(July 9, 2021) Community First Fund Federal Credit Union, of Lancaster, Penn., was chartered this week by NCUA, the second credit union chartered so far this year by the federal regulator. The new institution is sponsored by the nonprofit Community First Fund to serve the approximately 550,000-person community of Lancaster County; operations are expected to begin by year’s end. The credit union plans to offer credit cards and first mortgages … The position of chief operating officer (COO) is “retired” at the OCC under a reorganization plan announced this week by the agency; however, Blake Paulson, the veteran occupant of that position (and former acting comptroller) will stay with the agency but in a new role. The agency’s bank supervision units (the bank supervision policy, midsize and community bank supervision, large bank supervision, and supervision risk and analysis) and the office of management will now report directly to Acting Comptroller Michael J. Hsu. Since 2019, those divisions reported to the agency’s COO … NASCUS participated in this week’s annual conference of the International Credit Union Regulators’ Network (ICURN), held virtually Wednesday and Thursday. NASCUS President and CEO Lucy Ito serves on the ICURN Board of Directors. In conjunction with the event, ICURN announced a new virtual training program for credit union supervisors, running from Sept. 20-24. The virtual course is based on the group’s in-person training program, ICURN said.
(July 9, 2021) Landlords, consumer reporting agencies (CRAs), and others are reminded of their obligations to accurately report rental and eviction information in a compliance bulletin published by CFPB this week, highlighting the agency’s continuing concerns of an expected surge in evictions in the coming months.
The bureau’s compliance bulletin 2021-03 (“Consumer Reporting of Rental Information”) was issued amid soon-expiring COVID-19 pandemic-related protections for renters. The Centers for Disease Control and Prevention (CDC) had extended federal eviction protections implemented during the pandemic through July.
The CFPB states the bureau would be “paying particular attention” to CRAs’ and information furnishers’ compliance with accuracy and dispute obligations under the Fair Credit Reporting Act (FCRA) and Regulation V with respect to rental information.
“The Bureau will hold CRAs and furnishers accountable for failing to comply with the FCRA and Regulation V,” the CFPB wrote. “The economic recovery of renters and their ability to secure new rental housing should not be impeded by noncompliance with the law.”
The bulletin took effect upon its publication Wednesday in the Federal Register.
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(July 9, 2021) Consumer complaints about federal student loans fell off during the coronavirus crisis, but protests about overdraft fees on checking accounts surged due to financial institutions attempting to help consumers have access to economic impact payments (EIPs), according to the complaint bulletin issued late last week by CFPB.
The bureau’s bulletin looks at consumer complaints related to three actions taken by Congress in response to the coronavirus crisis. Those were: suspension of monthly payments for federal student loans, issuance of EIPs to eligible households; and promulgation of an interim final rule in support of the Center for Disease Control and Prevention (CDC)’s eviction moratorium.
The bulletin said the key takeaways from the bureau’s analysis of these actions showed:
- Federal student loan complaint volume decreased significantly following suspension of payments; however, borrowers reported issues with customer service and sometimes experienced delays in getting responses to their complaints.
- The customer service issues in student loan complaints raise concerns about servicers’ preparedness for student loan borrowers resuming payments, particularly borrowers who have experienced a decrease in income.
- Renters have submitted few complaints about third-party debt collectors, or attorneys, who are attempting to carry out an eviction; more often, renters described issues with collections for past evictions or expressed concerns about negative credit reporting.
- Consumers reported being charged overdraft fees on their checking accounts when funds advanced by their financial institutions—so consumers could have access to all of their EIP funds—were later reversed.
Regarding the overdraft fees, the bulleting notes that financial institutions – as a courtesy to consumers who had overdrawn deposit accounts – advanced to their members or customers an amount equal to the negative balance so those consumers could reap full advantage of the EIP. However, the bulletin notes, those advances were later reversed, typically 30 days after the advance.
According to the bulletin, a limited number of complaints were received that consumers did not realize that an advance was posted to their account. “Many of these consumers reported learning of the advance only after the funds were debited from their accounts several weeks later,” the bulletin asserts.
“In response to these complaints, several financial institutions reiterated the intention of the advance was so that consumers could make full use of their stimulus payments,” the bulletin states. “In some limited circumstances, financial institutions refunded overdraft fees charged to the consumers’ accounts, stating they were refunding the fees as a courtesy.” A breakdown of what sort of financial institution (credit union, bank or other) refunded the fees was not provided.
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CFPB Complaint Bulletin: COVID-19 issues described in consumer complaints
(July 9, 2021) Diane Reed, president of HRDoc in Fairfax, Va., is the latest speaker to be added to the roster addressing the 2021 NASCUS State System Summit (S3), a virtual event set for Aug. 17-18. Reed will be speaking about employment trends at credit unions. A veteran credit union human resources professional, Reed provides HR training (including policy creation and review), organizational structure planning and review, and more. Reed is slotted for a Thursday, Aug. 17, session at the S3 conference.
Also, as a reminder: Next week (July 16) the first session of the NASCUS/CUNA BSA/AML Certification E-School gets underway. The overall program runs through Dec. 14. The multi-month program helps credit unions be in compliance with all provisions of the Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) regulations. The program also offers the opportunity for participants to earn or recertify their Bank Secrecy Act Specialist (BCACS) designation.
LINKS:
2021 NASCUS State System Summit (including registration and agenda)
BSA/AML Certification eSchool with CUNA (including registration and agenda)
(July 9, 2021) It’s time to register for NASCUS 101 – the popular series of webinars that explains how NASCUS members can get the most out of their memberships – set for Aug. 12.
The series of webinars covers the many ways NASCUS members can reap the most of their memberships, in just 30 minutes, with a concise, but detailed, overview touching on NASCUS legislative and regulatory (L&R) resources, educational offerings and webinars, member engagement, as well as news and data.
Additionally, the program shows members how to volunteer for a committee or working group, personalize member communications and sign up for regulatory and security alerts – as well as how to connect with other members to exchange ideas and collaborate. Also highlighted during the session: NASCUS’ latest product, Campus 365 (powered by BAI), which helps members hone their compliance and professional skills training, and more.
The bi-monthly series — free and open to all NASCUS members — illustrates how collaboration among all 45 regulatory agency members, committees, credit unions, leagues, corporates, trade associations, and CUSOs can support the credit union system.
In addition to the August session, NASCUS 101 is also scheduled for Oct. 14 and Dec. 9. See the link below for more details, including registration.
LINK:
NASCUS 101 (via the NASCUS Member Portal)
(July 9, 2021) A slow, methodical approach should be taken to determining the best regulatory scheme to address the use of the developing technology of artificial intelligence/machine learning (AI/ML) by financial institutions, the state system has advised NCUA and the CFPB in a comment letter submitted late last week.
In addition, NASCUS wrote in its comment letter to the agencies, that approach must also incorporate “close coordination and collaboration between federal and state regulators in addition to the continued collection of input from other stakeholders.”
In March, the agencies opened a 60-day comment period (which they later extended by 30 days) for Information about how financial institutions use AI in their activities, including fraud prevention, personalization of customer services, credit underwriting, and more.
NASCUS wrote that, in developing guidance and regulation, the agencies would need to provide “insight on important factors such as choosing appropriate data sets, transparency, explainability, accountability and appropriate assessment standards among other things.”
Noting that any guidance and regulation would need to be risk-based and flexible but not stifle innovation, NASCUS said it strongly encouraged the agencies to develop rules and guidelines that would accommodate the needs of all institutional asset sizes. “Guidance or regulation that is too inflexible or that makes AI/ML cost prohibitive may severely impact smaller institutions’ ability to utilize these tools, which may ultimately result in lost opportunities/advantages for impacted consumers,” NASCUS wrote.
The state system also recommended a common lexicon be developed for use of AI to establish a common understanding of just what the technology (and related concepts) constitutes. “An agreed-upon set of foundational definitions would likely go a long way toward avoiding future confusion among stakeholders related to divergent regulatory guidance and rules issued to address this area,” NASCUS advised.
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