Presentment NSF Fees

Adam Witmer
Regulatory Update

On June 16, 2023, the FDIC updated its Supervisory Guidance on Multiple Re-Presentment NSF Fees (FIL-40-2022) to clarify its supervisory approach for corrective action when a violation of law is identified. In August of 2022, the FDIC issued the original guidance to address certain consumer compliance risks associated with assessing multiple non-sufficient funds (NSF) fees arising from the re-presentment of the same unpaid transaction.

VIDEO: What is BSA

VIDEO: What is BSA

Adam Witmer
BSA

In this Compliance Clip (video), Adam gives a short but sweet explanation of what the BSA or Bank Secrecy Act is and its role in preventing and detecting money laundering activities. A transcript of this video is now available.

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