NAFCU Compliance Blog

Disclosure of Consumer Complaint Narratives; 2015 Regulatory Compliance School Group Photo

Written by JiJi Bahhur, Director of Regulatory Compliance

It has been a full week since the conclusion of NAFCU’s 2015 Regulatory Compliance School.  For those of you who were in attendance, I want to thank you and also commend you for the hard work and effort you put into this very long, but rewarding week.  I also want to congratulate the many of you who earned your NAFCU Certified Compliance Officer (NCCO) designation on site or who will do so in the near future. 

If you were in attendance at School, you may recall that during the Consumer Financial Protection Bureau (CFPB) Update session, I spoke briefly on the CFPB’s Final Policy Statement regarding disclosure of consumer complaint narrative data.  For those of you that did not attend, I’ll brief you now. 

Before I jump into the details of this final policy statement, I’d like to start by saying that regulators’ expectations for handling consumer complaints have been increasing, and that trend shows no sign of slowing down.  Even though the CFPB only has supervisory authority over credit unions with assets over $10 billion, and therefore the ability to make public only those complaints made on select credit unions, the NCUA could adopt a similar practice down the road. Also, many CFPB enforcement actions and potential rulemakings are generated from consumer complaints.

Under the current practice, when a consumer submits a complaint to the CFPB, neither the consumer’s nor the company’s complaint narrative are made public.  Under the final policy statement, disclosure of the consumer’s unstructured complaint narrative data is allowed if the consumer opts-in to having it disclosed publicly.  Prior to publishing the narrative, the CFPB will take reasonable steps, according to the final policy statement, to scrub the narrative of information that would make the consumer identifiable.   

While investigation and resolution of consumer complaints is ideal, it seems that potential effects from this final policy statement can cause more harm than good.  For instance, disclosing narrative data raises safety and soundness concerns and unduly places financial institutions’ reputation at risk.  Also, disclosing narrative fields increases the likelihood that personal information will be inadvertently released.  Even with the CFPB employing methods to scrub the fields of personally identifiable information, these processes can be imperfect. 

For more information on the final policy statement, see NAFCU’s final summary here (NAFCU log-in required).  The final rule is effective no earlier than June 24, 2015.  In other words, the CFPB will not make public any narratives on the Consumer Complaint Database until at least June 24, 2015.

2015 Regulatory Compliance School Group Photo

Five “Great Points” from NAFCU’s 2014 Regulatory Compliance School; Congrats, Class of 2014; Shameless Plug

Written by JiJi Bahhur, Director of Regulatory Compliance

From March 10-March 15, 2014, NAFCU held its annual Regulatory Compliance School in National Harbor, Maryland.  In attendance were numerous credit union industry professionals, including compliance officers, CEOs, marketing managers, attorneys, auditors, examiners, vendors and more!

Throughout the week, we had great questions both during and after the sessions.  And in some instances, we caught ourselves having an “uh-huh” moment because the presenter or attendee shared a great point that either clarified something we weren’t so sure about in the past or that put something on our radar.

Today, I’d like to share some of those moments with you:

Great Point #1:  Can the credit union send remittance transfer disclosures – both the prepayment disclosure and the receipt (or combined disclosure) – electronically?  Yes.  If the member requests the remittance transfer electronically, the prepayment disclosure can be sent electronically even where the Electronic Signatures in Global and National Commerce Act (E-SIGN Act) requirements are not met.  However, the receipt (or combined disclosure) may be sent electronically only if the E-SIGN Act requirements are met.

Great Point #2:  A number of our presenters discussed the importance of definitions.  In fact, we heard it a number of times:  “Read the definitions section of the regulation!”  Why?  The definition may be different than what you’re expecting depending on what regulation you’re dealing with.  Unfortunately, definitions are not consistent from regulation to regulation.

Great Point #3:  For open-end (not home-secured) credit, the credit union must provide 45-day advanced notice for changes to any terms required to be disclosed in the account opening disclosures.  On the model form provided by Regulation Z, there is language that states “for more information, see the enclosed booklet.”  If your credit union doesn’t have an enclosed booklet, it’s probably a good idea to remove that language!

Great Point #4:  Under Regulation E, can the credit union require the member to obtain a police report when the member reports a fraudulent transaction(s)?  No.  The credit union can request a police report, but it cannot require a police report.  Also, in a situation where the member provides oral notice of fraud, the credit union can require a member to follow up an oral notice with written notice (CU must inform member of this requirement and provide an address), but the credit union cannot delay its investigation. 

Great Point #5:  With advances in technology, it has become less clear as to where the NCUA advertising logo or official advertising statements are required.  Is it required on ATMs?  How about mobile banking?  Video teller machines?  NCUA has stated that ATMs are exempt from the NCUA logo requirement.  However, it is less clear as to whether the logo or official advertising statement are required for purposes of mobile banking and video teller machines.  It may be time for NCUA to take a look at its advertising rule to address these technological advances. 

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Congratulations to the Class of 2014 - it was truly a pleasure to spend the week dissecting both the existing and future regulations of the credit union industry with so many of you.  Even better, a number of attendees walked away with their NAFCU Certified Compliance Officer (NCCO) designation.  Again, congratulations!  What an accomplishment!  And, here is the Class of 2014 . . .

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Shameless Plug.  NAFCU’s 2014 Credit Union Compliance GPS is available for purchase! This comprehensive, electronic resource translates complex regulatory language into plain English. The latest edition includes an expanded section on Reg E and the Remittance Transfer Rule, 7 new sections on the CFPB’s mortgage rules, improved user-friendly search functions, including more hyperlinks and bookmarks and much more. Get yours today!

NAFCU’s 2013 Regulatory Compliance Seminar – Watch it LIVE!

Written by Michael Coleman, Regulatory Compliance Counsel

It’s that time of year again, summer is over and we’re moving into the fall, the Redskins are floundering, and NAFCU’s 2013 Regulatory Compliance Seminar is right around the corner.

The current regulatory environment has placed an immense burden on the credit union industry (I’ve been trying to kick-start the term “Reg-pocalypse” with limited success) and the need to stay informed and up to date on compliance issues is greater than ever. I don’t know about you, but I try to avail myself of every opportunity to learn something, read something, watch something, or participate in something that will help me understand current compliance issues faced by credit unions. Which brings me to my shameless plug.

This year’s Regulatory Compliance Seminar has sold out. If you were unable to register and won’t be able to join us in Nashville, Tennessee, fear not! To accommodate the growing demand for the important information and education provided at Regulatory Compliance Seminar, we're launching a Live Video Streaming option as a pilot program which will allow you (and anyone from your credit union) to attend virtually.

How will Live Video Streaming of Regulatory Compliance Seminar work?

• Register for the 2013 Regulatory Compliance Seminar Live Video Streaming.
• Receive an email confirming your registration and providing login information to access the live video stream during the seminar.
• Test your systems to access live streaming before the start of the seminar.
• Visit the Live Video Streaming link each day during the time of the courses (note: all times are in Central Time), using your login information to view the live stream. A link to course handouts is available after login.
• The sessions/courses will be available on-demand starting October 31, revisit the material with your same login information. (Link to on-demand course recordings to be provided after the live event).
• Anyone attending the seminar in-person in Nashville will get access to the on-demand recordings of the courses after the seminar.
• NCCOs earn the same 24 CEUs for watching all of the live streaming courses as they do for attending all courses in-person.

How much does the Live Streaming Cost? The registration fees for the streaming option are:

• NAFCU Member: $1,575
• Nonmember NCCO: $2,075 – Note: Nonmember NCCOs must call NAFCU’s Member Service Center at 800-344-5580 to register and get the discounted pricing.
• Nonmember:$2,575

Don’t miss this great opportunity to participate in NAFCU’s 2013 Regulatory Compliance Seminar, visit our website for more details and sign up today!

Have a great weekend!

Metsger; Latest on Interchange Fees; Compliance Seminar versus Compliance School

Written by Steve Van Beek

NCUA Board. Rick Metsger will be sworn into office as an NCUA Board member on August 23 in a private ceremony on Capitol Hill. NCUA General Counsel Michael McKenna will deliver the oath of office to Metsger, paving the way for Metsger’s participation in NCUA's September 12 Board meeting (there will not be an August meeting).

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Interchange Fees (Durbin Amendment). As we mentioned on August 1st, the Federal Reserve's interchange regulation was overturned by a Federal District Court leaving the interchange fee caps and the network exclusivity provisions in limbo. On Wednesday, Judge Richard Leon held a hearing which focused on whether Federal Reserve should write an Interim Final Rule.

For additional information on the next steps, check out Carrie Hunt's video recap:

For background information on the Interchange Fee issue, check out NAFCU's Issue Brief (and consider attending NAFCU's Congressional Caucus next month). 

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Seminar versus School. We're often asked which of NAFCU's compliance conferences is right for a particular individual. Below are a few guidelines that should help. Of course, if you have any questions - please shoot me an email and I'll be happy to help. 

Regulatory Compliance Seminar

• Four days each October at different locations throughout the country. Next: October 22-25, 2013 in Nashville, Tennessee. Sneak Peek: October 14-17, 2014 in Baltimore, Maryland (registration coming soon!)

• Sessions include in-depth discussion of the hottest compliance issues facing credit unions - including detailed analysis of new and future regulations. For example, this year's conference will have multiple sessions reviewing the new mortgage regulations.

• Perfect conference for existing NAFCU Certified Compliance Officers (NCCOs) to obtain recertification (no exams!)

• Reconnect with your network of compliance professionals from around the country

Regulatory Compliance School

• Five days each March in the Washington D.C. area. Next: March 10-15, 2014 in National Harbor, Maryland. Registration is open; details coming soon (check out 2013 School for a good outline).

• Perfect conference for individuals interested in obtaining their NAFCU Certified Compliance Officer (NCCO) designation. Attendees have the option of taking the NCCO exams on-site (exams are the morning following each day of content).

• Sessions provide a comprehensive foundation of the compliance environment facing credit unions. We walk through the nuts and bolts of various regulations - such as Regulation D, Regulation E and Regulation Z - and review topics such as Share Insurance, the E-SIGN Act and Privacy of Member Information. Bring your pencils (and your sharpener(s))!

• Ideal for new compliance officers, those taking on more and more compliance responsibilities as well as those who are looking for a comprehensive "refresher" (School also provides 24 credits for existing NCCOs to complete their recertification).

We hope to see you Seminar or School in the upcoming year! For 2013 Seminar in Nashville - be sure to register by Friday, August 23 to lock-in early-bird savings!

Upcoming Webinars & Webcasts; NAFCU's Regulatory Compliance Seminar - Nashville

Written by Steve Van Beek

Today, I wanted to highlight a few upcoming webinars and webcasts:

• Today - NCUA Town Hall Webinar- 3 p.m. Register here.

• Wednesday, July 24 - NAFCU Webcast - Advertising Risks and Compliance

• Monday, July 29 - Free NAFCU Webcast - Defense Credit Union Update featuring Holly Petraeus (CFPB) - free to all credit unions regardless of NAFCU membership

• Wednesday, July 31 - NAFCU Webcast - Annual BSA Compliance Update for Boards & Supervisory Committees (as with all NAFCU webcasts, this webcast will also be available on-demand allowing you to view at your CU's next board meeting or training session).

• Tuesday, August 6 - Consumer Compliance Outlook Webinar - Indirect Auto Lending - Fair Lending Considerations

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NAFCU's Regulatory Compliance Seminar. If you are looking for comprehensive compliance training - and the best way to recertify your NCCO - be sure to check out NAFCU's upcoming Seminar in Nashville, Tennessee (October 22-25).  

We have a great agenda, including:

• What Does a Culture of Compliance Mean for Your Credit Union?

• Vendor Management from a Vendor's Perspective

• Vendor Management from an Attorney's Perspective

• Regulation E - Error Resolution Procedures

• Due Diligence for Mergers

• Fair Lending

• The Legal Aspects of Social Media

And, there are many more great sessions that will be presented by an outstanding group of experienced credit union professionals.

Hope to see you in Nashville - October 22-25!  Early-bird pricing ends August 23rd - so register soon to save!

OCC Speech on Risk Culture

Written by Steve Van Beek

As I catch up on my summer reading......I've found some absolute gems - including this speech by Carolyn DuChene, the Deputy Comptroller for Operation Risk at the OCC. The speech talks about risk management and, especially, the importance of a risk culture at financial institutions:

"Every organization has a unique risk culture. You might think of it as the organization's 'DNA.' The risk culture consists of core values that drive business practices and that shape executive decision-making as well as employee actions...Risk culture is the navigational beacon by which the board, the officers, and the employees make sound decisions that are aligned with long-term strategy. It is the guiding light that helps each person take prudent actions knowing that he or she owns and is responsible for the results. When that beacon isn't working, an organization can lose direction and may chart the wrong course, entering markets and introducing new products without appropriate due diligence, or aggressively pursuing earnings and growth at 'any cost.' The navigational beacon can also guide appopriate risk taking and actively discourage inappropriate risk taking."

DuChene's speech goes on to discuss five elements of an institution's risk culture:

• Enterprise
• Ethics
• Education/Expertise
• Empowered and Engaged Employees
• Executive Expectations

The closing of the speech includes this:

"The establishment and cultivation of a risk culture is, in the end, all about good stewardship, and the recognition that a firm and its reputation prosper across the economic cycles when the human element is in sync with the risk management environment...Risk culture is an issue that is independent of size. In community banks, it can be the single most important element that guides them through economic cycles. Along with sound risk management and solid well-developed business strategies and capital plans, a healthy risk culture contributes to success. I believe banks that continually improve on these elements have a competitive advantage."

Of course, the speech was directed to a banking crowd - but the overall message applies to credit unions as well and I'd encourage you to read the full speech. 

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If you are interested in learning more - I'd encourage you to read my Three-Dimensional Compliance article from the May/June The Federal Credit Union and consider attending NAFCU's Regulatory Compliance Seminar where David Reed and Rusty Vellek will be discussing similar themes in their Featured Presentation: What Does Having a Culture of Compliance Mean for Your Credit Union?

NCCOs - Seminar is the perfect place to recertify your NCCO as you'll earn the full 24 credits. 

Which Regulatory Changes Are Coming Next?; Seminar in Nashville

Written by Steve Van Beek

Pew Charitable Trusts Report. If you haven't seen the recent Pew Report - Checks and Balances: Measuring checking accounts' safety and transparency - be sure to take a look. Pew has numerous recommendations to the CFPB, including:

Disclosure Policies

• Require depository institutions to provide information about checking account terms, conditions, and fees in a uniform, concise, easy-to-read format that would be available online and in financial institutions' branches.
• Require depository institutions to provide accountholders with clear, comprehensive terms and pricing information for all available overdraft options when a customer is considering opting in to a plan.

Overdraft Policies

• Require that overdraft penalty fees be reasonable and proportional to the institution's costs in providing the overdraft loan or to the size of the violation.
• Require depository institutions to post deposits and withdrawals in a fully disclosed, objective and neutral manner, such as in chronological order, that does not maximize overdraft fees. 

While these are recommendations at this point, there is a definite possibility the CFPB moves on amending checking account disclosures in the next year. At a minimum, be sure to pass this report along to others at your credit union - paying special attention to the suggested Model Disclosure Box on page 9 of the PDF (page 7 of the report). Would your forms provider be able to recreate that disclosure? How long would it take? At what cost? 

While Pew's Report looks at 36 of the 50 largest banks, the recommended changes are meant for all depository institutions - including credit unions. 

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Nashville, Tennessee. NAFCU's 2013 Regulatory Compliance Seminar will be held October 22-25 in Nashville, Tennessee. Details are now available, including:

• Program-at-a-Glance

• Featured Presentation - What Does Having a Culture of Compliance Mean to Your Credit Union?

We hear again and again about the importance of fostering a culture of compliance. What exactly does that mean? Why should you invest the time and effort into creating such a culture? Join experts David A. Reed and Rusty Vellek to learn how to know if you have achieved a culture of compliance at your credit union. Also explore how to gain buy-in from all departments to support the notion of a culture of compliance.

• Detailed Session Descriptions

• Experienced Speakers

We hope to see you there! Be sure to sign-up by August 23 to Save $100!

Five Takeaways from Regulatory Compliance School; Earn your NCCO!

Written by Steve Van Beek

Last week was NAFCU's 2013 Regulatory Compliance School, and we had an outstanding class. Great questions, great speakers and great networking opportunities.  

Here are five takeaways from School:

• The role of compliance is changing and credit unions need to make sure their compliance function is three-dimensional

• Credit unions need to establish a mortgage rule implementation team to manage the numerous changes

• The actions of the CFPB and NCUA's Office of Consumer Protection have the potential to increase reputation risk at credit unions

• Compliance officers need a seat at the table during product development and rollout

• No one can do it alone - compliance officers should reach out to colleagues (both internal and at other credit unions) to ensure their CU is keeping up with all the new requirements

Congratulations to the Class of 2013 - it was truly a pleasure to spend the week examining the existing (and future) regulatory environment facing credit unions.  

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Compliance Seminar. If you missed Compliance School, consider joining us in October for our Regulatory Compliance Seminar in Nashville where we'll be reviewing the latest compliance issues facing credit unions. We're building the agenda now, so if you have any suggestions of "must cover" topics - just shoot us an email.

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Earn Your NAFCU Certified Compliance Officer (NCCO) designation. Compliance School offers the ability for attendees to sit for four examinations and earn the NCCO designation. We also offer a self-study approach that allows anyone seeking a thorough understanding of the laws and regulations impacting credit union operations. 

The NCCO exams track NAFCU's Credit Union Compliance GPS (the 2013 version) and interested persons can purchase all four exams and have them proctored by a colleague at the credit union. If you are interested in earning your NCCO exam, take a look at the following resources:

• What is on the NCCO exams?

• NAFCU's 2013 Credit Union Compliance GPS*

• 2013 NCCO Exam Study Guide (opens as a PDF)

• NCCO Program Frequently-Asked-Questions

The FAQs include this one making it clear the NCCO designation is open to everyone:

Does my credit union or organization need to be a member of NAFCU for me to pursue the NCCO designation? 

No, the NCCO program is open to everyone. Any credit union professional who desires to improve their overall comprehension and skills in the compliance arena may pursue the NCCO designation.  Currently, there are CEOs, compliance officers, internal auditors, attorneys, lending officers, risk managers, vendors and numerous other individuals who have successfully passed the exams to become NCCOs.    

*The GPS is not required to take the NCCO exams. However, it is strongly recommended as it serves as the primary text for the NCCO exams. In other words, the information needed to answer each exam question is covered in the GPS text. Additionally, keep in mind that the GPS is one per credit union (or organization). If your credit union sent one person to our 2013 Compliance School (or you've purchased the 2013 GPS), you would not need to purchase another copy.  

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Or, budget to join us for our 2014 Regulatory Compliance School where you'll receive in-person training and the opportunity to sit for the NCCO exams!  

Help is Here: NAFCU’s 2013 Credit Union Compliance GPS

Written By JiJi Bahhur, Regulatory Compliance Counsel

We talk to credit unions every day. And, we hear the same concerns, fears and frustrations:

• How do we keep up?
• How do we know if this is the latest information?
• Where can I find that guidance document?
• When will someone explain this information in plain English?
• How do we get everyone on the same page without busting our limited training budget?

It is with these conversations in mind that we created the GPS and are pleased to announce the 2013 edition (with a very shameless plug).

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NAFCU's Credit Union Compliance GPS - 2013 Edition. Hot off the electronic presses is the 2013 edition of NAFCU’s Credit Union Compliance GPS.  Written by NAFCU's compliance team, this electronic manual spans almost 500 pages and covers everything from the basic anatomy of a federal credit union to specific regulations from the NCUA, CFPB, and more.  It is the ideal companion for all credit union compliance officers and staff, consultants, vendors and attorneys.  The GPS translates complex regulatory language into plain English to help credit unions on a day-to-day basis while at that same time providing links to the applicable regulations, laws, and guidance documents.

And here’s the great part – you don’t have to be a NAFCU member to purchase the GPS.  The GPS is available to anyone and everyone at one affordable price ― $399 for NAFCU members and $499 for nonmembers. One purchase allows you to share the electronic manual with your entire credit union or business. And for no additional cost, your purchase of the 2013 GPS includes access to NAFCU’s new Scope & Applicability Charts to help you make sense of the CFPB’s new mortgage rules.

If your credit union has a prior version of the GPS (via purchase or attending a prior Regulatory Compliance School), you'd need to purchase the new 2013 GPS in order to receive the latest information. We've put a ton of time and effort into thoroughly reviewing the 2013 GPS to reflect regulatory changes. Additionally, we provided some additional bells and whistles to the 2013 GPS based on credit union feedback:

• an expanded section on the CFPB;
• user-friendly bookmarks, hyperlinks and pagination for easy navigation; and
• enhanced study tips for those studying for the NAFCU Certified Compliance Officer (NCCO) exams.

For a closer look, click here and check out our “sneak peek” documents available in the tabs to the right-hand side of the webpage (e.g., main table of contents, one page table of contents, section by section listing). 

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NAFCU Certified Compliance Officer (NCCO) Program. NAFCU’s Credit Union Compliance GPS serves as the learning manual for NAFCU’s annual Regulatory Compliance School held each March.  NAFCU also offers a self-study program which allows anyone interested in obtaining a solid foundation of the compliance issues facing credit unions to take the four exams required to earn the NCCO designation.

If you are interested in the GPS, take a look at our new NCCO Exam Study Guide (opens as a PDF) and consider taking the next step and obtaining your NCCO.  

Bozo's Grand Prize Game & Share Insurance; NAFCU's March Compliance Monitor

Written by Steve Van Beek

NAFCU's Compliance School is only a couple of weeks away and we are busy putting together the final details - including our presentations.  One of the sessions is on NCUA's Share Insurance and I wanted to share my favorite slide:

To me, Bozo's Grand Prize Game contains lessons for understanding share insurance coverage.  An account can only fit in one "bucket" at a time.  Understanding this helps explain share insurance coverage and how members can structure their accounts to maximize share insurance.  

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NAFCU's March Compliance Monitor.  The March issue of NAFCU's Compliance Monitor is now available for NAFCU members.  The March issue highlights NAFCU's Scope & Applicability Charts and includes two main articles:

• Understanding the Small Servicer Exemptions

• NCUA's Final Credit Ratings Rule Impacts Credit Union Investments

There are also numerous Q&As on the CFPB's new mortgage requirements - including ones submitted during our webcast on the CFPB's Final Mortgage Regulations (available for on-demand purchase).

NAFCU Members:  If you click on the article links above you'll notice a new feature - we are publishing our articles in HTML format (in addition to the PDF).  This means the articles are fully-searchable on NAFCU's website.  And, we have more enhancements in the works as well - so stay tuned!

Have a great weekend!

NAFCU's Regulatory Compliance School Just Got Better - Regulatory Update Day

Written by Steve Van Beek

We've heard you!  For the past couple of years, we've received the following feedback about NAFCU's Regulatory Compliance School (paraphrased, of course):

"School is great and provided a solid foundation for understanding the regulatory requirements credit unions face on a daily basis.  BUT, the rules are changing so fast that it would be great to receive updates on what has just changed and what is changing next."

With this in mind, we've created Regulatory Update Day at NAFCU's 2013 Regulatory Compliance School (March 18-23 in National Harbor, Maryland).  

Regulatory Update Day (Thursday, March 21st) will provide:

• A clear understanding of what changes NCUA has in store for 2013 – including their Exam Focus

• An overview of the scope and applicability of the CFPB’s seven new mortgage regulations*

• A detailed look at the CFPB’s Qualified Mortgage/Ability-to-Repay requirements*

• Answers to Frequently Asked Questions on the mortgage rules from NAFCU’s compliance team*

• Insight from credit union attorneys and practitioners on how best to set up your implementation strategy

You can find more information on Regulatory Update Day here.  The three sessions with the "*" are sessions that are also part of NAFCU's Mortgage Reform Webcast Series.

The other 4 days of Compliance School will remain the same as will the opportunity to take the NAFCU Certified Compliance Officer (NCCO) exams.  Good luck!  

***

And, all attendees at NAFCU's 2013 Regulatory Compliance School will receive NAFCU's 2013 GPS (coming soon!) as well as NAFCU's Scope & Applicability Charts.

Remember:  You do not need to be a NAFCU member credit union to attend NAFCU's conferences or webcasts.  In fact, you don't even need to work at a credit union.  Each School usually features a handful of consultants, vendors and other credit union "peeps" who support credit unions - in one way or another - on a daily basis.      

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Mortgage Headache Areas; Upcoming Mortgage Reform Webcasts

Written by Steve Van Beek

Yesterday was NAFCU's first webcast as part of our Mortgage Reform Webcast Series.  I provided an overview of the seven new mortgage regulations - focusing specifically on the scope & applicability of the new requirements.  

I also provided some insight on "Headache Areas" and included this list at the end of the presentation:

• Determining Exemption Applicability

• New Notices – Content-Rich and Strict Timelines

• Error Resolution & Information Request Procedures

• Loan Originator Compensation Determinations

• Implementing So Many Changes At One Time

And, there will be many additional headaches as credit unions work toward implementing the new requirements.  Even self-induced ones.  

There is some hope on the horizon as the CFPB issued their best press release of their history which highlights their Implementation Plan for New Mortgage Rules.  The CFPB's plan indicates they are listening to NAFCU and credit union concerns regarding the overwhelming burden of reading, understanding, interpreting and implementing numerous requirements simultaneously.  Of course, we'll have more information on the CFPB's plan in future blog posts.

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Upcoming Mortgage Reform Webcasts.  As I mentioned, yesterday's webcast was the first of our series and registration for the next three is now open.

• CFPB's Ability to Repay and Qualified Mortgage Requirements - March 6, 2013 - 2:00 p.m. to 3:30 p.m.

On March 6, Andy Keeney from Kaufman & Canoles will be examining the details of the CFPB's Ability-to-Repay Requirements and Qualified Mortgage Standards.  Andy will walk through the new underwriting guidelines - including the debt-to-income requirements - and explain how these rules will impact credit union mortgage lending.  And, importantly, the steps your credit union needs to take to comply by January 10, 2014.  

• Digging Deeper: CFPB's Mortgage Rules - March 27, 2013 - 2:00 p.m. to 3:30 p.m.

I'll be joined by my colleagues JiJi Bahhur, Bernadette Clair and Mike Coleman as we explore details of the CFPB's new mortgage requirements.  We'll provide answers to Frequently-Asked-Questions that our team has fielded from NAFCU member credit unions.  And, we'll take a look ahead at what other areas the CFPB is likely to address in 2013.  

• Which New Requirements Apply to HELOCs? - April 10, 2013 - 2:00 p.m. to 3:30 p.m.

I'll provide a detailed look at which requirements apply to home equity lines of credit and - just as importantly - which do not apply so that your credit union can best position your implementation strategy.  If your credit union makes HELOCs, this is one you'll want to attend as the new requirements are sprinkled throughout the CFPB's 3507 pages!

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Programming Note:  NAFCU's offices will be closing early tomorrow and will be closed on Monday for the Federal holiday.  We'll have a blog post tomorrow and then start back up again on Tuesday.   

NAFCU's Scope & Applicability Charts for the New Mortgage Rules; NAFCU Calls for CU Reg Relief

Written by Steve Van Beek

The CFPB's 3507 pages of new mortgage regulations has everyone wondering where to start and how to best handle the new requirements.  One of the best first steps is to determine which requirements apply to which types of mortgage loans.  To help with this, NAFCU has put together the following Scope & Applicability Charts:

• Regulation Z (TILA) Mortgage Servicing Requirements

• Regulation X (RESPA) Mortgage Servicing Requirements

• Loan Originator Compensation, Qualifications, Training and Disclosure Requirements

• Regulation B Appraisal Requirements

• Appraisal Disclosure Requirement for Higher-Priced Mortgage Loans

• Appraisal Requirements for Higher-Priced Mortgage Loans

• New Escrow Requirements for Higher-Priced Mortgage Loans

• New Requirements for High-Cost Mortgage Loans

• New Homeownership Counseling Disclosure Requirement

• Ability-to-Repay Requirements and Qualified Mortgage Standards 

Now, you might be wondering how you gain access to those charts.  There are Five Ways:

• NAFCU members have access directly via NAFCU's CFPB Mortgage Rules webpage.

• Registrants for today's webcast on The CFPB's Final Mortgage Regulations (registration is still open) will be able to download the charts during the webcast.

• Attendees at NAFCU's Regulatory Compliance School will hear a similar presentation to today's webcast and will receive access to the charts at School in March (of course, NAFCU members can access the charts here).

• Purchasers of NAFCU's Credit Union Compliance GPS will receive access in mid-March when the 2013 GPS is available.

• Non-NAFCU member registrants of NAFCU's Regulatory Compliance Seminar will receive access in the next week.  If you sign-up for Seminar after today, we'll get the charts to you within a week of your registration.   

A Note on Sharing of Charts.  We put a ton of time and effort into researching and creating these charts.  And, we've made the accessible - in one way or another - to any credit union or organization that is interested.  Please do not share these outside of your credit union.  Of course, if you have any questions - just shoot me an email.  

Hope to see you on today's Mortgage Rules Webcast.

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NAFCU Calls for Regulatory Relief.  Yesterday morning, NAFCU sent a letter to Senate and House leaders calling for a five-point plan on providing regulatory relief for credit unions through administrative, capital, structural, operational and data security reforms.  You can find the letter here.  For additional details, check out the NAFCU Today.

CFPB Mortgage Rules in Federal Register; NAFCU Rule Summaries; Upcoming NAFCU Mortgage Webcasts

Written by Steve Van Beek

CFPB's Mortgage Regulations.  The CFPB's mortgage regulations are starting to be published in the Federal Register.  Below are the links to the rules that have been published so far as well as links to rules that are at the Public Inspection Desk (waiting to be published).

Published in Federal Register

• Escrow Requirements for Higher-Priced Mortgage Loans - Regulation Z

• Disclosure and Delivery Requirements for Copies of Appraisals and Other Valuations - Regulation B

• HOEPA/High-Cost Mortgages and Homeownership Counseling Amendments - Regulation Z & Regulation X

• Ability-to-Repay and Qualified Mortgage Standards - Regulation Z

• Concurrent Proposal - Ability-to-Repay and Qualified Mortgage Standards - Regulation Z

• Mortgage Servicing Rules (02/14) - Regulation Z (TILA)

• Mortgage Servicing Rules (02/14)- Regulation X (RESPA)

• Loan Originator Compensation Requirements (02/15) - Regulation Z

• Interagency Final Rule on Appraisals for Higher-Priced Mortgages.

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NAFCU Resources.  Yesterday, we mentioned our new mortgage rules webpage.  That page includes tons of resources to help credit unions comply and it will be growing each day.  Included are summaries of the new rules from NAFCU's Regulatory Affairs team, such as:

• Final Regulation:  Ability-to-Repay and Qualified Mortgages
• Regulatory Alert:  Concurrent Proposal for Ability-to-Repay and Qualified Mortgages
• Final Regulation:  Escrow Requirements for Higher-Priced Mortgages
• Compliance Monitor Article:  Escrow Requirements for Higher-Priced Mortgages
• Final Regulation:  HOEPA/High-Cost Mortgage Loans and Homeownership Counseling Amendments
• Final Regulation:  Mortgage Servicing Requirements (Both Reg Z and Reg X)

Note:  The resources linked above are for NAFCU members-only.  However, the new mortgage rules webpage has additional resources that are available to everyone - including webcasts, conference sessions and links to blog post categories.   

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Upcoming NAFCU Mortgage Webcasts.  The first two webcasts of NAFCU's Mortgage Reform Webcast Series are quickly approaching:

• The CFPB's Final Mortgage Regulations - February 13, 2013 - Special Two-Hour Webcast - 2:00 p.m. to 4:00 p.m.

I'll be providing an overview of the new regulations - including specifically the scope and applicability of each regulation.  I'll also be zeroing-in on the finalized exemptions and how credit unions determine if they qualify for the exemptions.  For a taste of the resources I'll be providing, check out this Scope & Applicability Chart for the Escrow Final Rule. 

• CFPB's Ability to Repay and Qualified Mortgage Requirements - March 6, 2013 - 2:00 p.m. to 3:30 p.m.

On March 6, Andy Keeney from Kaufman & Canoles will be examining the details of the CFPB's Ability-to-Repay and Qualified Mortgage Requirements.  Andy will walk through the new underwriting guidelines - including the debt-to-income requirements - and explain how these rules will impact credit union mortgage lending.  And, importantly, the steps your credit union needs to take to comply by January 10, 2014.  

                     

Potential Credit Card Surcharges; Legal Hurdles in 2013; NAFCU Member Call-In; Save $100 on NAFCU Conferences; NCCO Exam Info

Written by Steve Van Beek

I'm sure everyone has plenty of reading to do with the mortgage regulations (I sure do!), so here are a few small items that should be on your radar.

Potential Credit Card Surcharges.  As part of a recent settlement, merchants gained the ability to surcharge for credit card purchases on January 27, 2013.  While this won’t directly impact your credit union, it has the potential to impact your members.  It is unknown how prevalent merchant credit card surcharging will be, but it might be a good idea to put an article in your credit union newsletter or some information on your website.  For more information, visit VISA’s website – which includes a list of state laws that still prohibit surcharges.  

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Legal Hurdles in 2013.  The Credit Union Times ran a great article from Andy Keeney of Kaufman & Canoles on Legal Hurdles Facing Credit Unions in 2013.  Be sure to take a look and pass along to your colleagues.

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NAFCU Members:  Don’t miss NAFCU’s first Member Call-In of 2013 – February 12 at 3:30 p.m. EST.  NAFCU’s President and CEO Fred Becker and NAFCU’s Government Affairs team will provide updates on the legislative, regulatory and compliance landscapes.  The call is free, but you must register.  New to 2013: You can submit questions in advance using the form here.  Of course, if you have a specific compliance question you can always email NAFCU’s Compliance team directly.   

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Extra Savings for School & Seminar end on Thursday.  NAFCU is offering $100 off any conference through Thursday, January 31st.  This includes NAFCU's Regulatory Compliance School (March 18-23 at National Harbor, MD) and NAFCU's Regulatory Compliance Seminar (October 22-25 in Nashville, TN).  

Use the promo code NEWYEAR when your register to get the $100 off. 

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School & NCCO Exams.  For those of you registered for School (or considering it), we've put together some FAQs on the process for taking the NAFCU Certified Compliance Officer (NCCO) exams.  We'll also have a NCCO Exam orientation on Sunday, March 17th (optional) as well as quick NCCO Study Sessions at the end of each day to help you keen in on which issues to study for the Exams.  

Economic Census Forms; Upcoming Webinars & Webcasts

Written by Steve Van Beek

Economic Census.  Your credit union may have gotten an Economic Census form (the forms were sent between October and December).  The deadline for completion is February 12th.  To help facilitate understanding of this form and the requirement, the Office of Business Liaison at the Department of Commerce has put together information, numerous FAQs and is hosting a webinar on Wednesday, January 24th at 1:00 p.m. EST.  Note: There was a prior webinar on October 11th, 2012.  The slides from that presentation are here (very large PPT file) and a transcript is available here.

There are additional help resources available here.  

The FAQs include specific information for different industries - including credit unions.  The credit union FAQs are here and forms are here.  Remember, the deadline is February 12th, 2013.  

Note:  Not every credit union will receive a form.  But, be sure to check with folks and see if your CU has and make sure it is completed by February 12th. 

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There are also numerous other webinars and webcasts this week.  

NCUA Webinar on Serving Low-Income Members.  NCUA is hosting a free webinar on Strategic Issues for Servicing Low-Income Members.  This webinar is Wednesday, January 23rd at 2 p.m. EST.  If your credit union recently received your low-income designation, this might be a useful webinar.  Here is from the announcement:

"Staff from [NCUA's] OSCUI and NCUA’s Office of Consumer Protection will discuss ways low-income designated credit unions may improve and increase service to low-income members. In addition, the staff will present sample products and services designed to meet the needs of these members."

You can register here. 

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NCUA HMDA Webinar.  NCUA will also be offering a free webinar entitled HMDA: Accuracy and Timeliness.

The webinar will be Thursday, January 24th at 2 p.m. EST.  You can register for the webinar here and you can also send any questions to [email protected].  

NCUA also recently issued Regulatory Alert 13-2 which highlights the March 1, 2013 deadline for submitting HMDA data.  Earlier, they had sent Regulatory Alert 13-1 which discusses the $42 million asset threshold for 2013 HMDA reporting.

Does anyone know how these Regulatory Alerts are delivered?  Why don't they go through NCUA Express?  Another one they buried on their website was Regulatory Alert 12-4 on the CFPB's Remittance Rule. 

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Upcoming NAFCU Webcasts.  NAFCU will be offering a very full slate of webcasts in 2013.  And, you can be assured that quite a few will be focusing on compliance - especially the new mortgage requirements.  Below are our next couple webcasts:

• The CFPB's International Remittance Transfer Disclosure Rules - Thursday, January 24th from 2:00 - 3:30 p.m. EST.  Mary Lou Heighes will walk attendees through the final rule as well as aspects of the proposed rule that you need to know.  Mary-Lou has been very involved in the remittance transfer rule from the start and gave a great presentation at our Compliance Seminar in October.  And, because of the importance of this rule - we are extending the early-bird registration price indefinitely.  You can sign-up for this webcast any time and receive the early-bird price.  

Remember: All of NAFCU's webcasts are available on-demand as well.  If you can't make the live webcast (perhaps because you need to watch the HMDA webinar or the Census webinar live), you can always watch the on-demand webcast at a later date.

• Top HR Compliance Issues Affecting Credit Unions in 2013 - Wednesday, February 6th from 2:00 - 3:30 p.m. EST.  Margaret Fiester from the Society of Human Resource Management (SHRM) will discuss how credit unions will be impacted by various future reforms - including tax reform and health care reform.  Register by January 30th to Save $100.  

NCCOs:  Both of the webcasts above will earn credits toward renewing your NAFCU Certified Compliance Officer (NCCO) designation.  If you see this logo -  - you'll be sure the webcast will be offering NCCO credits.

New NCCO Affidavit Process:  We also have a new, streamlined NCCO affidavit.  You can find the fillable-form located here.  If you are an NCCO and attend a NAFCU webcast with this symbol -   - be sure to use this form.   

CFPB Releases Semiannual Regulatory Agenda - Spring 2012; Seminar in Seattle

Written by Steve Van Beek

CFPB Regulatory Agenda.  Yesterday, the CFPB posted its Semiannual Regulatory Agenda - for spring 2012.  The previous Semiannual Regulatory Agenda was released in February 2012.  The latest release follows the same format and includes a listing of regulations in the various rulemaking stages: prerule stage, proposed rule stage, final rule stage, long-term actions and completed actions.  

Below is a listing of the various future regulations - organized by rulemaking stage.  Keep in mind the agenda is current as of April 13, 2012 and the CFPB has taken numerous actions since putting this agenda together.    

Prerule Stage:

• Registration of Certain Nonbank Covered Persons
• Supervision of Larger Depository Institutions and Affiliates
• Home Mortgage Disclosure Act (Regulation C)
• Requirements for Prepaid Cards (Regulation E) 

Proposed Stage:

• Amendments to TILA and FIRREA Concerning Appraisals
• Disclosure Rules and Substantive Protection for Certain High Cost Mortgage Loans (Regulation Z)** (proposed on July 9th)
• Mortgage Originator Standards (Regulation Z)
• Mortgage Servicing (Regulation X; Regulation Z)
• TILA/RESPA Mortgage Disclosure Integration (Regulation X; Regulation Z)** (proposed on July 9th)
• Credit Card Pre-Opening Account Fees (Regulation Z)
• Procedural Rule To Establish Supervisory Authority Over Certain Nonbank Covered Persons Based on Risk Determination
• Supervision of Certain Nonbank Covered Persons—Defining Larger Participants in Certain Consumer Financial Product and Service Markets (LP 2) 
• Copies of Appraisals or Other Valuations To Be Furnished by Creditor (Regulation B)

Final Rule Stage:

• Supervision of Certain Nonbank Covered Persons—Defining Larger Participants in Certain Consumer Financial Product and Service Markets (LP 1)** (finalized on July 16th)
• Disclosure of Records and Information
• State Official Notification Rule
• Rules Relating to Investigations
• Rules of Practice for Adjudication Proceedings
• Restatement of Federal Consumer Financial Law Regulations
• Requirements for Escrow Accounts (Regulation Z)
• TILA Ability to Repay (Regulation Z)
• Confidential Treatment of Privileged Information
• Disclosure Rules for Remittance Transactions (Regulation E)

Long-Term Actions:

• Alternative Mortgage Transaction Parity (Regulation D)
• Business Lending Data (Regulation B)
• TILA Mortgage Amendments (Regulation Z) 

Completed Actions: 

• Disclosure Rules for Remittance Transactions (Regulation E)

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Only 27 potential rulemakings!!  The Regulatory Agenda also includes a short summary of each rulemaking that is useful for providing a quick overview of what will be covered by the rulemaking.  However, as last Monday's proposed rules show - a short summary doesn't do much when the proposals are 1099 pages and 293 pages.  

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NAFCU's 2012 Regulatory Compliance Seminar.  Luckily, you don't have to read and understand all 27 potential rulemakings on your own.  We'll be covering quite a few of them at our 2012 Regulatory Compliance Seminar in Seattle, Washington - October 23-26.

The program-at-a-glance is available here (and we'll be including additional sessions as the proposals continue to flow).  We already have a session on the TILA/RESPA mortgage disclosures, the upcoming mortgage servicing proposal (including the periodic statement requirement) as well as a session on the remittances final rule.  Detailed session descriptions can be found here.

Remember - you do not need to be a NAFCU member to attend.  And, Save $100 if you Register by August 31st!

Did You Know?; Compliance Central; NCCO; Life is a Zoo

Written by Steve Van Beek

Did you know?  Each issue of NAFCU's The Federal Credit Union features a Compliance Central article from NAFCU staff.  Below are a few of the recent articles:

• March/April 2012:  A Closer Look at the CFPB
• January/February 2012:  A Look Down the 2012 Compliance Pike
• November/December 2011:  The CFPB, NAFCU and You
• September/October 2011:  Writing Effective Comment Letters

The Compliance Central is just one part of The Federal Credit Union.  You can see much more here.  

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NCCO.  And, a special "shout out" to Katey Proefke - Assistant Vice President of Compliance at Chevron FCU.  Katey was featured in the March/April 2012 Getting to Know... article where she listed these goals:

"What’s your next professional goal?

My next professional goal is to become a NAFCU Certified Compliance Officer. I am also working on creating an enterprise risk management “think tank” comprised of other credit union professionals and would like to eventually head up a risk management team."

Katey called very excited yesterday to inform me she had successfully passed all her NCCO exams and was officially an NCCO!  And, she has already had a couple of meetings with other professionals on enterprise risk management.  Great job Katey!

Full disclosure:  I have promised Katey that her first beer is on me at NAFCU's Regulatory Compliance Seminar in Seattle.  If you are a NCCO (or thinking about becoming one) - please consider joining us for both Seminar and the beer.  

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Life is a Zoo.  It has been a bit since the last "married life" update - we just hit the six-month mark a couple weeks and it seems to have flown by.  We had family in town the past two weekends and had a chance to slow down - including a visit to the National Zoo.  

Have a great weekend!