July 2018 Compliance Journal: Compliance Notes

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

FRB, FDIC, and OCC announced the availability of the 2018 list of distressed or underserved nonmetropolitan middle-income geographies, where revitalization or stabilization activities are eligible to receive Community Reinvestment Act (CRA) consideration under the community development definition. The list may be viewed at: https://www.federalreserve.gov/newsevents/pressreleases/files/bcreg20180625a1.pdf


FRB issued a Consumer Affairs Letter regarding the restored Protecting Tenants at Foreclosure Act of 2009, which became effective on June 23, 2018. The law protects tenants from immediate eviction by persons or entities that become owners of residential property through the foreclosure process, and extends additional protections for tenants with U.S. Department of Housing and Urban Development Section 8 vouchers. The letter may be viewed at: https://www.federalreserve.gov/supervisionreg/caletters/caltr1804.htm

FDIC issued the Spring/Summer 2018 edition of Money Smart News. The new edition addresses the updated Money Smarts for Adults course scheduled for release in September, the March Money Smarts for Small Business Town Hall, and consumer tips on protecting assets. The full Money Smarts News may be viewed at: https://www.fdic.gov/consumers/consumer/moneysmart/newsletter/spring2018/index.html 

CFPB, OCC, and FDIC released statements regarding S. 2155 Economic Growth, Regulatory Relief, and Consumer Protection Act and the changes it makes to HMDA reporting requirements. The act provides a partial exception to institutions that originated fewer than 500 closed-end mortgage loans in each of the two preceding calendar years, and for open-end lines of credit if the institution originated fewer than 500 open-end lines of credit in each of the two preceding calendar years. CFPB’s statement may be viewed at: https://www.consumerfinance.gov/about-us/newsroom/bureau-consumer-financial-protection-issues-statement-implementation-economic-growth-regulatory-relief-and-consumer-protection-act-amendments-home-mortgage-disclosure-act/ 
OCC’s statement may be viewed at: https://www.occ.gov/news-issuances/bulletins/2018/bulletin-2018-19.html
FDIC’s statement may be viewed at: https://www.fdic.gov/news/news/financial/2018/fil18036.html 

NMLS issued its first quarter 2018 Mortgage Industry Report. The report compiles data concerning companies, branches and mortgage loan originators (MLOs) who are licensed or registered through NMLS in order to conduct mortgage activities. The report indicates that the number of active MLOs in the first quarter of 2018 decreased by 0.7 percent nationwide over the first quarter of 2017, among other findings. The report may be viewed at: https://mortgage.nationwidelicensingsystem.org/about/Reports/2018Q1-Mortgage-Report.pdf.

FRB has issued the semi-annual Money Policy Report to Congress which found that economic activity increased at a solid pace over the first half of 2018, and the labor market has continued to strengthen. Inflation has moved up, and in May, the most recent period for which data are available, inflation measured on a 12-month basis was a little above the Federal Open Market Committee’s (FOMC) longer-run objective of 2 percent. The report may be viewed at: https://www.federalreserve.gov/monetarypolicy/2018-07-mpr-summary.htm

FBI’s Internet Crime Complaint Center issued a PSA regarding Business Email Compromise, which is a sophisticated scam targeting both businesses and individuals performing wire transfer payments. The scam is frequently carried out when a subject compromises legitimate business e-mail accounts through social engineering or computer intrusion techniques to conduct unauthorized transfers of funds. These sorts of scams heavily target those conducting real estate transactions. The PSA may be viewed at: https://www.ic3.gov/media/2018/180712.aspx 

FRB issued the July 2018 Report to the Congress on the Profitability of Credit Card Operations of Depository Institutions. The data in the report indicates that the level of earnings in 2017 from credit cards is down in 2016. The full report may be viewed at: https://www.federalreserve.gov/publications/files/ccprofit2018.pdf

OCC issued an alert regarding a scam wherein consumers receive fictitious e-mail messages, allegedly initiated by OCC, regarding funds purportedly under the control of OCC. OCC does not participate in the transfer of funds for, or on behalf of, individuals, business enterprises, or governmental entities. The communication may include a fictitious “Letter of Authorization” with a signature name of “Anhar Tonny Coptalen, Comptroller General Of The Currency.” The perpetrators may request, among other data, bank account information, including bank statements, with the purported purpose of making a large dollar deposit into the potential victim’s account. Consumers who have provided bank account information should contact their financial institutions immediately to report the issue and discuss options to protect their account assets.  The full alert may be viewed at: https://www.occ.gov/news-issuances/alerts/2018/alert-2018-9.html

Deputy Attorney General Rod Rosenstein announced the establishment of a new Task Force on Market Integrity and Consumer Fraud. The Task Force, which is formed pursuant to Presidential Executive Order, will provide guidance for the investigation and prosecution of cases involving fraud on the government, the financial markets, and consumers, including cyber-fraud and other fraud targeting the elderly, service members and veterans, and other members of the public; procurement and grant fraud; securities and commodities fraud, as well as other corporate fraud, with particular attention to fraud affecting the general public; digital currency fraud; money laundering, including the recovery of proceeds; health care fraud; tax fraud; and other financial crimes. The full announcement may be viewed at: https://www.justice.gov/opa/pr/department-justice-bureau-consumer-financial-protection-us-securities-and-exchange-commission 

OCC has announced will host two workshops at the Magnolia Hotel St. Louis in St. Louis, Mo., August 21-22, for directors of national community banks and federal savings associations supervised by the OCC. August 21 will be a Risk Governance workshop and August 22 will be a Credit Risk workshop. Further information may be viewed at: https://www.occ.gov/news-issuances/news-releases/2018/nr-occ-2018-72.html

FHFA released its Foreclosure Prevention Report for the first quarter 2018 which showed that the Enterprises’ overall delinquency rate decreased in the first quarter of 2018. The percentage of loans that are 30-59 days delinquent dropped to 1.2 percent while the 60-plus-day delinquency rate decreased to 1.4 percent at the end of the quarter. The Enterprises’ serious delinquency rate also decreased to 1.1 percent at the end of the quarter. The full report may be viewed at: https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/FPR_1Q2018.pdf 

By, Ally Bates