Interagency Guidance to Issuing Banks on Applying Customer Identification Program Requirements to Holders of Prepaid Cards

Functionalities that make prepaid cards attractive to consumers also pose risks for financial institutions that issue prepaid cards and process prepaid card transactions. For example, easy access to prepaid cards, the ability to use them anonymously, and the potential for relatively high volumes of funds to flow through pooled prepaid access accounts, make prepaid cards potentially vulnerable to criminal abuse. … Read More

Effective September 23, 2016, stale-dated ACH entries will result in a fee

Reprinted from Fedflash Effective September 23, 2016, with Phase 1 implementation of the Same Day ACH Rules change, a current-day or stale-day date in the effective entry date field of a credit entry will trigger same-day processing (provided the other requirements are also met). Every Automated Clearing House (ACH) network participant should be aware of the Same Day Entry Fee … Read More

BSA Violations

FinCEN’s penalty assessment against Gibraltar Private Bank reads like a Stephen King novel for BSA compliance officers. The ongoing deficiencies and either the willful blindness or ignorance by Gibraltar caused me heartburn just reading the assessment report. Gilbraltar’s issues have been ongoing since at least 2010, when the OCC first warned Gibraltar of its BSA deficiencies. A Consent order was … Read More

No-Action Letters

The CFPB finalized a policy that aims to promote innovation in the financial services marketplace. Generally, the policy establishes a process for companies to apply for a “no-action letter” from the Bureau. The no-action letter essentially indicates that the Bureau has no present intention to recommend or initiate any enforcement or supervisory action with respect to the company’s product or … Read More

More BSA on the way?

In January, the Government Accountability Office released a report, in response to Congress’ request, titled Internal Remittances – Money Laundering Risks and Views on Enhanced Customer Verification and Recordkeeping Requirements. This was initiated from a 2015 Senate bill, the Remittance Status Verification Act of 2015.  While the Act did not proceed further, it would have required remittance transfer providers (including credit unions) to, before … Read More

MSB Refresher

The NCUA released its February 2016 issue of the NCUA Report. The Report contains a good overview of the requirements for credit unions if they offer accounts to Money Service Businesses. While credit unions are allowed to provide accounts and services to MSBs, the credit unions must have proper controls in place to identify and manage the risks inherent with … Read More

In the legislature

Washington and Oregon’s legislature is back in session after the holidays, and both states have a couple bills that, if enacted, would have impact on credit unions. In Washington, Senate Bill 5635 would repeal Washington’s Power of Attorney Act and replace it with a modified Uniform Power of Attorney Act – which 18 states have currently adopted.  This bill is … Read More

CFPB Takes Steps to Improve Checking Account Access

Through a field hearing on checking account access, the release of an announcement and Compliance Bulletin 2016-01, the CFPB encourages financial institutions to provide lower-risk accounts to consumers that either do not want, or are unable to qualify for an account, that provides overdraft protection. The releases contain a number of items related to this topic. Lower-Risk Product Offering The … Read More

Proposed changes to CTR

FinCEN seeking input on proposed changes to improve the layout of the CTR form. FinCEN is proposing a number of technical changes to the CTR (or BCTR – Bank Secrecy Act Currency Transaction Report) to allow for alternative reporting models that have developed since the current CTR was created. The proposed changes include reports filed by a parent company on … Read More

Enhanced Share Insurance Coverage

The NCUA issued Letter 16-RA-02 that discusses the enhanced insurance coverage for IOLTA, real estate escrow, and prepaid funeral accounts. The letter also includes an attachment – Guidance on Enhanced Share Insurance, which provides more information. The letter states: Dear Board of Directors and Chief Executive Officer: As of January 27, 2016, three types of credit union accounts are eligible … Read More