The below article is the Compliance Notes section of the June 2018 Compliance Journal. The full issue may be viewed by clicking here.

The Wisconsin Supreme Court has accepted WBA’s amicus brief in the Koss Corp. v. Park Bank case. Oral argument has now been scheduled for September 7, 2018. The case takes up the issue of what constitutes “bad faith” under Wisconsin’s Uniform Fiduciary Act (UFA). The trial court and the Wisconsin Court of Appeals both found in favor of Park Bank. There has been very little case law in Wisconsin interpreting “bad faith” under the UFA. The decision which will be made by the Wisconsin Supreme Court will be critical to banks by establishing a lasting definition of “bad faith” with which all banks must comply to avoid liability under the UFA. The American Bankers Association signed on to WBA’s brief.


WBA recently submitted comments on CFPB’s rulemaking process. In particular, WBA expressed its support of CFPB continuing to convene the Small Business Regulatory Enforcement Fairness Act (SBREFA) panels to obtain insights from experienced bankers concerning the impact of particular proposed regulations. However, WBA cautioned that CFPB needs to ensure it carefully considers the recommendations made by banker panelists. The banking industry was fortunate to have two experienced Wisconsin bankers, nominated by WBA, who were selected to serve on the Mortgage Servicing and HMDA SBREFA panels. In addition, WBA urged CFPB to provide increase comment periods to give the commenting public as much time as possible to analyze proposed rules and craft thorough and thoughtful comments. In recent years, some of the comment periods have been as little as 30 days. Unless an underlying statute prescribes such a short period of time, WBA supports a lengthier period particularly for complex proposed rules. Finally, WBA also recommended increasing implementation periods, once a rule has been finalized. The comment letter may be viewed at: https://www.wisbank.com/media/562530/06072018_cfpb-rulemaking-processes.pdf


On May 24, 2018, President Donald Trump signed S. 2155 The Economic Growth, Regulatory Relief, and Consumer Protection Act. The Act is the first set of provisions to ease banks’ burden since the Dodd-Frank Act. The Act may be viewed at: https://www.congress.gov/bill/115th-congress/senate-bill/2155/actions. On June 27, WBA will conduct a free all-member call on the Act. A recording of the call will be available on a future date. 


June 15th was World Elder Abuse Awareness Day. The Wisconsin DOJ’s Elder Abuse taskforce has set up the website http://reportelderabusewi.org to educate people on identifying and reporting elder abuse. WBA commemorated the day by releasing a social media video and resources. WBA’s video may be viewed on the association’s Facebook, Twitter, and LinkedIn profiles.


FinCEN issued and revised a ruling to provide a 90-day limited exceptive relief to covered financial institutions from the obligations of the Beneficial Ownership Requirements for Legal Entity Customers with respect to certain financial products and services that automatically rollover or renew (i.e., certificate of deposit or loan accounts) and were established before the Beneficial Ownership Rule’s Applicability Date, May 11, 2018. This exception begins, retroactively, on May 11, 2018, and will expire on August 9, 2018. The ruling may be viewed at: https://www.fincen.gov/sites/default/files/2018-05/FinCEN%20Ruling%20CD%20and%20Loan%20Rollover%20Relief_FINAL%20508-revised.pdf 


DOJ announced a coordinated law enforcement effort to disrupt Business Email Compromise (BEC) schemes that are designed to intercept and hijack wire transfers from businesses and individuals called Operation Wire Wire. The operation resulted in the arrest of 74 individuals in the U.S. and overseas. BEC, also known as “cyber-enabled financial fraud,” is a sophisticated scam often targeting employees with access to company finances and businesses working with foreign suppliers and/or businesses that regularly perform wire transfer payments. The announcement may be viewed at: https://www.justice.gov/opa/pr/74-arrested-coordinated-international-enforcement-operation-targeting-hundreds-individuals


FRB will be hosting a webinar on fintech titled Keeping Fintech Fair: Thinking About Fair Lending and UDAP Risks. The webinar will be held on 07/16/2018 at 1:00 pm central. Further information may be viewed at: https://www.consumercomplianceoutlook.org/outlook-live/2018/keeping-fintech-fair-thinking-about-fair-lending-and-udap-risks/


CFPB issued its May 2018 Complaint Snapshot which includes a focused look at complaints about debt collection. According to the report, CFPB has received approximately 400,500 debt collection complaints since July 2011, accounting for 27 percent of the total complaints received. In addition to focusing on debt collection, the Snapshot also examines complaint trends more broadly. The report may be viewed at: https://s3.amazonaws.com/files.consumerfinance.gov/f/documents/bcfp_complaint-snapshot_debt-collection_052018.pdf


FRB issued its Annual Performance Plan for 2018. The plan is broken up into six sections: Project development and resource allocation; Workforce; Physical infrastructure; Technology; Data; and Public engagement and accountability. The plan may be viewed at: https://www.federalreserve.gov/publications/2018-gpra-annual-performance-plan.htm


OCC issued its Semiannual Risk Perspective for Spring 2018 which reports credit, operational, compliance, and interest rate risks are key themes for the federal banking system. The report notes that the continued increase in market interest rates may eventually lead to higher funding costs for banks, as economic growth increases loan demand and competition for funding pressures banks to raise deposit yields. The full report may be viewed at: https://www.occ.gov/publications/publications-by-type/other-publications-reports/semiannual-risk-perspective/semiannual-risk-perspective-spring-2018.pdf 


NMLS issued the 2017 NMLS Mortgage Industry Report, compiling data concerning companies, branches, and mortgage loan originators (MLOs) who are licensed or registered in NMLS in order to conduct mortgage activities. Among its findings, the report indicated that during 2017, the number of state-licensed mortgage companies grew 3.8 percent. The number of licensed mortgage loan originators grew by 8.9 percent and the number of licenses held by MLOs grew by 15.3 percent. The full report may be viewed at: https://mortgage.nationwidelicensingsystem.org/about/Reports/2017%20Mortgage%20Report.pdf 


FRB issued its 104th Annual Report to Congress, detailing the agency’s operations and activities in calendar-year 2017. Among its findings, the report indicates that economic activity increased at a solid pace over the second half of 2017, and the labor market continued to strengthen. Measured on a 12-month basis, inflation has remained below the Federal Open Market Committee’s longer-run objective of 2 percent. The full report may be viewed at: https://www.federalreserve.gov/publications/files/2017-annual-report.pdf


CFPB published 2018 TILA-RESPA Rule updates to both versions of the Small Entity Compliance Guides and Guides to Forms. The updated documents may be viewed at: https://www.consumerfinance.gov/policy-compliance/guidance/implementation-guidance/tila-respa-disclosure-rule/


CFPB published an article titled “What to Know if You Are Facing Foreclosure After a Natural Disaster,” providing information and resources to consumers who may be struggling to make their mortgage payments following a natural disaster. The article may be viewed at: https://www.consumerfinance.gov/about-us/blog/what-know-if-you-are-facing-foreclosure-after-natural-disaster/ 


The Federal Reserve Bank of Philadelphia published a discussion paper on elder financial victimization and how consumers can avoid it. The paper presents seven important steps that consumers aged 50 or older can take to protect themselves. It also provides consumers with a list of six questions to determine how well their financial institutions are prepared to detect signs of diminished financial capacity, elder fraud, and financial abuse, and to prevent financial losses from occurring. The full paper may be viewed at: https://www.philadelphiafed.org/-/media/consumer-finance-institute/payment-cards-center/publications/discussion-papers/2018/dp18-02.pdf?la=en

By, Ally Bates

The below article is the Regulatory Spotlight section of the June 2018 Compliance Journal. The full issue may be viewed by clicking here.

Agencies Finalize Amendments to the Securities Transaction Settlement Cycle.

The Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) finalized a rule to shorten the standard settlement cycle for securities purchased or sold by national banks, federal savings associations, and FDIC-supervised institutions. The Agencies’ final rule is consistent with an industry-wide transition to a two business-day settlement cycle, which is designed to reduce settlement exposure and align settlement practices across all market participants. The final rule is effective 10/01/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-07/pdf/2018-12267.pdf. Federal Register, Vol. 83, No. 110, 06/07/2018, 26347-26349.

Agencies Propose Amendments to Regulatory Capital Rules.

The Board of Governors of the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) issued a joint proposal to address changes to U.S. generally accepted accounting principles (U.S. GAAP) described in Accounting Standards Update No. 2016–13, Topic 326, Financial Instruments—Credit Losses (ASU 2016–13), including banking organizations’ implementation of the current expected credit losses methodology. Specifically, the proposal would revise the agencies’ regulatory capital rules to identify which credit loss allowances under the new accounting standard are eligible for inclusion in regulatory capital and to provide banking organizations the option to phase in the day-one adverse effects on regulatory capital that may result from the adoption of the new accounting standard. The proposal also would amend certain regulatory disclosure requirements to reflect applicable changes to U.S. GAAP covered under ASU 2016–13. In addition, the agencies are proposing to make amendments to their stress testing regulations so that covered banking organizations that have adopted ASU 2016–13 would not include the effect of ASU 2016–13 on their provisioning for purposes of stress testing until the 2020 stress test cycle. Finally, the agencies are proposing to make conforming amendments to their other regulations that reference credit loss allowances. Comments are due 07/13/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-14/pdf/2018-08999.pdf. Federal Register, Vol. 83, No. 93, 05/14/2018, 22312-22339.

Agencies Extend Comment Period from Proposed Amendments to Enhanced Supplementary Leverage Ratio Standards.

The Board of Governors of the Federal Reserve System (FRB) and the Office of the Comptroller of the Currency (OCC) published proposed amendments to the enhanced supplementary leverage ratio standards for U.S. top-tier bank holding companies identified as global systemically important bank holding companies, or GSIBs, and certain of their insured depository institution subsidiaries in the Federal Register on 04/19/2018. The Agencies are now extending the comment period for the proposed amendments, comments are now due 06/25/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-25/pdf/2018-11336.pdf. Federal Register, Vol. 83, No. 102, 05/24/2018, 24233.

CFPB Requests Comment on Information Collection.

The Bureau of Consumer Financial Protection (CFPB) announced it seeks comment on the information collection titled Consumer Compliant Intake System Company Portal Boarding Form Information Collection System. CFPB also gave notice that it sent the collection to OMB for review. Comments are due 07/13/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-14/pdf/2018-10221.pdf. Federal Register, Vol. 83, No. 93, 05/14/2018, 22254-22255.

FFIEC Requests Comment on Information Collection.

The Federal Financial Institutions Examination Council (FFIEC) announced it seeks comment on the information collection titled Reporting information for the AMC Registry. FFIEC also gave notice that it sent the collection to OMB for review. Comments are due 06/14/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-15/pdf/2018-10327.pdf. Federal Register, Vol. 83, No. 94, 05/15/2018, 22485-22486. 

FRB Requests Comment on Information Collections.

  • The Board of Governors of the Federal Reserve System (FRB) announced it seeks comment on the information collection Report of Selected Money Market Rates. FRB also gave notice that it sent the collection to OMB for review. Comments are due 07/17/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-18/pdf/2018-10669.pdf. Federal Register, Vol. 83, No 97, 05/18/2018, 23276-23278.
  • FRB announced it seeks comment on the information collection Recordkeeping Requirements Associated with Changes in Foreign Investments (Made Pursuant to Regulation K). FRB also gave notice that it sent the collection to OMB for review. Comments are due 07/23/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-22/pdf/2018-10912.pdf. Federal Register, Vol. 83, No. 99, 05/22/2018, 23682-23683.

FDIC Requests Comment on Information Collections.

  • The Federal Deposit Insurance Corporation (FDIC) announced it seeks comment on the information collection titled Interagency Biographical and Financial Report. FDIC also gave notice that it sent the collection to OMB for review. Comments are due 06/11/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-11/pdf/2018-10093.pdf. Federal Register, Vol. 83, No. 92, 05/11/2018, 22061-22064.
  • FDIC announced it seeks comment on the information collection titled Interagency Bank Merger Act Application. FDIC also gave notice that it sent the collection to OMB for review. Comments are due 06/11/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-11/pdf/2018-10093.pdf. Federal Register, Vol. 83, No. 92, 05/11/2018, 22061-22064.
  • FDIC announced it seeks comment on the information collection titled Recordkeeping and Confirmation Requirements for Securities Transactions. FDIC also gave notice that it sent the collection to OMB for review. Comments are due 07/23/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-24/pdf/2018-11182.pdf. Federal Register, Vol. 83, No. 101, 05/24/2018, 24117-24118.
  • FDIC announced it seeks comment on the information collection titled Customer Assistance Forms. FDIC also gave notice that it sent the collection to OMB for review. Comments are due 07/23/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-24/pdf/2018-11183.pdf. Federal Register, Vol. 83, No. 101, 05/24/2018, 24116-24117.
  • FDIC announced it seeks comment on the information collection titled Interagency Supervisory Guidance for the Supervisory Review Process of Capital Adequacy (Pillar 2) Related to the Implementation of the Basel II Advanced Capital Framework. FDIC also gave notice that it sent the collection to OMB for review. Comments are due 07/24/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-25/pdf/2018-11292.pdf. Federal Register, Vol. 83, No. 102, 05/25/2018, 24306-24309.
  • FDIC announced it seeks comment on the information collection titled Credit Risk Retention. FDIC also gave notice that it sent the collection to OMB for review. Comments are due 07/24/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-25/pdf/2018-11292.pdf. Federal Register, Vol. 83, No. 102, 05/25/2018, 24306-24309.
  • FDIC announced it seeks comment on the information collection titled Disclosure Requirements Associated with the Supplementary Leverage Ratio. FDIC also gave notice that it sent the collection to OMB for review. Comments are due 07/24/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-25/pdf/2018-11292.pdf. Federal Register, Vol. 83, No. 102, 05/25/2018, 24306-24309.

FDIC Issues Terminations of Receiverships.

  • FDIC as Receiver for former depository institutions, intends to terminate its receivership for the institutions listed in the notice. The liquidation of the assets for each receivership has been completed. To the extent permitted by available funds and in accordance with law, the Receiver will be making a final dividend payment to proven creditors. Based upon the foregoing, the Receiver has determined that the continued existence of the receiverships will serve no useful purpose. Consequently, notice is given that the receiverships shall be terminated, to be effective no sooner than thirty days after the date of this notice. If any person wishes to comment concerning the termination of any of the receiverships, such comment must be made in writing, identify the receivership to which the comment pertains, and be sent within thirty days of the date of this notice to: Federal Deposit Insurance Corporation, Division of Resolutions and Receiverships, Attention: Receivership Oversight Department 34.6, 1601 Bryan Street, Dallas, TX 75201. No comments concerning the termination of the above-mentioned receiverships will be considered which are not sent within this time frame. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-05/pdf/2018-12139.pdf. Federal Register, Vol. 83, No. 108, 06/05/2018, 26057-26058.
  • FDIC as Receiver was charged with the duty of winding up the affairs of former depository institutions and liquidating all related assets. The Receiver has fulfilled its obligations and made all dividend distributions required by law. The Receiver has further irrevocably authorized and appointed FDIC-Corporate as its attorney-in-fact to execute and file any and all documents that may be required to be executed by the Receiver which FDIC-Corporate, in its sole discretion, deems necessary, including but not limited to releases, discharges, satisfactions, endorsements, assignments, and deeds. Effective on the termination dates listed in the final column of the chart in the notice, the Receiverships have been terminated, the Receiver has been discharged, and the Receiverships have ceased to exist as legal entities. The notices may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-06/pdf/2018-12092.pdf. Federal Register, Vol. 83, No. 109, 06/06/2018, 26286.

OCC Requests Comment on Information Collections.

  • The Office of the Comptroller of the Currency (OCC) announced it seeks comment on the information collection titled International Regulation. OCC also gave notice that it sent the collection to OMB for review. Comments are due 06/28/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-29/pdf/2018-11428.pdf. Federal Register, Vol. 83, No. 103, 05/29/2018, 24591-24592.
  • OCC announced it seeks comment on the information collection titled Bank Appeals Follow-Up Questionnaire. OCC also gave notice that it sent the collection to OMB for review. Comments are due 07/09/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-08/pdf/2018-12347.pdf. Federal Register, Vol. 83, No. 111, 06/08/2018, 26745.

HUD Issues Notice Regarding Tribal HUD-VA Supportive Housing Program.

The Department of Housing and Urban Development (HUD) issued a notice consolidating all Tribal HUD-VA Supportive Housing Program requirements and establishes procedures for renewal funding, subject to the availability of future appropriations. The program provides rental assistance and supportive services to Native American veterans who are Homeless or At Risk of Homelessness living on or near a reservation or other Indian areas. The notice is effective 05/22/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-22/pdf/2018-10909.pdf. Federal Register, Vol. 83, No. 99, 05/22/2018, 23710-23719.

HUD Issues Annual Indexing of Basic Statutory Mortgage Limits for Multifamily Housing Programs.

HUD has adjusted the Basic Statutory Mortgage Limits for Multifamily Housing Programs for Calendar Year 2018. The new rates may be viewed in the notice. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-04/pdf/2018-11854.pdf. Federal Register, Vol. 83, No. 107, 06/04/2018, 25683.

HUD Requests Comment on Information Collections.

  • HUD announced it seeks comment on the information collection titled Public Housing Agency Executive Compensation Information. HUD also gave notice that it sent the collection to OMB for review. Comments are due 06/20/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-21/pdf/2018-10785.pdf. Federal Register, Vol. 83, No. 98, 05/21/2018, 23478-23479.
  • HUD announced it seeks comment on the information collection titled Survey to Assess Operational and Capacity Status of Housing Counseling Agencies after a Disaster. HUD also gave notice that it sent the collection to OMB for review. Comments are due 07/23/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-22/pdf/2018-10907.pdf. Federal Register, Vol. 83, No. 99, 05/22/2018, 23719-23720.
  • HUD announced it seeks comment on the information collection titled Housing Choice Voucher (HCV) Program. HUD also gave notice that it sent the collection to OMB for review. Comments are due 07/24/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-25/pdf/2018-11306.pdf. Federal Register, Vol. 83, No. 102, 05/25/2018, 24333-24334.
  • HUD announced it seeks comment on the information collection titled Public Housing Flat Rent Exception Request Market Analysis. HUD also gave notice that it sent the collection to OMB for review. Comments are due 07/24/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-25/pdf/2018-11305.pdf. Federal Register, Vol. 83, No. 102, 05/25/2018, 24334-24335.

FEMA Issues Final Rule on Suspensions of NFIP Community Eligibility.

The Federal Emergency Management Agency (FEMA) issued a final rule which identifies communities in the state of Illinois, where the sale of flood insurance has been authorized under the National Flood Insurance Program (NFIP) that are scheduled for suspension on the effective dates listed within the final rule because of noncompliance with the floodplain management requirements of the program. If FEMA receives documentation that the community has adopted the required floodplain management measures prior to the effective suspension date given in the final rule, the suspension will not occur and a notice of this will be provided by publication in the Federal Register on a subsequent date. The effective date of each community’s scheduled suspension is the third date listed in the third column of the tables in the final rule. The final rule may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-22/pdf/2018-10844.pdf. Federal Register, Vol. 83, No. 99, 05/22/2018, 23610-23611.

FEMA Issues Final Flood Hazard Determinations.

  • FEMA has issued a final notice which identifies communities in the state of Michigan, where flood hazard determinations, which may include additions or modifications of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, or regulatory floodways on the Flood Insurance Rate Maps (FIRMs) and where applicable, in the supporting Flood Insurance Study (FIS) reports have been made final. The FIRM and FIS report are the basis of the floodplain management measures that a community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in FEMA’s National Flood Insurance Program (NFIP). The final notice is effective 08/28/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-14/pdf/2018-10151.pdf. Federal Register, Vol. 83, No. 93, 05/14/2018, 22278-22279.
  • FEMA has issued a final notice which identifies communities in the state of Ohio, where flood hazard determinations, which may include additions or modifications of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, or regulatory floodways on the Flood Insurance Rate Maps (FIRMs) and where applicable, in the supporting Flood Insurance Study (FIS) reports have been made final. The FIRM and FIS report are the basis of the floodplain management measures that a community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in FEMA’s National Flood Insurance Program (NFIP). The final notice is effective 09/14/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-14/pdf/2018-10153.pdf. Federal Register, Vol. 83, No. 93, 05/14/2018, 22277-22278.

FEMA Issues Final Notices of Changes in Flood Hazard Determinations.

  • FEMA issued new or modified Base (1% annual-chance) Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, and/or regulatory floodways (hereinafter referred to as flood hazard determinations) as shown on the indicated Letter of Map Revision (LOMR) for communities in the state of Illinois. Each LOMR revises the Flood Insurance Rate Maps (FIRMs), and in some cases the Flood Insurance Study (FIS) reports, currently in effect for the listed communities. The flood hazard determinations modified by each LOMR will be used to calculate flood insurance premium rates for new buildings and their contents. The effective date for each LOMR is indicated in the table in the final notice. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-04/pdf/2018-11869.pdf. Federal Register, Vol. 83, No. 107, 06/04/2018, 25679-25682.
  • FEMA issued new or modified Base (1% annual-chance) Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, and/or regulatory floodways (hereinafter referred to as flood hazard determinations) as shown on the indicated Letter of Map Revision (LOMR) for communities in the state of Minnesota. Each LOMR revises the Flood Insurance Rate Maps (FIRMs), and in some cases the Flood Insurance Study (FIS) reports, currently in effect for the listed communities. The flood hazard determinations modified by each LOMR will be used to calculate flood insurance premium rates for new buildings and their contents. The effective date for each LOMR is indicated in the table in the final notice. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-04/pdf/2018-11942.pdf. Federal Register, Vol. 83, No. 107, 06/04/2018, 25676-25678.
  • FEMA issued new or modified Base (1% annual-chance) Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, and/or regulatory floodways (hereinafter referred to as flood hazard determinations) as shown on the indicated Letter of Map Revision (LOMR) for communities in the states of, Illinois, Minnesota, and Wisconsin. Each LOMR revises the Flood Insurance Rate Maps (FIRMs), and in some cases the Flood Insurance Study (FIS) reports, currently in effect for the listed communities. The flood hazard determinations modified by each LOMR will be used to calculate flood insurance premium rates for new buildings and their contents. The effective date for each LOMR is indicated in the table in the final notice. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-06/pdf/2018-12102.pdf. Federal Register, Vol. 83, No. 109, 06/06/2018, 26295-26298.

FEMA Issues Proposed Flood Hazard Determinations.

FEMA has requested comments on proposed flood hazard determinations, which may include additions or modifications of any Base Flood Elevation (BFE), base flood depth, Special Flood Hazard Area (SFHA) boundary or zone designation, or regulatory floodway on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports for communities in the states of Illinois, and Indiana. The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP). Comments are due 09/05/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-07/pdf/2018-12246.pdf. Federal Register, Vol. 83, No. 110, 06/07/2018, 26494-26495.

FEMA Issues Record of Decision for the Final National Flood Insurance Program Nationwide Programmatic Environmental Impact Statement.

FEMA announced the availability of the Record of Decision for the final nationwide programmatic environmental impact statement evaluating the environmental impacts of proposed modifications to the National Flood Insurance Program. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-25/pdf/2018-11210.pdf. Federal Register, Vol. 83, No. 102, 05/25/2018, 24328-24329.

Treasury Proposes Amendments to Filing Requirements for Information Returns Required on Magnetic Media.

The Department of the Treasury (Treasury) proposes amendments to the rules for determining whether information returns must be filed using magnetic media (electronically). The proposed regulations would require that all information returns, regardless of type, be taken into account to determine whether a person meets the 250-return threshold and, therefore, must file the information returns electronically. The proposed regulations also would require any person required to file information returns electronically to file corrected information returns electronically, regardless of the number of corrected information returns being filed. The proposed regulations will affect persons required to file information returns. Comments are due 07/30/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-31/pdf/2018-11749.pdf. Federal Register, Vol. 83, No. 105, 05/31/2018, 24948-24950.

Treasury Requests Comment on Information Collections.

  • Treasury announced it seeks comment on the information collection titled Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. Treasury also gave notice that it sent the collection to OMB for review. Comments are due 07/10/2018. The notice may be viewed at:  https://www.gpo.gov/fdsys/pkg/FR-2018-05-11/pdf/2018-10024.pdf. Federal Register, Vol. 83, No. 92, 05/11/2018, 22124.
  • Treasury announced it seeks comment on the information collection titled Disability Funds—Financial Assistance Application. Treasury also gave notice that it sent the collection to OMB for review. Comments are due 07/24/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-25/pdf/2018-11304.pdf. Federal Register, Vol. 83, No. 102, 05/25/2018, 24391.
  • Treasury announced it seeks comment on the information collection titled Application for Extension of Time for Payment of Tax Due to Undue Hardship. Treasury also gave notice that it sent the collection to OMB for review. Comments are due 08/07/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-08/pdf/2018-12405.pdf. Federal Register, Vol. 83, No. 111, 06/08/2018, 26746-26747.
  • Treasury announced it seeks comment on the information collection titled Guidance Regarding Charitable Remainder Trusts and Special Valuation Rules for Transfers of Interests and Trusts. Treasury also gave notice that it sent the collection to OMB for review. Comments are due 08/07/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-08/pdf/2018-12406.pdf. Federal Register, Vol. 83, No. 111, 06/08/2018, 26746.

FHFA Requests Comment on Information Collections.

  • The Federal Housing Finance Agency (FHFA) announced it seeks comment on the information collection titled Minimum Requirements for Appraisal Management Companies. FHFA also gave notice that it sent the collection to OMB for review. Comments are due 07/16/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-16/pdf/2018-10430.pdf. Federal Register, Vol. 83, No. 95, 05/16/2018, 22681-22684.
  • FHFA announced it seeks comment on the information collection titled Minority and Women Inclusion. FHFA also gave notice that it sent the collection to OMB for review. Comments are due 07/16/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-16/pdf/2018-10431.pdf. Federal Register, Vol. 83, No. 95, 05/16/2018, 22684-22685.

FSA Opens Applications for New Pilot Program.

The Farm Service Agency (FSA) is announcing the opportunity for interested veterans to apply for a new pilot program, Veteran Farmer Streamlined Eligibility Pilot Program, which will assist veterans in meeting the management experience requirements at a faster pace for either a Microloan or Downpayment Loan through the Farm Ownership Loan (FO) Program. The purpose of the Pilot Program is to provide an educational opportunity for veterans so that they can obtain agricultural production, financial, and managerial training at an accelerated pace that will then result in the veteran to be considered conditionally eligible for either a Microloan or Downpayment Loan through the FO Program. Applications are due 07/20/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-04/pdf/2018-11873.pdf. Federal Register, Vol. 83, No. 107, 06/04/2018, 25640-25642.

FSA Requests Comment on Information Collection.

The Farm Service Agency (FSA) announced it seeks comment on the information collection titled Farm Loan Programs, Direct Loan Servicing—Special. FSA also gave notice that it sent the collection to OMB for review. Comments are due 07/30/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-31/pdf/2018-11694.pdf. Federal Register, Vol. 83, No. 105, 05/31/2018, 24966-24967.

FCIC Issues Correction to Administrative Remedies for Non-Compliance.

The Federal Crop Insurance Corporation (FCIC) issued a correction to the General Administrative Regulations; Subpart R—Administrative Remedies for Non-Compliance regulations. The outdated reference to “7 CFR part 3017” will be removed and replaced by the correct reference of “2 CFR parts 180 and 417” in §§ 400.451 and 400.456. The correction is effective 06/01/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-01/pdf/2018-11799.pdf. Federal Register, Vol. 83, No. 106, 06/01/2018, 25361.

RBC Invites Applications for Rural Economic Development Loan and Grant Programs for Fiscal Year 2018.

The Rural Business-Cooperative Service (RBC) issued a notice to invite applications for loans and grants under the Rural Economic Development Loan and Grant (REDLG) Programs for fiscal year (FY) 2018, subject to the availability of funding. This notice is being issued in order to allow applicants sufficient time to leverage financing, prepare and submit their applications, and give RBC time to process applications within FY 2018. Successful applications will be selected by RBC for funding and subsequently awarded to the extent that funding may ultimately be made available through appropriations. An announcement on the website at http://www.rd.usda.gov/newsroom/noticessolicitation-applications-nosas will identify the amount received in the appropriations. All applicants are responsible for any expenses incurred in developing their applications. Applications are due 06/30/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-22/pdf/2018-10866.pdf. Federal Register, Vol. 83, No. 99, 05/22/2018, 23625-23630.

RUS Issues Correction to Policy on Audits of Borrowers and Grantees.

The Rural Utilities Service (RUS) issued a correction to a final rule published in the Federal Register on 05/07/2018 regarding its policy on audits. The original final rule contained an incorrect URL. The effective date for the final rule is delayed from 07/06/2018, to 07/23/2018. The comment due date for the final rule is extended to 06/22/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-24/pdf/2018-11108.pdf. Federal Register, Vol. 83, No. 101, 05/24/2018, 24011-24012.

CFTC Proposes Amendments to Margin Requirements for Uncleared Swaps.

The Commodity Futures Trading Commission (CFTC) proposed amendments to the margin requirements for uncleared swaps for swap dealers and major swap participants for which there is no prudential regulator. Specifically, CFTC proposes to amend the definition of “eligible master netting agreement” in the CFTC Margin Rule to ensure that master netting agreements of firms subject to the CFTC Margin Rule are not excluded from the definition of “eligible master netting agreement” based solely on such agreements’ compliance with QFC Rules. CFTC also proposes that any legacy uncleared swap (i.e., an uncleared swap entered into before the applicable compliance date of the CFTC Margin Rule) that is not now subject to the margin requirements of the CFTC Margin Rule would not become so subject if it is amended solely to comply with QFC Rules. Comments are due 07/23/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-23/pdf/2018-10995.pdf. Federal Register, Vol. 83, No. 100, 05/23/2018, 23842-23847.

SEC Proposes Modifications to the Definition of “Agency Debt Security.”

The Securities and Exchange Commission (SEC) proposed amendments to FINRA Rule 6710 to modify the definition of “Agency Debt Security.” FINRA requires members to report to the Trade Reporting and Compliance Engine (TRACE) transactions in Agency Debt Securities, which includes those debt securities issued or guaranteed by a Government-Sponsored Enterprise (GSE). Fannie Mae and Freddie Mac, both of which are GSEs, announced changes relating to the issuance structure of their credit risk transfer securities (CRTs). Currently, Fannie and Freddie issue CRTs as direct debt obligations, and therefore CRTs fall within the definition of “Agency Debt Security” for purposes of TRACE data categorization and dissemination. FINRA understands that under the new issuance structure, CRTs will be issued by a Fannie- or Freddie-sponsored trust rather than directly by Fannie or Freddie, and proceeds from the sale of the CRTs will be placed in a trust account and managed by a third-party trustee. As a result of CRTs being issued by a trust sponsored by a GSE instead of directly issued by a GSE, CRTs would no longer fall within the technical definition of “Agency Debt Security” and would be considered corporate debt for TRACE data and dissemination purposes. This outcome would be problematic for TRACE subscribers consuming data related to CRTs because transactions in CRTs would no longer be disseminated as part of the Agency Debt data set. In addition, the TRACE system would apply the corporate, rather than Agency, debt transaction size dissemination cap for unrated securities, specifically a $1 million dissemination cap for unrated corporate debt versus $5 million for unrated Agency Debt Securities. Thus, classifying CRTs as corporate debt would decrease transparency as to the actual size of the transaction given that unrated corporate debt is disseminated with the $1, rather than $5, million dissemination cap. Comments are due 06/14/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-24/pdf/2018-11093.pdf. Federal Register, Vol. 83, No. 101, 05/24/2018, 24143-24145.

SEC Issues Technical Amendments to Rules of Practice and Rules of Organization; Conduct and Ethics; and Information and Requests.

SEC is making technical amendments to certain rules of organization and rules of practice to indicate that Commission materials will no longer be compiled and published as the “SEC Docket,” but will continue to be available on the SEC public website. The amendments are effective 06/01/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-01/pdf/2018-11618.pdf. Federal Register, Vol. 83, No. 106, 06/01/2018, 25365-25366.

FASB Issues Statement of Federal Financial Accounting Standards.

The Federal Accounting Standards Advisory Board (FASB) has issued Statement of Federal Financial Accounting Standards 55, Amending Inter-entity Cost Provisions. The Statement is available on the FASB website at http://www.fasab.gov/accounting-standards/.  The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-07/pdf/2018-12265.pdf. Federal Register, Vol. 83, No. 110, 06/07/2018, 26457.

FASB Proposes Staff Implementation Guidance 6.1.

FASB issued proposed Staff Implementation Guidance (SIG) 6.1, Clarification of Paragraphs 40–41 of SFFAS 6, Accounting for Property, Plant, and Equipment. The proposed SIG is available on the FASB website at http://www.fasab.gov/documents-forcomment/. Comments are due 05/31/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-18/pdf/2018-10663.pdf. Federal Register, Vol. 83, No. 97, 05/18/2018, 23275.

NCUA Finalizes Amendments to Involuntary Liquidation of Credit Unions and Claims Procedures.

The National Credit Union Administration (NCUA) finalized amendments to part 709 of its rules to update and clarify the procedures that apply to claims administration for federally insured credit unions that enter involuntary liquidation. Specifically, the final rule amends the payout priority provision by specifying the conditions that claims in the nature of severance must meet to be allowed as provable claims. The final rule is effective 06/29/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-30/pdf/2018-11588.pdf. Federal Register, Vol. 83, No. 104, 05/30/2018, 24651-24652.

NCUA Proposes Payday Alternative Loans.

NCUA proposed to amend the NCUA’s general lending rule to provide federal credit unions (FCUs) with an additional option to offer payday alternative loans (PALs). This proposal would not replace the current PALs rule (PALs I). Rather, it would be an alternative option, with different terms and conditions, for FCUs to offer PALs to their members. Specifically, this proposal (PALs II) would differ from PALs I by modifying the minimum and maximum amount of the loans, modifying the number of loans a member can receive in a rolling six-month period, eliminating the minimum membership requirement, and increasing the maximum maturity for these loans. NCUA is proposing to incorporate all other requirements of PALs I into PALs II. NCUA is also soliciting comments from interested stakeholders on the possibility of creating a third PALs loan program (PALs III), which could include different fee structures, loan features, maturities, and loan amounts. Comments are due 08/03/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-04/pdf/2018-11591.pdf. Federal Register, Vol. 83, No. 107, 06/04/2018, 25583-25587.

NCUA Announces Funding Availability for Community Development Revolving Loan Fund.

NCUA announced the availability of funding for Low-Income Designated Credit Unions (LICUs) Applications for loans and technical assistance grants under the Community Development Revolving Loan Fund (CDRLF) program. The CDRLF program serves as a source of financial support in the form of loans and technical assistance grants that better enables LICUs to support the communities in which they operate. Important program application dates may be viewed in the table in the notice. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-31/pdf/2018-11689.pdf. Federal Register, Vol. 83, No. 105, 05/31/2018, 25056-25060.

NCUA Requests Comment on Information Collection.

NCUA announced it seeks comment on the information collection titled Joint Standards for Assessing the Diversity Policies and Practices. NCUA also gave notice that it sent the collection to OMB for review. Comments are due 07/05/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-06-04/pdf/2018-11935.pdf. Federal Register, Vol. 83, No. 107, 06/04/2018, 25721.

Agriculture Requests Comment on Information Collection.

The Department of Agriculture (Agriculture) announced it seeks comment on the information collection titled Rural Community Development Initiative (RCDI). Agriculture also gave notice that it sent the collection to OMB for review. Comments are due 06/20/2018. The notice may be viewed at: https://www.gpo.gov/fdsys/pkg/FR-2018-05-21/pdf/2018-10675.pdf. Federal Register, Vol. 83, No. 98, 05/21/2018, 23414. 

By, Ally Bates

As a service provided exclusively to members, WBA offers legal information through its call program in response to compliance questions. The following questions and answers feature some recent frequently asked questions WBA has received through this program.

Q: Can a power of attorney act on an IRA account?

A: Yes, but only if the power of attorney (POA) agreement permits it.

The extent of an agent’s authority to act under a POA agreement will always depend on the language within the agreement. It is very important that bank obtain a copy of any POA agreement presented and review the language within in order to determine the extent of the powers the agent has been granted. If a financial institution is unable to interpret the POA agreement WBA recommends working with an attorney to receive a legal opinion.

Wisconsin’s Uniform Power of Attorney for Finances and Property Act under Chapter 244 governs POA agreements in Wisconsin. Chapter 244 provides for general authority with respect to banks and other financial institutions. One general power granted under statute permits an agent certain actions on an account. Account is a defined term under Wis. Stat. 705.01(1). That definition is broad enough to include an IRA.

Q: Can a power of attorney act on a trust account?

A: Yes, but only if the power of attorney (POA) agreement permits it.

Similar to the analysis above required to determine whether an agent can act on an IRA account, the ultimate authority of an agent depends on the language within the POA agreement. Meaning, an agent can act on an account owned by a trust if the agent has been granted authority to do so.

One additional consideration to make is that of granting authority. A trust is a separate legal entity from an individual, meaning it has its own interests and authorities distinct from that of an individual person. A power of attorney agreement creates authority between a principal (the person granting authority) and an agent (the person granted authority). A POA agreement giving authority to act on the finances of a natural person principal does not automatically mean the agent can act on accounts owned by a trust, even if the principal is a trustee of the trust. Because a trust account has its own authority and ownership interests, the principal must grant an agent authority to act through their powers as trustee. Authority to do so is derived from the trust agreement.

Thus, in order for an agent to act on a trust account, the POA must give them authority to do so, and that power must be permissible through the trust agreement.

Q: How is the section titled “to be completed by the financial institution (for an application taken in person):” of the Home Mortgage Disclosure Act’s (HMDA) demographic information collection form completed when an application is not taken in person?

A: It is not completed unless the financial institution has a face-to-face meeting with the applicant before completion of the application process.

HMDA requires a financial institution to obtain certain demographic information from applicants. If the applicant does not provide that information, the financial institution must collect it based on visual observation. When this occurs, the financial institution must also complete the bottom section of the collection form indicating that the applicant’s ethnicity, race, and sex was collected on the basis of visual observation or surname. For applications not taken in person, when the applicant does not provide this required information, and the financial institution does not have a later opportunity to collect it based on visual observation, this bottom portion of the form is not completed.

However, if the financial institution has a face-to-face meeting prior to conclusion of the application process, it must request the applicant’s ethnicity, race, and sex. If the applicant does not provide the requested information during the in-person meeting, it must be collected on the basis of visual observation or surname. If such a meeting occurs after the application process is complete, for example, at closing or account opening, the financial institution is not required to obtain the applicant’s ethnicity, race, and sex, and thus, not required to complete the bottom portion of the demographic information form.

Q: What considerations apply to a non-resident alien loan applicant?

A: Bank’s loan policy should discuss lending to non-resident aliens. Fair Lending and the Equal Credit Opportunity Act (ECOA) should also be considered.

The Fair Lending Act prohibits discrimination based on race, color, national origin, religion, sex, familial status, and disability. It does not include immigration status. ECOA, implemented by Regulation B, indicates in 1002.6(b)(7) that a creditor may consider the applicant’s immigration status or status as a permanent resident of the United States, and any additional information that may be necessary to ascertain the creditor’s rights and remedies regarding repayment.

So, a financial institution may consider immigration status when deciding whether to extend credit to a non-resident alien. However, lenders should be cautious that when making a credit decision, it is not based on any prohibited basis. For example, denying a loan to an immigrant based on their country of origin, rather than their status as an immigrant, would be a violation.

The commentary to Regulation B provides that the applicant’s immigration status and ties to the community (such as employment and continued residence in the area) could have a bearing on a creditor’s ability to obtain repayment. Accordingly, the creditor may consider immigration status and differentiate, for example, between a noncitizen who is a long-time resident with permanent resident status and a noncitizen who is temporarily in this country on a student visa.

The extent to which a creditor makes this consideration depends on a financial institution’s loan policy. For example: does the financial institution have jurisdiction over the non-resident alien? If they are not a US-citizen, would bank be able to initiate proceedings against them? Are they a flight risk? What if their plans change and they return to their country of origin? Will bank be able and willing to pursue them if the loan goes into default?

These are questions that bank is permitted to ask, but their consideration depends on loan policy. Because of the complexities and fact-specific considerations involved, WBA also recommends working with bank’s own counsel when considering lending to non-resident aliens.

Q: If a legal entity customer opens multiple accounts, is a certification as to beneficial ownership required for each new account?

A: Not if certain requirements are met. A financial institution that has already obtained certification from a legal entity customer may rely on that information to fulfill the beneficial ownership requirement for subsequent accounts, provided the customer certifies (in writing or orally) that such information is up-to-date and accurate at the time each subsequent account is opened and the financial institution has no knowledge of facts that would reasonably call into question the reliability of such information.

Q: Is a new certification as to beneficial ownership form required for a change in signors? 

A: Not automatically. Only if the change in signors is the result of a change in the control person or a beneficial owner. A signer who is removed or added that is not the result of a change in control person or beneficial owner is not a new account or otherwise a triggering event.

Q: Is an extension, modification, or similar arrangement treated as a renewal per the April 3, 2018 FAQ?

A: Probably. The April 3, 2018 FAQ issued by FinCEN indicates that rollovers or renewals are considered new accounts for purposes of the rule. Due to the similarities in documentation and treatment of an extension, modification, or similar arrangement it is WBA’s understanding that such continuations would be similar enough to a renewal to be considered a new account.

Q: Are loans or CDs opened prior to May 11, 2018 that automatically renew or roll over before August 9, 2018 exempt from the Customer Due Diligence (CDD) rule?

A: Yes.

The Financial Crimes Enforcement Network (FinCEN) issued new guidance on May 16, 2018 providing temporary relief from the requirements of its new CDD rule for certain types of accounts. Under the guidance, financial institutions who have accounts that were opened prior to May 11, 2018 but automatically roll over or renew in the next 90 days are not required to comply with the CDD rule until August 10, 2018. 

FinCEN did not elaborate on the use of the word “automatically” but the guidance does discuss concern expressed by some financial institutions over their ability to comply with the rule because they had established automatic processes. WBA’s understanding is that the temporary limited relief is in response to that concern regarding automatic processes. FinCEN will utilize those 90 days to review automatic renewals further.

Conclusion

If you have any questions related to these, or other compliance topics, please do not hesitate to call at 608-441-1200. 

This article is from the June 2018 Compliance Journal, you can download the entire issue by clicking here.

By, Ally Bates

The June 2018 edition of the WBA Compliance Journal has been published.

This month's Special Focus articles addresses the answers to recent frequently asked questions WBA has received through the Legal Call Program. Regulatory Spotlight includes finalized amendments to the securities transactions settlement cycle. Recent actions by WBA, including the submission of an amicus brief to the Wisconsin Supreme Court and a comment on CFPB's rulemaking process, are discussed in Compliance Notes.

Click here to download this month's Compliance Journal.

By, Ally Bates

Q: Are non-profit corporations covered by the customer due diligence requirements for certification of beneficial ownership?

A: Yes. All corporations that file articles of incorporation with the State of Wisconsin are covered by the Customer Due Diligence (CDD) Rule regardless of non-profit status.

The CDD Rule requires covered financial institutions to develop written procedures to identify and verify beneficial owners of legal entity customers upon opening of new account. A legal entity customer is described, in part, as a Corporation, limited liability company, or other entity that is created by the filing of a public document with a Secretary of State. Thus, a non-profit corporation would be a legal entity customer for purposes of the CDD rule.

The key determination is whether the customer is a "legal entity customer." Tax status, such as non-profit status, does not directly affect a customer's legal entity status. Meaning, a non-profit organization such as a church could decide to incorporate, file articles of organization, or otherwise file with the State and be covered by the CDD Rule. Typically, however, a non-profit organization will opt for an unincorporated association status. Unincorporated associations are not legal entity customers and are not covered by the CDD rule. Wisconsin's Uniform Unincorporated Nonprofit Association Act can be found under chapter 184 of the Wisconsin Statutes.

For this reason, non-profits are often exempt from the CDD rule. This is, however, by their decision to organize as an unincorporated association rather than their tax status.

Note: The above information is not intended to provide legal advice; rather, it is intended to provide general information about banking issues. Consult your institution's attorney for special legal advice or assistance.

By, Scott Birrenkott

Markesan State Bank is pleased to announce the hiring of Megan Connor. Connor joins the lending team as a Consumer/Residential Lender in our Randolph Branch. Her primary areas of lending will be focused on Residential and Consumer Lending.

Connor comes to Markesan State Bank with over 7 years of mortgage lending experience. 

Connor holds an Associate’s degree from Madison Area Technical College and comes to us with a vast knowledge of the mortgage lending industry. She is excited about taking her knowledge and skills to assist people in finding and creating their dream homes.

Connor grew up south of Madison, WI and moved to the Fox Lake area in 2010. She enjoys supporting her children in their school related activities, gardening, and restoring classic trucks.

View Bulletin Board.

By, Ally Bates

WBA continues to monitor the implementation of the Wisconsin Department of Health Services (DHS) updated Medicaid Asset Verification Data Matching program (AVS). In July 2017, DHS informed WBA that AVS was being temporarily suspended due to the expiration of the contract between DHS and its data match vendor Health Management Systems Inc. DHS has selected a new vendor, Accuity Asset Verification Services, and sent out a letter with more information Monday, April 9, 2018.

Accuity Asset Verification Services sent emails to Wisconsin financial institutions on Friday, April 27. These emails are valid, and part of the AVS implementation process. WBA has since spoken with DHS and learned that these emails went to previous contacts Accuity Asset Verification Services had with each individual financial institution. As a result, the email may have been missed. 

DHS is implementing AVS next month, and Accuity Asset Verification Services will follow up with another email next month to correspond with the implementation. If a financial institution has not received the April 27 email, WBA recommends reaching out directly to avs.support@accuity.com or 855-807-9822. DHS has also informed WBA that financial institutions may contact Autumn Arnold at Autumn.Arnold@dhs.wisconsin.gov.

By, Eric Skrum