Stay up to date with recent regulatory activity and advisories for banks, credit unions, and other financial institutions.
The January Regulatory Compliance Briefing includes recent and upcoming alerts, announcements, and pending actions to be aware of this month.
CA-210 CFPB Final Rules updating Exemption Thresholds (Reg. C and Reg. Z)
CA-211 FRB, FDIC, and OCC Final Rules Updating Asset-Size Thresholds Under Community Reinvestment Act Regulations
CA-212 FinCEN Final Rule – Beneficial Ownership Information Access and Safeguards, and Use of FinCEN Identifiers for Entities
CA-213 FDIC Final Rule on FDIC Official Signs and Advertising Requirements, False Advertising, Misrepresentation of Insured Status, and Misuse of the FDICās Name or Logo
FinCEN Final Beneficial Ownership Access Rule
FDIC Final Rule on FDIC Official Signs and Advertising Requirements, False Advertising, Misrepresentation of Insured Status, and Misuse of the FDICās Name or Logo
The selected advisories and/or announcements below provide information that may be helpful to your organization but were not included as compliance alerts because they do not contain any regulatory changes.
On January 8, 2024, the CFPB announced the annual adjustments for inflation to the CFPBās civil penalty amounts. The CFPB adjusts the civil penalties under the laws within the CFPBās jurisdiction based on the cost-of living adjustments. For the 2024 annual adjustment, the multiplier reflecting the ācost-of-living adjustmentā is 1.03241. Therefore, the CFPBās civil penalties are increased by a multiplier of 1.03241 and rounded to the nearest dollar for 2024. The Final Rule provides a table reflecting the increased penalties for specified laws.
On January 17, 2024, the CFPB issued a Proposed Rule to amend Reg. E and Reg. Z related to overdraft programs by very large financial institutions (assets of $10 billion or more). Under the Proposed Rule, such financial institutions could offer courtesy overdraft services, but only charge either: a) the direct costs to provide the service, or b) a ābenchmark feeā of $3, $6, $7, or $14 (such amount to be determined in a Final Rule). If a very large financial institution wishes to charge a greater fee, the overdraft service would be deemed credit subject to TILA, and therefore require a credit agreement and TILA disclosures.
On January 24, 2024, the CFPB issued a Proposed Rule to prohibit financial institutions from charging fees, such as NSF fees, when a consumer initiates certain payment transactions that are instantaneously declined. The prohibition would cover transactions involving the use of debit cards, ATMs, or certain person-to-person apps. Charging such fees would constitute an abusive practice under the Consumer Financial Protection Actās prohibition on unfair, deceptive, or abusive acts or practices.
On December 1, 2023, the FDIC issued FIL-62-2023, announcing a series of steps intended to provide regulatory relief to financial institutions and facilitate recovery in areas of Illinois affected by severe storms and flooding.
On December 18, 2023, the FDIC issued FIL-64-2023 and Advisory: Managing Commercial Real Estate Concentrations in a Challenging Economic Environment. The Advisory is intended to reemphasize the importance of strong capital, appropriate credit loss allowance levels, and robust credit risk-management practices for institutions with commercial real estate (CRE) concentrations. The Advisory identifies key risk-management actions for financial institutions with significant CRE concentrations to manage through changes in market conditions. The advisory replaces the 2008 advisory: Managing Commercial Real Estate Concentrations in a Challenging Environment (issued March 17, 2008).
On December 21, 2023, the FDIC issued FIL-66-2023, announcing a series of steps intended to provide regulatory relief to financial institutions and facilitate recovery in areas of Tennessee affected by severe storms and tornadoes.
On January 18, 2024, the FDIC issued FIL-2-2024, announcing a series of steps intended to provide regulatory relief to financial institutions and facilitate recovery in areas of Rhode Island affected by severe storms, flooding, and tornadoes.
On November 28, 2023, the NCUA announced that it will reinstate assessing civil money penalties for credit unions failing to submit NCUA Form 5300 Call Report on time, effective January 1, 2024.
On January 1, 2024, the NCUA issued a Letter to Credit Unions outlining the NCUAās 2024 supervisory priorities and other updates to the agencyās 2024 examination program. Supervisory Priorities for 2024 include: Credit Risk, Liquidity Risk, Consumer Financial Protection (including overdraft programs, fair lending, and auto lending), Information Security (Cybersecurity), and Interest Rate Risk.
On December 6, 2023, the OCC issued guidance to national banks and federal savings associations to address the risks associated with ābuy now, pay laterā lending. The guidance focuses on the risk management of buy now, pay later loans, which are payable in four or fewer installments and carry no finance charges.
On December 20, 2023, the FTC issued a Proposed Rule to amend the Childrenās Online Privacy Protection Rule (COPPA Rule). The proposed changes would place new restrictions on the use and disclosure of childrenās personal information and further limit the ability of companies to condition access to services on monetizing childrenās data. Specifically, the proposed changes include: Requiring separate opt-in for targeted advertising; a prohibition against conditioning a childās participation on collection of personal information; limits on the support for the internal operations exception; limits on nudging kids to stay online; changes related to Ed Tech; increasing accountability for Safe Harbor programs; strengthening data security requirements; and limits on data retention.
On December 15, 2023, the FDIC, FRB, and OCC issued an Interagency Statement to extend the expiration of the certain no-action position previously provided in an Interagency Statement. The Interagency Statement provided that the federal banking agencies would not take action against banks or principal shareholder fund complexes with respect to extensions of credit by the banks to fund complex-controlled portfolio companies that otherwise would violate Regulation O, provided the fund complexes and banks satisfy the criteria set forth in the Interagency Statement. The new Interagency Statement extends the no-action position until the sooner of January 1, 2025, or the effective date of a final FRB rule having a revision to Regulation O that addresses the treatment of extensions of credit by a bank to fund complex-controlled portfolio companies that are insiders of the bank.
On December 21, 2023, the FDIC, FRB, NCUA, OCC, FinCEN, and state bank and credit union regulators issued an interagency statement regarding the beneficial ownership information Access Rule. The Interagency Statement explains that the Access Rule does not create a new regulatory requirement for banks to access BOI from the BO IT System or a supervisory expectation that they do so, and that the Access Rule does not necessitate changes to BSA/AML compliance programs.
For access to the complete analysis, executive summaries, and actions needed to ensure compliance, contact us.