Product Updates for August 2020
The Product Updates for August 2020 from BankPolicies.com feature the following revised policy template products:
Bank Secrecy Act Policy Template – Comprehensive Version
Office of Foreign Assets Control Policy Template
The update to the Bank Secrecy Act Policy Template – Comprehensive Version is in response to:
FinCEN’s Alert FIN-2020-Alert001 entitled “FinCEN Alerts Financial Institutions to Convertible Virtual Currency Scam Involving Twitter” dated 07/16/20 to emphasize a high-profile scam exploiting Twitter accounts to solicit fraudulent payments denominated in convertible virtual currency (CVC). Cyber threat actors compromised the accounts of public figures, organizations, and financial institutions to solicit payments to CVC accounts, claiming that any CVC sent to a wallet address would be doubled and returned to the sender.
FinCEN’s Advisory FIN-2020-A005 entitled “Advisory on Cybercrime and Cyber-Enabled Crime Exploiting the Coronavirus Disease 2019 (COVID-19) Pandemic” dated 07/30/20 to alert financial institutions to potential indicators of cybercrime and cyber-enabled crime observed during the COVID-19 pandemic. Many illicit actors are engaged in fraudulent schemes that exploit vulnerabilities created by the pandemic. This advisory contains descriptions of COVID-19-related malicious cyber activity and scams, associated financial red flag indicators, and information on reporting suspicious activity.
In addition, the update to the Office of Foreign Assets Control Policy Template and Bank Secrecy Act Policy Template – Comprehensive Version is in response to OFAC’s Final Rule dated 08/10/20 that announced technical amendments to the definition of “applicable schedule amount” in its regulations. In recent years, OFAC has adjusted its civil monetary penalties (CMPs) as required by the Federal Civil Penalties Inflation Adjustment Act, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. While OFAC’s “applicable schedule amount” values are not civil monetary penalties that are required to be adjusted pursuant to such statute, OFAC is making technical changes to this definition to ensure the applicable schedule amount values continue to correspond appropriately to OFAC’s CMPs.
As a reminder, the complete contents of the Office of Foreign Assets Control Policy Template are included as Topic 19 within the Bank Secrecy Act Policy Template – Comprehensive Version.
Payday, Vehicle Title, and High-Cost Installment Loan Policy Template
The update to these products is in response to the CFPB’s Press Release entitled “Consumer Financial Protection Bureau Issues Final Rule on Small Dollar Lending” dated 07/07/20 that issued a final rule concerning small dollar lending in order to maintain consumer access to credit and competition in the marketplace. The final rule rescinds the mandatory underwriting provisions of the 2017 rule after re-evaluating the legal and evidentiary bases for these provisions and finding them to be insufficient. The final rule does not rescind or alter the payments provisions of the 2017 rule. The final rule if effective October 20, 2020.
As a reminder, the complete contents of the Payday, Vehicle Title, and High-Cost Installment Loan Policy Template are included within the Consumer Loan Policy Template as Topic 16.
Federal Deposit Insurance Act Section 19 Policy Template
Human Resources General Policy Template
The update to these products is in response to the FDIC’s FIL-72-2020 entitled “FDIC Issues Final Rule Revising and Codifying Section 19 to Allow Greater Employment Opportunities for Individuals with Certain Minor Criminal Offenses on Their Records” dated 07/24/20 that announced the approval of a final rule to revise and incorporate into the agency’s regulations a longstanding Statement of Policy (SOP) related to individuals with certain criminal offenses on their records who seek employment in the banking industry. Section 19 of the Federal Deposit Insurance Act (Section 19) prohibits a person from participating in the affairs of an FDIC-insured institution if he or she has been convicted of a crime involving dishonesty, breach of trust, or money laundering, or has entered into a pretrial diversion or similar program in connection with a prosecution for such an offense, without the prior written consent of the FDIC. Revising and codifying the SOP into the regulations will provide better transparency and clarity regarding the interpretation of Section 19 and the application process.
Marketing Plan and Program Policy Template
Unfair, Deceptive, or Abusive Acts or Practices (UDAAP) Policy Template
Unfair or Deceptive Acts or Practices (UDAP) Policy Template
The update to these products is in response to the OCC’s Bulletin 2020-65 entitled “Unfair or Deceptive Acts or Practices and Unfair, Deceptive, or Abusive Acts or Practices: New Comptroller’s Handbook Booklet and Recissions” dated 06/29/20 that announced a new “Unfair or Deceptive Acts or Practices and Unfair, Deceptive, or Abusive Acts or Practices” booklet of the Comptroller’s Handbook. The booklet contains information regarding supervision of a bank’s practices related to section 5 of the Federal Trade Commission (FTC) Act, which prohibits banks from engaging in unfair or deceptive acts or practices (UDAP), and sections 1031 and 1036 of the Dodd–Frank Wall Street Reform and Consumer Protection Act, which prohibit unfair, deceptive, or abusive acts or practices (UDAAP). The bulleting also rescinds:
- Office of Thrift Supervision Examination Handbook, section 1354, “Unfair or Deceptive Acts or Practices, Federal Trade Commission Act, Section 5.”
- Office of Thrift Supervision Examination Handbook, section 1355, “Unfair or Deceptive Acts or Practices – Credit Practices Rule.”
Non-Accrual and Charged-Off Loan Policy Template
Troubled Debt Restructuring and Loan Workout Policy Template
The update to these products is in response to the FFIEC’s Press Release entitled “Joint Statement on Additional Loan Accommodations Related to COVID-19″ dated 08/03/20 that sets forth prudent risk management and consumer protection principles for financial institutions to consider while working with borrowers as initial coronavirus-related loan accommodation periods come to an end and they consider additional accommodations.
As a reminder, the complete contents of the Troubled Debt Restructuring and Loan Workout Policy Template are included as Topic 8 within the Non-Accrual and Charged-Off Loan Policy Template.
Regulation O and Insider Activity Policy Template
The update to this product is in response to the Federal Reserve’s interim final rule dated 07/15/20 to except certain loans made by June 30, 2020, that are guaranteed under the Small Business Administration’s Paycheck Protection Program from the requirements of the Federal Reserve Act and the corresponding provisions of the Federal Reserve Board’s Regulation O. This interim final rule to expand the exception to apply to PPP loans made through August 8, 2020, and is effective July 16, 2020.
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