Rose Oswald Poels By Rose Oswald Poels

Last week, the Federal Reserve Board (FRB), Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC) released a joint statement proposing changes to the Community Reinvestment Act (CRA) regulations. The joint proposal would both strengthen and modernize the regulations by expanding access to credit, investment, and basic banking services; adapt to internet and mobile banking changes; provide greater clarity and consistency with both banks and their customers; and create unique CRA evaluations requirements.

The CRA, originally enacted in 1977, encourages banks and savings associations to help meet the need of all borrowers — including low- and moderate-income individuals. In recent years, the industry has seen the agencies attempt to modernize CRA to better address new technologies and community-investment opportunities. However, those efforts left much frustration for the industry when OCC implemented its own “updated” CRA regulation in June 2020, while FDIC and FRB retained existing standards, interpretations, and regulations.

WBA advocated heavily against separate CRA regulations in meetings with the agencies and in filed comment letters. Successfully, late last year, OCC repealed its independent CRA regulation and now the agencies are once again acting together in proposing a unified CRA regulation. I am pleased to see the expansion of transparency between agencies.

The new joint proposal has the following key elements:

  • Expand access to credit, investment, and basic banking services in low- and moderate-income communities. Under the proposal, the agencies would evaluate bank performance across the varied activities they conduct and communities in which they operate so that CRA is a strong and effective tool to address inequities in access to credit. The proposal would promote community engagement and financial inclusion. It would also emphasize smaller value loans and investments that can have high impact and be more responsive to the needs of LMI communities.
  • Adapt to changes in the banking industry, including internet and mobile banking. The proposal would update CRA assessment areas to include activities associated with online and mobile banking, branchless banking, and hybrid models.
  • Provide greater clarity, consistency, and transparency. The proposal would adopt a metrics-based approach to CRA evaluations of retail lending and community development financing, which includes public benchmarks, for greater clarity and consistency. It also would clarify eligible CRA activities, such as affordable housing, that are focused on LMI, undeserved, and rural communities.
  • Tailor CRA evaluations and data collection to bank size and type. The proposal recognizes differences in bank size and business models. It provides that smaller banks would continue to be evaluated under the existing CRA regulatory framework with the option to be evaluated under aspects of the new proposed framework.
  • Maintain a unified approach. The proposal reflects a unified approach from the bank regulatory agencies and incorporates extensive feedback from stakeholders.

I highly encourage you to join WBA in commenting on this joint proposal by August 5, 2022. Please contact WBA’s Heather Mackinnon, vice president – legal, at hmackinnon@wisbank.com and Scott Birrenkott, assistant director – legal, at sbirrenkott@wisbank.com if you have any questions regarding the proposed regulation updates.

FDIC-supervised banks must now report digital asset ventures

By Scott Birrenkott

Q: Is a Financial Institution Required to Notify Its Regulator When Engaging in Activities Involving Crypto Assets?

A: Yes. FDIC-supervised institutions are required to provide notification, along with certain information, when engaged in any activities involving crypto assets (digital assets). In turn, the FDIC reviews this information to provide relevant supervisory feedback.

While this requirement applies to FDIC-supervised institutions, non-FDIC supervised institutions should still consider proactively working with their prudential federal regulator. As innovations in the space of digital assets continue to develop, and financial institutions explore new relationships, working directly with your regulator is an important step to understanding compliance expectations. Digital assets present potentially unique safety and soundness risks, as well as financial stability concerns, and consumer protection considerations. The FDIC intends to review information provided in order to work with the financial institution engaged in digital asset activities as appropriate.

Wisconsin Department of Financial Institutions (DFI) is also considering digital asset activity. While there are currently no specific Wisconsin requirements or notification requirements, Wisconsin financial institutions should still consider working proactively with the DFI when engaged in digital assets. While both state and federal regulators support innovations, this is an area that is rapidly evolving, and often misunderstood. Transparent communications between financial institutions and their regulators can help address any potential compliance or safety and soundness concerns.

The new FDIC notice requirements can be found under Section 39 of the Federal Deposit Insurance Act, 12 CFR Part 364.

Community State Bank’s Kenosha Market President Robert Pieroni was recently awarded the 2021 Racine County Economic Development Corporation (RCEDC) Lender of the Year Award. Pieroni was presented with the award at RCEDC’s Annual Meeting on April 14th, 2022. This is the second consecutive year that Pieroni has received the award.

The RCEDC Lender of the Year Award is presented annually to an individual that assists small businesses in the community by partnering with RCEDC’s financial arm, Business Lending Partners, who facilitates low interest loans throughout Racine County.

“Being able to support and guide local business owners towards building their dream is one of the best parts of being a community banker,” said Pieroni. “RCEDC and Business Lending Partners have been great resources for our bank and local business owners. I appreciate their partnership and also am very grateful to be chosen once again for this award.”

Pieroni has been in the banking industry for over 20 years focusing in the Kenosha County area, but also assisting local businesses in the Racine and Kenosha corridor. He began at Community State Bank in 2018 as market president of the Kenosha location.

Pieroni also has a long history of being involved in the community by dedicating his time towards local organizations such as Kiwanis Breakfast Club of Kenosha (21 years), Cub Scout Pack 328 (6 years), Central Falcons Trap and Skeet Team, and also serving as commissioner for the Town of Brighton.

“At Community State Bank we seek ways to provide opportunity to our customers, businesses, and communities,” said CSB President and CEO Scott Huedepohl. “One of the ways we do this is by connecting local business owners to community organizations that can help their business succeed. Robert does a fantastic job of making those connections and realizing the impact it has on our community when we work together. Congratulations Robert on your award.”

Award winners were selected by the RCEDC board of directors. For more information about the RCEDC Annual Meeting and other award recipients please visit RCEDC.org.

How your bank can prevent financial crimes

By Scott Birrenkott

Q: What Tools are Available to Banks to Help Deter Financial Crimes?

A: Part of Bank Secrecy Act (BSA) regulations establish procedures for information sharing to deter money laundering and terrorist activity.

As financial institutions continue to monitor Office of Foreign Assets Control (OFAC) lists regarding sanctions and other restrictions, don’t forget to monitor for information sharing requests through Section 314 of the USA PATRIOT Act. Pursuant to section 314(a) law enforcement agencies may request that the Financial Crimes Enforcement Network (FinCEN) solicit, on its behalf, certain information from financial institutions.

Upon receiving an information request, a financial institution must conduct a one-time search of its records to identify accounts or transactions of a named suspect. Generally, financial institutions must search records for current accounts, accounts maintained during the preceding 12 months, and transactions conducted outside of an account by or on behalf
of a named suspect during the preceding six months. If a financial institution identifies any account or transaction, it must report to FinCEN that it has a match. No details should be provided to FinCEN other than the fact that the financial institution has a match. A negative response is not required. Unless otherwise provided, the search and response must be conducted within 14 days.

Financial institutions should also consider that FinCEN issued an alert on March 7 to be vigilant against efforts to evade the expansive sanctions and other U.S.-imposed restrictions implemented in connection with the Russian Federation’s further invasion of Ukraine. The advisory warns of evasion attempts and that “sanctioned Russian and Belarusian actors may seek to evade sanctions through various means, including through non-sanctioned Russian and Belarusian financial institutions and financial institutions in third countries.”

FinCEN also provides several red flag indicators to watch for attempted evasions. Select red flag indicators include for transactions initiated from IP addresses located in Russia, Belarus, or other sanctioned jurisdictions, transactions connected to convertible virtual currency (CVC) addresses listed on OFAC lists of specially designated nationals and blocked persons, and customer use of a CVC exchanger or foreign-located money service businesses in a high-risk jurisdiction.

Rose Oswald PoelsBy Rose Oswald Poels

In two separate publications, FDIC has recently identified deposit-related activities which, depending upon how banks disclose charges for such activities, may result in a heightened risk of violations of Section 5 of the FTC Act — otherwise known as unfair, deceptive, or abusive acts or practices (UDAAP).

FDIC has identified the assessment of overdraft fees for “force pay” transactions and charging multiple NSF fees for same transactions presented multiple times against insufficient funds as the deposit-related activities of concern. I have outlined both scenarios below.

Potential Issues with Assessing Overdraft Fees for “Force Pay” Transactions  

In a quarterly newsletter issued by its Dallas Region, FDIC outlined potential issues with assessing overdraft fees for “force pay” transactions in certain situations. There may be times when a bank authorizes an ATM or one-time POS debit card transaction based on sufficient funds in a consumer’s account at the time of authorization; however, at settlement, the account has insufficient funds to cover the transaction. Due to a bank’s contract with its payment network providers, the bank is required to pay these transactions even though the customer does not have sufficient funds in their account at settlement. FDIC refers to this type of transaction as a “force pay” transaction.

As outlined by FDIC, some banks have a policy and practice of declining to authorize and pay any ATM or one-time POS debit card transactions when a customer has insufficient funds available in the account to cover the transaction. FDIC refers to these banks as “no pay” banks. Other banks may offer an overdraft program, but some consumers do not qualify, have not yet met all eligibility requirements, or do not opt-in to participate.

FDIC has identified that some “no pay” banks solicit a consumer’s authorization or opt-in, using an overdraft opt-in form similar to the Regulation E model form A-9, to assess overdraft fees for ATM and one-time POS debit card transactions in “force pay” transactions.

FDIC stated it believes the use of the A-9 model form for this purpose may be considered deceptive, as a reasonable consumer may be misled into believing that the bank would generally pay all overdrafts caused by ATM and one-time POS debit card transactions. Additionally, the A-9 model form does not disclose that force pay transactions would be paid regardless of whether the consumer opts in. FDIC also identified how force pay transactions could lead to concerns at banks that offer overdraft programs, although those are more nuanced transactions and are not discussed here.

FDIC offered the following suggestions to mitigate risks:

  • Maintain policies and procedures to ensure compliance with applicable regulatory requirements under Regulation E;

  • Ensure that disclosures provided to consumers are clear and conspicuous, accurately reflect bank practices, and do not suggest that the bank offers an overdraft program when it does not;

  • Confirm a customer’s opt-in is deactivated in the deposit processing platform when he/she does not have access to the overdraft program;

  • Verify a customer’s opt-in is deactivated in the deposit processing platform when he/she revokes his/her opt-in election or when the bank terminates the customer’s access to the overdraft program; and

  • Notify customers as soon as possible if the bank independently terminates their access to the overdraft program.

Potential Issues with Re-Presentment of Unpaid Transactions 

In a separate publication, Consumer Compliance Supervisory Highlights, FDIC outlined potential issues with charging multiple NSF fees for re-presentment of unpaid transactions. FDIC found disclosing that one NSF fee would be charged “per item” or “per transaction” is not clearly defined and did not explain that the same transaction might result in multiple NSF fees if re-presented. FDIC stated it believes there is risk of unfairness if multiple fees are assessed for the same transaction in a short period of time without sufficient notice or opportunity for consumers to bring their account to a positive balance.

FDIC also addressed that re-presented transactions have been the subject of recent class action lawsuits involving banks, including FDIC-supervised institutions. The lawsuits typically allege breach of contract due to the omission of important information about when the fee would be assessed.

FDIC again offered suggestions to mitigate risks, including:

  • Eliminating NSF fees

  • Declining to charge more than one NSF fee for the same transaction, regardless of whether the item is represented

  • Disclosing the amount of NSF fees and how such fees will be imposed, including:

  • Information on whether multiple fees may be assessed in connection with a single transaction;

  • The frequency with which such fees can be assessed; and

  • The maximum number of fees that can be assessed in connection with a single transaction.

  • Reviewing customer notification practices related to NSF transactions and the timing of fees to provide the customer with an ability to avoid multiple fees for re-presented items

  • Conducting a comprehensive review of policies, practices, and disclosures related to re-presentments to ensure the manner in which NSF fees are charged is communicated clearly and consistently

  • Working with service providers to retain comprehensive records so that re-presented items can be identified

Conclusion 

I would not recommend the use of Regulation E model form A-9 as a means to obtain a consumers’ authorization or opt-in for a force pay transaction. There is not a model form for such transactions and banks need to review how best to disclose their practice for force pay transactions with their counsel. For banks offering overdraft programs, banks need to be careful how it treats a consumer’s opt-in if the opt-in election was provided but access to the overdraft protection coverage has not yet begun and when the bank terminates access to the overdraft program.

I would also recommend banks review their deposit account disclosures, statement of fees, and account rules documents to further determine how to accurately disclose an NSF fee on a re-presented item, if applicable.

If using FIPCO forms, the WBA 384 Deposit Account Rules document was revised in March 2021 to further clarify that a financial institution may charge a fee each time the same check, transfer request, or withdrawal request is returned unpaid. Language was also added to state that the depositor should review the schedule of fees for a listing and amount of such fees. Additionally, the revised form instruction also set forth that if the user intends to charge a fee each time the same check, transfer request, or withdrawal request is returned unpaid, it is important that the schedule of fees explains the financial institution’s intent to charge a fee each time rather than one fee regardless of the number of times the check, transfer request, or withdrawal request is returned unpaid.

If scrutinized by a regulator for charging multiple NSF fees for a re-presented item, I recommend the bank explain to the regulator the actual presentment process and any inability to identify items resubmitted by a merchant for payment.

By Scott Birrenkott

Q: What is an Acceptable Form of Customer ID for CIP Purposes?

A: It depends on bank policy, but there are various forms of ID that can meet CIP requirements.

As part of compliance with Bank Secrecy Act regulatory requirements, banks must have a written Customer Identification Program (CIP). Bank’s CIP must include risk-based procedures to verify the identity of each customer at account-opening. At a minimum, each program must obtain the name, date of birth, address, and identification number from each customer. This information must be verified, using documentary, non-documentary, or a combination of both methods, depending on bank’s procedures.

When relying upon documentary methods to verify a customer’s identity, bank’s procedures must specify which documents to obtain. Similarly, if procedures permit non-documentary methods, bank’s procedures must specify which methods to use. A bank need not establish the accuracy of every element of identifying information obtained, but it must verify enough information to form a reasonable belief that it knows the true identity of the customer. For most customers who are individuals, banks typically review an unexpired government issued form of identification evidencing a customer’s nationality or residence and bearing a photograph or similar safeguard. Nondocumentary methods may include contacting a customer, or otherwise independently verifying the customer’s identity through other sources.

A bank may encounter unique forms of identification. What forms are acceptable depends upon bank policy. Theoretically, any legitimate form of identification could be acceptable. Examples include state-issued driver’s license, state-issued ID card, passport, and alien ID card. There are also a variety of forms issued by the United States Citizenship and Immigration Services. For example, the U.S. Department of Homeland Security may provide certain records to refugees or asylees, who may also possess identification documents through the United States Citizenship and Immigration Services. These, and other forms of identification may be acceptable for CIP purposes if bank’s policy permits.

Wisconsin DFI sets escrow interest rate at 0.09% for 2022

By Scott Birrenkott

Q: Has the Wisconsin Department of Financial Institutions set the Interest Rate on Required Residential Mortgage Loan Escrow Accounts for 2022?

A: Yes. The Wisconsin Department of Financial Institutions, Division of Banking (DFI), has calculated the interest rate required to be paid on escrow accounts for residential mortgage loans subject to Wisconsin Statute Section 138.052(5) to be 0.09% for 2022. The interest rate shall remain in effect through December 31, 2022.

Note that while Wisconsin Section 138.052 previously required financial institutions to pay interest on the balance on any required escrow accounts, Wisconsin Act 340 modified this requirement so that it only applies to loans originated prior to the effective date of the Act (April 18, 2018). Thus, financial institutions must continue to pay interest on required escrow accounts prior to April 18, 2018. Any escrow account associated with a loan originated after the effective date of Act 340, 138.052 no longer requires payment of interest. Wis. Stat. Section 138.052 applies to loans secured by a first lien or first lien equivalent in a 1-4 family dwelling that is used as the borrower’s principal residence.

The escrow rate notice may be found here.

On January 28, SBA released Procedural Notice 5000-827666 regarding SBA loan reviews of PPP Lender partial approval forgiveness decisions. The notice outlines a new process to allow PPP Borrowers to request an SBA loan review of partial approval forgiveness decisions issued by their PPP Lenders. The procedures in the notice apply to loan forgiveness decisions submitted by Lenders to SBA through both the regular forgiveness process as well as the Direct Borrower Forgiveness process. The notice is effective January 27, 2022.

The notice reiterates the process for a partial approval forgiveness decision and the steps that need to be taken by the Lender when it receives a forgiveness application from a Borrower. The notice also outlines a new process for borrower requests of SBA loan review of a partial approval forgiveness decision.

Starting from the effective date of the notice, when a Lender receives a forgiveness remittance from SBA on a partial approval decision, including where the Lender required the borrower to apply for forgiveness in an amount less than the full amount of the loan, the Lender’s post-forgiveness remittance notification must inform the borrower that the borrower has 30 calendar days from receipt of the notification to seek, through the Lender, an SBA loan review of the Lender’s partial approval decision. Within five calendar days of a Lender’s receipt of a borrower’s timely request for an SBA loan review, the Lender must notify SBA through the Platform. The Lender’s notice to SBA of the borrower’s timely request for review must include a copy of the Lender’s notice to the borrower of the reason(s) for the Lender’s partial approval decision. SBA reserves the right to review the Lender’s decision at its sole discretion.

Additionally, within 30 calendar days of the date of the notice, Lenders must notify all of their borrowers on loans that previously received a partial forgiveness remittance from SBA as a result of Lender partial approval decisions, including where the Lender required the borrower to apply for forgiveness in an amount less than the full amount of the PPP loan, that the borrower has 30 calendar days from receipt of the Lender notification to seek, through the Lender, an SBA loan review of the Lender’s partial approval decision. Within five calendar days of the Lender’s receipt of a borrower’s timely request for an SBA loan review, the Lender must notify SBA through the Platform. The Lender’s notice to SBA of the borrower’s timely request for review must include a copy of the Lender’s prior notice to the borrower of the reason(s) for the Lender’s partial approval decision. Again, SBA reserves the right to review the Lender’s partial approval decision at its sole discretion.

In either circumstance, if SBA selects the loan for an SBA loan review as a result of the borrower’s request, the borrower must continue to make payments on the remaining balance of the loan, and the loan is not deferred.

If SBA determines, as a result of the SBA loan review, that the borrower is entitled to forgiveness in an amount greater than the Lender’s partial approval decision and SBA has previously remitted a partial forgiveness payment to the Lender, SBA will remit an additional forgiveness payment to the Lender to make up the difference. SBA will issue an additional Notice of Paycheck Protection Program Forgiveness Payment (Payment Notice) to the Lender.

If the SBA loan review results in a higher forgiveness amount, but less than full forgiveness, SBA will also issue a final SBA loan review decision to the Lender. The Lender must provide a copy of the Payment Notice and, if applicable, the final SBA loan review decision, to the borrower within 5 business days of the remittance and comply with applicable requirements of the Lender Responsibilities Notice. If a borrower has begun making payments on their loan and the SBA loan review results in full forgiveness, the Lender must refund all payments made by the borrower.

If the SBA loan review results in a higher forgiveness amount, but less than full forgiveness, the lender must re-amortize the PPP loan and refund any excess payments made by the borrower.

Note: PPP Borrowers that have received full denial forgiveness decisions from their Lenders should continue to follow the process outlined in the Interim Final Rule on Loan Forgiveness Requirements and Loan Review Procedures as amended by the Economic Aid Act (86 FR 8283, February 5, 2021), as amended.

Lenders may call the Lender Hotline at (833) 572-0502 for live assistance regarding PPP access and support, policy questions and procedures, and Capital Access Financial System (CAFS) and SBA’s Electronic Transmission (E-Tran) systems support. Questions concerning the notice may be directed to the Lender Relations Specialist in the local SBA Field Office.

Notice 5000-827666 is posted on the WBA website.

Triangle Background

By Rose Oswald Poels

In a four-three opinion filed late last week, the Wisconsin Supreme Court concluded that a “dwelling used by the customer as a residence” under the Wisconsin Consumer Act (WCA) includes a garage attached to the residential building in which the customer lives for purposes of rules that need be followed when creditors proceed with nonjudicial repossession.

On behalf of the membership, WBA participated as an amicus curie in the case of Duncan v Asset Recovery Specialists, Inc. as the case involved the interpretation of statutory language used within the repossession rules of the WCA.

The facts of the case were undisputed by the parties and include that Duncan purchased a vehicle from a dealership; she financed the purchase with a loan. Duncan failed to make payments that came due and eventually was in default. The vehicle served as collateral for the loan, and the bank followed the procedure allowed under Wisconsin law for a “nonjudicial” repossession under Wis. Stat. §425.206(1)(d). The bank met all statutory requirements to proceed with nonjudicial repossession and ultimately retained Asset Recovery Specialists to repossess Duncan’s vehicle. At the time, Duncan rented an apartment unit in a multi-story apartment building. The ground floor of the building consisted entirely of a private parking garage for tenants, and Duncan sometimes kept her vehicle in it.

The central dispute between the parties is whether Asset Recovery Specialists violated Wis. Stat. §425.206(2)(b) when they entered the garage shared by residents in Duncan’s apartment building to repossess her vehicle. The court reviewed language within §425.206(2) which provides in full: In taking possession of collateral or leased goods, no merchant may do any of the following: (a) Commit a breach of the peace. (b) Enter a dwelling used by the customer as a residence except at the voluntary request of a customer. The court focused its review on the statutory language in italics.

Although “dwelling” is undefined in the WCA, the court looked to the word’s ordinary, dictionary definition, and to the use of the word in other sections of the WCA and its Administrative Code. In taking that approach, the court concluded a “dwelling” means, at minimum, a building in which at least one person lives. In proceeding in this manner, the court concluded that “dwelling used by the customer as a residence” in Wis. Stat. §425.206(2)(b) includes a garage attached to the residential building in which the customer lives. In making its conclusion, Asset Recovery Specialists was found to have violated §425.206(2)(b) when they repossessed Duncan’s car from the parking garage of her apartment building without her consent.

While I am disappointed in the court’s opinion, I do not regret WBA’s involvement in the case as an amicus on behalf of the membership as the court’s opinion does offer clarity of the term “dwelling.” This in turn helps members further fine-tune any nonjudicial repossession procedures. Fortunately, Wisconsin’s banks are not heavily engaged in nonjudicial repossession of vehicles, so the impact of the court’s decision in this context I believe is likely minimum. That said, as the effect of the court’s decision broadens the plain language of Wis. Stat. §425.206(2)(b), banks need be aware of the court’s new interpretation to ensure there is no violation of the WCA when repossessing vehicles in a similar setting.

The Wisconsin Supreme Court opinion may be viewed here.

By Scott Birrenkott

Q: Has CFPB Released its Truth in Lending (Regulation Z) Annual Threshold Adjustments for 2022?

A: Yes. The Consumer Financial Protection Bureau has revised the threshold dollar amounts for Regulation Z, which implements the Truth in Lending Act (TILA). Specifically, has revised the dollar amounts for provisions implementing amendments to TILA under the Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD Act), the Home Ownership and Equity Protection Act (HOEPA) and the ability to repay/qualified mortgage (ATR/QM), and the dollar threshold for exempt consumer credit transactions. Effective January 1, 2022, the following thresholds will be adjusted to the new dollar amounts.

For HOEPA loans, the adjusted total loan amount threshold is $22,969, an increase from $22,052 in 2021. The adjusted points and fees dollar trigger for high-cost mortgages is $1,148, an increase from $1,103 from 2021.

For qualified mortgages (QMs) under the General QM loan definition in §1026.43(e)(2), the thresholds for the spread between the annual percentage rate (APR) and the average prime offer rate (APOR) in 2022 will be: 2.25 or more percentage points for a first-lien covered transaction with a loan amount greater than or equal to $114,847; 3.5 or more percentage points for a first-lien covered transaction with a loan amount greater than or equal to $68,908 but less than $114,847; 6.5 or more percentage points for a first-lien covered transaction with a loan amount less than $68,908; 6.5 or more percentage points for a first-lien covered transaction secured by a manufactured home with a loan amount less than $114,847; 3.5 or more percentage points for a subordinate-lien covered transaction with a loan amount greater than or equal to $68,908; or 6.5 or more percentage points for a subordinate-lien covered transaction with a loan amount less than $68,908.

For all categories of QMs, the thresholds for total points and fees in 2022 will be 3 percent of the total loan amount for a loan greater than or equal to $114,847; $3,445 for a loan amount greater than or equal to $68,908 but less than $114,847; 5 percent of the total loan amount for a loan greater than or equal to $22,969 but less than $68,908; $1,148 for a loan amount greater than or equal to $14,356 but less than $22,969; and 8 percent of the total loan amount for a loan amount less than $14,356.

For open-end consumer credit plans under the CARD Act amendments to TILA, the adjusted dollar amount in 2022 for the safe harbor for a first violation penalty fee will increase to $30 and the adjusted dollar amount for the safe harbor for a subsequent violation penalty fee will increase to $41.

Lastly, based on the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers as of June 1, 2021, the dollar threshold for exempt consumer credit transactions under Regulation Z will increase from $58,300 to $61,000 effective January 1, 2022.

If you have any questions on this topic or other matters of compliance, contact WBA’s legal call program at 608-441-1200 or wbalegal@wisbank.com.