The October 2023 WBA Compliance Journal is now available. In this edition, WBA Legal provides a reminder of FinCEN’s BOI Reporting Rule which becomes effective January 2024 and lists resources made available by FinCEN. Also, as disbursements from escrows will begin shortly, readers can review an FAQ to freshen-up on state and federal escrow requirements. The “Regulatory Spotlight” section once again provides a summary of rules, proposals, and notices issued by federal agencies, and the “Compliance Notes” section reports on other important compliance-related updates for bankers, including new CFPB opinions and FRB’s latest Consumer Compliance Outlook regarding representment fees.
By Rose Oswald Poels
As first announced last year, the Wisconsin Bankers Association (WBA) has partnered with several banking trade associations throughout the U.S. to present the Society of Bank Executives. Now wrapping up its inaugural year, the Society has already welcomed more than 125 bank leaders from 13 states — including Wisconsin — into its fold. With evolution touching every aspect of the banking industry, and strong leadership needed now more than ever before, I encourage all bank executive teams in the state to consider the invaluable opportunities offered by the Society of Bank Executives.
The Society, facilitated by Dr. Paul Godfrey of the Brigham Young University Marriott School of Business, aims to provide bank leaders with invaluable professional development opportunities. With two, four-month sessions held each spring and fall, the Society focuses on aiding bank leaders in honing critical leadership competencies and skills as well as connecting members with their peers in a non-competitive setting.
Unlike many other leadership seminars, the Society of Bank Executives is designed with bank leadership teams in mind. The experts leading the Society realize that bank management teams are uniquely positioned within their organization and as such ensure the programing is flexible and applicable to all leaders.
Prior to the start of each session, members are recommended a book to help establish key concepts and ideas for the events ahead. Throughout the four-month session, three 60–90-minute online seminars will aid bankers in building on these takeaways and consider elements related to shareholders, regulators, customers, and communities. These sessions are specifically designed to engage C-level bankers in study, analysis, and application of the “art” of leading a bank.
Additionally, new and returning members alike will benefit from self-paced elements and an expansive online library, which includes access to a number of past sessions and materials related to strategic risk management and trust & team building. Each bank member is also assigned to a peer group with bankers in other states. These peer groups determine additional dates/times to meet virtually to follow up on the facilitated sessions and further share in a banker-only group.
During the third month of each session, members take part in a two-day networking retreat. Last week, the Society hosted its fall 2023 Action Summit in Scottsdale, Arizona. Focused on connecting members with their banking peers from across the country, the Society’s Action Summits build time into the event for networking, facilitated sessions with Dr. Godfrey and other industry thought leaders, and table peer group discussions. Before returning to the bank, attendees also have the chance to develop an action plan.
Of course, networking is not only about building relationships. Again and again, I am reminded of how important it is that bankers of all levels invest in their professional growth and leverage the collective knowledge and opportunities within their network to advance their bank’s success. The Society does just that. I’ve heard from several Society members who have, in just one year, found the program to be beneficial in enhancing their soft skills to effectively lead in an evolving landscape and develop strong bonds with bankers from across the country. I encourage all bank leaders in Wisconsin to utilize this unique opportunity to guide new professional and organizational growth and foster non-competitive partnerships.
With new technology, regulatory updates, and shifting customer expectations emerging each day, the spring 2024 session will focus on change management. As this year’s sessions come to a close, now is the perfect opportunity for bank leaders in Wisconsin to sign on by January 2024 as individual members or as a team to enhance their organization’s ability to implement new strategies and drive the industry forward.
By Landon Turner
Working in the banking industry brings me great joy because I get to wake up every day, knowing that I have a small part in helping businesses thrive in our community. Every business has different values and needs to continue expanding their mission into their community. It’s my job to figure out how we can partner together to live out that mission and continue reinvesting those dollars back into our community. It’s a beautiful cycle.
One of the best pieces of advice I received early on in my career was to get involved early.
As I look back over the last six years in banking, I am reminded how we have people who come into our lives at critical moments to support us in reaching our goals and believing in ourselves.
A critical moment in my life was taking a leap of faith switching majors halfway through my college career, from mechanical engineering to finance. To be honest, I felt like a failure for not finishing what I thought was my big dream, while wasting time and money. But with the help of my mentors, continuous prayer, and those closest to me, I realized something shocking — I was chasing a dream my dad had for my life, not my own.
This moment is when my faith and my community, helped create a path that was well beyond my own understanding.
Everything changed when I took that leap of faith into finance. It created a fire inside my heart to strive for excellence in the work I do, the relationships I build, and the unlimited opportunities I saw for myself.
However, when I graduated with a bachelor’s degree in finance and economics, a career in banking was not in the forefront of my mind. While at Grand Canyon University in a Servant Leadership class, I met my wife. I was born and raised in Arizona; she was from a small town in Wisconsin. Their connections within their community are what helped me land my career in business banking at a community bank in Sheboygan.
Fast forward six years, I have been able to serve at some great organizations in Wisconsin, simply by showing up and getting involved early. Here is what getting involved early has done for my personal and professional development.
I just celebrated four years at Oostburg State Bank, currently serving as a business banking officer. Oostburg State Bank has been instrumental in my professional development through their support and recognition in our community. Our team has been recognized as the SBA Volume Lender of the Year for the past three years, based on our asset size.
My wife and I have been serving as Youth Group Leaders at our local church for the past four years. I have been blessed to see one of my first students now lead a new ministry at our church focused on young adults. I also currently serve as deacon treasurer, where my team and I track giving and forecast our annual budget for the year.
Another opportunity I have been given, is my involvement in BOLT (Building Our Leaders of Tomorrow). I currently serve as vice chair of the board of directors for the BOLT section. The Wisconsin Banking Association’s (WBA) BOLT Section is focused on education, advocacy, and networking for the next generation of bank leaders. Through my involvement in this organization, I have found leadership to be another passion of mine. Our world is in desperate need of strong leaders that are willing to stand firm in their beliefs and guide their team to success.
Everyone has a different definition of success, for some that could mean providing a comfortable lifestyle for their family, for others it could mean building a business from the ground up. For me, if I can see daily improvements in my life; if I am better today than I was yesterday, that is success for me. Success is never complete; it is a continuous process that I work on every day with the decisions I choose to make. BOLT stands to practice muscles for leadership. I compare it to working out in the gym; if you are not routinely in the gym and putting in the work, you will never reach the results you intended to see. If you are not consistently practicing your leadership or learning new skills, you will not become the leader you or your team needs.
I also currently serve as chair for the Young Professionals Committee at the Sheboygan County Chamber of Commerce. Our team helps plan and coordinate events throughout the year for the goal of professional development, volunteerism, and social engagement with the members and businesses of Sheboygan County. I cannot thank the Sheboygan Chamber enough for the opportunities they have presented me to serve others and help me grow in my own professional career.
I am grateful for my past experiences and the people who supported me to take that leap of faith that forever changed my life. Make sure you are developing and learning something you are passionate about, not what others think you should be passionate about.
Turner is business banking officer at Oostburg State Bank and vice chair of the 2023–2024 WBA BOLT Section.
By Rose Oswald Poels
Cyberattacks are becoming an increasingly alarming trend and it is vital that bankers in Wisconsin remain vigilant in safeguarding their institutions and the personal financial information of their customers. In 2022, global cyberattacks increased by 38% when compared to the year prior, notes a study conducted by Check Point Research. These attacks, which target both individuals and businesses worldwide, include phishing, ransomware, breaches, and vulnerability exploitation. Each year, cybercrime costs the U.S. economy billions of dollars.
Despite this, there are many ways in which banks are able to mitigate these risks if an attack occurs.
Continually monitoring, updating, and testing your systems are all key to ensuring that your people and environments are not vulnerable. In an ever-changing digital and banking world, it may be difficult to know what areas need to be addressed, but it does not have to be. As always, WBA and its subsidiaries — FIPCO and Midwest Bankers Insurance Services (MBIS) — offer many different resources for banks to help educate your employees, protect your systems, and partner with you during a cyber event.
To proactively identify vulnerabilities of critical aspects of business operation, FIPCO offers an IT Audit & Security service. This service, which includes various tests, audits, and resources, keeps your institution one step ahead to mitigate high-risk areas before it is too late.
Right behind robust firewalls, up-to-date antivirus software, and other initiatives to mitigate cyberthreats, are your employees. Ensuring all team members feel empowered to assist in cyber risk reduction efforts should be a significant aspect of an institution’s risk mitigation strategy. Annually, WBA offers a number of security and IT-focused educational opportunities, a best practices library featuring an extensive list of security and financial crimes resources, as well as a technology and operations peer group to help in facilitating discussion and idea sharing.
Ensuring that all team members are set up with strong, unique passwords may also be the difference between a secure organization and a vulnerable one. These passwords, according to the National Institute of Standards and Technology (NIST), should be more than 12 characters long and include mixed casing and numbers. Multifactor Authentication (MFA) is also strongly recommended for bank leaders and administrators, if not every member of the team.
Having comprehensive insurance coverage is also crucial in the event of an attack. MBIS offers an extensive list of insurance coverages, including cyber liability. This policy is designed to protect directors, officers, employees, and entities from losses arising out of electronic theft of customer information, including cyber extortion, forensic expense, security breach notification, e-commerce activity, and electronic publishing. The insurance carriers for cyber liability policies also provide extensive resources that MBIS recommends be immediately engaged in the event of any cyberattack, including phishing incidents and ransomware attacks. Additionally, FIPCO’s Loan Processing Central service provides a resource you can retain ahead of time to immediately step in if a bank experiences a disaster, including a cyberattack, or an unplanned employee absence, to help continue the processing of your loan documentation.
Whether your bank is recovering from a cyber incident or mitigating the chances of one, our team is here to ensure your bank is well-prepared and equipped to navigate the complex and stressful landscape of cybersecurity challenges. If you are interested in learning more about the protections WBA can help you implement at your bank, please contact Rob Foxx (FIPCO) at email@example.com or Jeff Otteson (MBIS) at firstname.lastname@example.org.
By Tyler Leet
When it comes to cybersecurity, a good offense is a key component of a good defense. Much like organizations, hackers continuously learn and hone their skills. So, it’s critical to keep up with the latest threats they deploy, identify potential vulnerabilities, and understand how your bank would respond to an attack. By examining vulnerabilities before a real hacker has the opportunity, your institution can take an offensive approach and mitigate cybersecurity risk.
How to Mitigate Your Bank’s Risk
How can financial institutions take steps to strengthen cybersecurity in the face of evolving threats? Here are several tips to mitigate cybersecurity risk for your institution:
1. Conduct Penetration Tests: During a penetration test, a tester identifies vulnerabilities or security weaknesses and then attempts to leverage them to gain deeper access into your network. Penetration tests often reveal eye-opening results by showing how many points of entry exist across your network.
While still valuable, a vulnerability scan or assessment offers a broader view than a penetration test; however, the results are much more generic. Since a penetration test is more manual and object-oriented, it provides directly actionable information to help you evaluate and resolve weaknesses likely to be leveraged by a malicious individual. Combining these with a layered security approach offers the most protection.
2. Remediate results. Don’t be afraid of the results from a penetration test or vulnerability assessment. Assessments aim to strengthen your approach, not to serve as a pass/fail benchmark. Your institution should analyze the results and remediate any issues for optimal effectiveness. Remediating any issues or critical vulnerabilities after an assessment is a key step in preventing bad actors from exploiting your weaknesses.
3. Prioritize cybersecurity education. Since cybersecurity is a business issue, employees outside the IT department play an important role in cybersecurity. From loan officers to tellers, employees have access to a myriad of systems and are potential targets as a result. While employees don’t have to be cybersecurity experts, it is still beneficial to practice good security hygiene. This is also a cost-effective measure, as the cost of educating users will almost always be less than the cost of dealing with a breach.
Hackers often rely on weak passwords or phishing attacks to gain system access, but educating your users on the latest tactics and common social engineering schemes — and how to report them when spotted — helps mitigate your risk of a successful attack. Ensure your employees and customers remain vigilant when they receive an unexpected email with an urgent message that includes a strange link or attachment, as this is a common hacker tactic.
4. Implement multi-factor authentication. One way to encourage hackers to move on to a different target is making it as difficult as possible to carry out their objective, which is often account access. Multi-factor authentication (MFA) is an excellent way to discourage hackers, as it requires more than a username and password to obtain account access. This additional information can include a token, text message, email, or biometric data such as a face scan or fingerprint. Not only should employees use MFA when accessing your systems and network, but your institution should encourage customers to enable this control on their financial accounts, email accounts, and even social media.
5. Implement patch management. Most bad actors use tools that take advantage of your system vulnerabilities, so it’s important to invest in routine vulnerability and patch management to shore up your defenses. If you remediate a vulnerability, bad actors don’t have an easy way to exploit it and will likely move on to low-hanging fruit elsewhere. Further, good patch management minimizes surface area and attack exposure. While updating your patches can be resource-intensive, it is worth it in the long run. This approach includes encouraging employees to update software, operating systems, applications, etc. to mitigate the risk of hackers taking advantage of any vulnerabilities.
6. Assess your risk. If done properly, risk assessments are a key component of a cybersecurity plan. A risk assessment helps an organization identify and manage financial, operational, and other risks associated with internal and external incidents. And proper risk assessments should be more than filling out a spreadsheet; they’re about the lessons learned along the way as you produce it. During this assessment, you should identify assets you need to protect and understand how controls in place work together. The resulting document should help you prioritize your limited resources.
7. Involve your leaders. Cybersecurity involvement should not be limited to your IT department. Since this issue touches nearly every part of your bank, it’s important to have board and senior management involvement. Senior management should be invested in understanding cybersecurity threats and have enough familiarity with the topic to ask credible questions to IT leaders. Further, they should serve as advocates for your cybersecurity plan and reinforce the importance of education and training at all levels.
When determining the appropriate cybersecurity investment, leaders should consider your institution’s individual objectives, risk assessment and risk appetite — or a representation of how much risk an institution is willing to accept. As an integral component of a holistic approach to IT, security and compliance, IT governance ensures that an institution’s technology and business objectives support its larger strategies.
Finding the Vulnerabilities Before Cyber Criminals
With evolving threats and opportunistic hackers, investing in cybersecurity for your institution should be a priority. Tools like penetration tests and vulnerability assessments should be components of your larger cybersecurity strategy and help you stay ahead of cyber criminals.
Leet is director of Risk and Compliance Services for CSI’s Regulatory Compliance Group. CSI is a WBA Associate Member.
By Cassandra Krause
This article was published on October 3, 2023. Political and legal challenges to student loan forgiveness programs may result in changes to the information below.
Following a Supreme Court decision halting the Biden Administration’s plan to forgive some or all federal student loan debt for tens of millions of borrowers, the pause on student loan payments ended with interest resuming on September 1, 2023 and payments due in October 2023. Many borrowers are resuming payments for the first time since the onset of the COVID-19 pandemic in March 2020 or are making payments for the first time ever. Some borrowers had never accessed their student loan online account and may not have been aware of how much their monthly payments would be or who their loan servicer is.
Beware of Scams
The changes have led to widespread confusion and mistrust of information. Scammers have been quick to exploit the situation by contacting borrowers via phone calls, texts, or emails urging them to act quickly to qualify for false forgiveness offers — pressuring the borrower to divulge passwords and personal information or pay fictitious fees up front. It is important for borrowers to know that the right place to go for information is StudentAid.gov. The U.S. Department of Education and its partners will never ask for a borrower’s StudentAid.gov username and password over the phone, and loan servicers will work with borrowers on repayment options without charging a fee.
Where to Start
If they have not already, borrowers are encouraged by the U.S. Department of Education to take the following steps to get on track with student loan repayment:
- Update your contact information with your loan servicer(s) and on StudentAid.gov and make sure you have an online account set up on each website. Find your servicer(s) by visiting your Dashboard on StudentAid.gov.
- Explore affordable repayment plans and paths to forgiveness. Check out details of the new repayment plan called the Saving on a Valuable Education (SAVE) Plan at StudentAid.gov/save. Compare repayment plans with the Loan Simulator at StudentAid.gov/loan-simulator.
- Enroll (or reenroll) in auto pay on your loan servicer’s website, which will ensure your payment is automatically processed every month, so you don’t miss a payment. Auto pay is optional, but if you choose auto pay, you’ll save 0.25% on your interest rate.
- Check if you qualify for a type of targeted loan forgiveness at StudentAid.gov/forgiveness.
Options Available to Borrowers
Depending on a borrower’s individual situation, several options for income-driven repayment or forgiveness may be available.
- The SAVE Plan is an income-driven repayment plan that calculates the borrower’s monthly payment amount based on their income and family size. The new SAVE Plan replaces the Revised Pay As You Earn (REPAYE) Plan.
- Borrowers who are employed full-time by a qualifying government or not-for-profit organization may be eligible for the Public Service Loan Forgiveness (PSLF) Program after making the equivalent of 120 qualifying monthly payments under an accepted repayment plan. This could include teachers, nurses, doctors, and other medical professionals. Learn more at StudentAid.gov/pslf.
- Disabled borrowers may qualify for Total and permanent Disability (TPD) discharge of federal student loans. Learn more at DisabilityDischarge.com.
- Borrowers whose school closed or who were defrauded by their school may also qualify for discharge of their federal student loans.
Borrowers with additional questions may call the confidential, free hotline offered by the Wisconsin Coalition on Student Debt. The hotline is staffed 8:00 a.m.–4:30 p.m. Monday through Friday and can be reached toll free at 833-589-0750.
By Rose Oswald Poels
For many of us, the beginning of autumn marks back to school. While hundreds of bankers across the state prepare for new professional development opportunities, many of our future colleagues and leaders are as well.
As bankers are well aware, a shrinking talent pool threatens the long-term viability and competitiveness of our industry. Led by Chair Donna Hoppenjan, the Wisconsin Bankers Association (WBA) is encouraging the membership to consider the ways in which we each can engage — or “inspire” — the next generation to consider a career in banking. It is vital that bankers today are proactive in ensuring our industry’s future success by connecting with students and demonstrating the opportunities available to them.
With talent recruitment at the top of mind for many banks, the Association will once again be hosting several “career night” presentations in the coming months. With the goal of closing the gap between students and banking professionals, these upcoming events are open to students interested in learning more about the industry, what careers are available to them, and why the banking industry might be a good fit for them. Starting this fall, and throughout the academic school year, career nights will take place at Marquette University, UW–Eau Claire, UW–Green Bay, UW–La Crosse, UW–Madison, and UW–Whitewater, with the possibility of more locations being added.
If you, or someone from your bank, are interested in partnering with the Association to serve as a panelist at one of these upcoming events, please contact our team.
In addition to directly connecting with students during a career fair or panel presentation, bankers are also encouraged to share opportunities to further students’ experiences and engagement with the banking industry. Internships are a great example of this, and WBA members may post internship job ads at no cost in our Banker’s Marketplace.
Additionally, sharing the Wisconsin Bankers Foundation’s (WBF) fourth annual Agricultural Banking Scholarship opportunity widely among your networks is an easy way to invest in the students who are interested in a banking career and driving our agricultural sector. The application period is open through November 15, 2023, for students currently enrolled at an accredited Wisconsin college, university, or technical college who are pursuing a career related to agribusiness. Two scholarships of $1,500 each are available.
Like our members, WBA is dedicated to ensuring a bright future for the industry. With your help, we can demonstrate the diverse and rewarding career paths available within the banking sector, foster relationships with students eager to explore these opportunities, and provide the necessary support for them to thrive in our industry.
By Lauren Moran
If you are like me, you often consider technology a blessing and a curse. However, when it comes to a small marketing team with an endless to-do list, some recent advancements in technology are welcome conveniences. With staff shortages and conservative budgets becoming more common, artificial intelligence (AI) is allowing marketers to do more with less.
AI: The Game Changer
While the vast capability of AI has yet to be fully uncovered, a variety of industries have benefitted from AI’s automation and agility — especially marketing. Although many banks are approaching AI with caution from a risk perspective, I’d like to share a few AI-driven tools that can help lighten the load of a busy bank marketer. Please be sure to connect with your IT, compliance, and/or risk management teams before diving into any AI platforms.
Writer’s block is no longer a threat. Tools like ChatGPT or Bard can help create content or copy for blogs, email campaigns, webpages, social media posts, or even radio ads by simply writing one line of text explaining what you are looking for.
Illustrator or Photoshop aren’t your strong suits? No problem. Canva has taken what used to be a tedious creative process and has made it quick and easy with boatloads of design templates, pre-sized canvases, and instant background removers. More recent features like “magic design” allow users to insert a photo and have a multitude of custom templates created within seconds. The “text to image” feature lets users type a description of an image and the AI will generate suggested images instantaneously. Both of these tools have proven to be extremely useful, especially for social media content.
My skills as a videographer are limited to filming my kid’s tee ball game, so I need all the help I can get. Have an idea in your head but don’t have the time or film crew to make it a reality? Platforms like Runway can help bring your ideas to life with text-to-video AI-generation. Runway allows users to type in a description of the video footage they’d like to see, and the program generates it on the spot. Other platforms like Fliki can help marketers create a narrated and captioned how-to video that’s ready for the bank’s website or social media in minutes.
In community banking, our people are our greatest asset. However, it can be tough to keep up with current staff headshots to use in marketing materials. AI apps like Fotor can help. With submission of some current casual photos of your staff members, Fotor can spit out 40 or more professional headshots at a cost that’s likely less than a professional photographer’s studio fee.
Need an eye-catching presentation in a flash? Platforms like Tome can help build presentations with a simple description of your subject matter.
AI technology is moving even faster than the community banks who stay on the bleeding edge of new technologies. While it can be hard to keep up, AI can provide bank marketers with the tools to be more efficient and effective in their positions. Who knows, one of the platforms mentioned above could be a game changer in your daily work life.
Moran is marketing director at Wolf River Community Bank, Greenville, and vice chair of the 2023–2024 WBA Marketing Committee.
By Donna Hoppenjan
One of the Association’s primary goals for the year ahead is to continue shaping a solid future for the banking industry. As our members are well aware, the industry has evolved a great deal in the last several years. In order to remain receptive to the development that is yet to come, it is vital that our current bank leaders prioritize their investment into the future success of the industry.
Through the Wisconsin Bankers Association (WBA), over 30,000 bankers across Wisconsin gain access to ongoing educational opportunities. These various schools, workshops, and conferences are designed specifically to aid bankers across the state in gaining leadership skills, expanding their expertise, and serving as advocates on behalf the industry they represent.
As we invest in our emerging leaders and bankers of the future, it is important to provide relevant, high-quality resources and connections. BOLT (Building Our Leaders of Tomorrow) and WBA Connect are just two of the programs WBA offers that combine personal and professional development opportunities with numerous chances to build networks, ask questions, and share ideas. Annually, hundreds of bankers benefit from cultivating relationships with their peers and becoming involved with the Association.
Additionally, bankers may choose to utilize WBA’s Legal Call Program to connect with seasoned attorneys that understand the industry, review best practices created by bankers in Wisconsin, or stay abreast of the latest industry news by subscribing to the Wisconsin Banker Daily e-newsletter or the Wisconsin Banker bimonthly publication.
Beyond developing our current teams, focusing on the future workforce is a priority for many. In order to drive our industry forward, it is critical that bankers commit themselves to promoting banking as a career. Taking part in volunteer work, hosting financial literacy presentations, and connecting with students are just a few meaningful and inspirational actions our membership can highlight when talking about the many rewarding aspects of a banking career. WBA provides resources to help members interact with future bankers including consumer-focused resources, financial education tools, and engagement opportunities at colleges across the state.
As your team considers new ways to invest in your employees and attract new talent, I encourage you to utilize the opportunities provided by WBA. No matter how your bank decides to make the most of WBA’s programs, it is gratifying to know that the success of our institutions and team members is the sole mission of the Association.
Hoppenjan is president and CEO of Mound City Bank, Platteville, and the 2023–2024 WBA Chair.
As autumn arrives, so too does the September 2023 WBA Compliance Journal. In this edition, WBA Legal answers the frequently asked question of who signs a real estate mortgage and how to complete the WBA 428 Real Estate Mortgage. Within the “Regulatory Spotlight” section, bankers can review summaries of rules and notices recently published by various federal agencies. See the “Compliance Notes” section for important compliance-related updates, including a FinCEN alert regarding a new virtual currency investment scam, a reminder of a new resource meant to help banks handle check fraud claims more efficiently, and another update to FDIC’s Equal Housing Lender Poster.