Compliance Update with Amy K

​NCUA regulations to be reviewed in 2023; subordinate debt final rule; a credit union audit solution, and a little ditty of a song about compliance love. 

Amy K - compliance expert & freelance composer.

by Amy Kleinschmit, Chief Compliance Officer 

NCUA Regulatory Review
The National Credit Union Administration (NCUA) has announced the section of regulations that it will be reviewing in 2023, which is listed below. The NCUA reviews all of its existing regulations every three years. The NCUA’s Office of General Counsel maintains a rolling review schedule that identifies one-third of the NCUA’s existing regulations for review each year.

Comments regarding the below listed regulations need to be submitted to [email protected] by June 30, 2023. Please include the words “Regulatory Review (2023)” in the subject line. Per the announcement, it is “NCUA’s goal is to ensure that all of our regulations are clearly articulated and easily understood. Comments are welcome on that aspect, as well as substantive suggestions for regulatory changes.”

The following Parts of NCUA’s rules and regulations will be reviewed in 2023:
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711 Management Official Interlocks
712 Credit Union Service Organizations (CUSOs)
713 Fidelity Bond and Insurance Coverage for Federally Insured Credit Unions
714 Leasing
715 Supervisory Committee Audits and Verifications
717 Fair Credit Reporting
721 Incidental Powers
722 Appraisals
723 Member Business Loans; Commercial Lending
724 Trustees and Custodians of Certain Tax-Advantaged Savings Plans
725 National Credit Union Administration Central Liquidity Facility
740 Accuracy of Advertising and Notice of Insured Status
741 Requirements for Insurance
745 Share Insurance and Appendix
746 Appeals Procedures
747 Administrative Actions, Adjudicative Hearings, Rules of Practice and Procedure, and Investigations
 
NCUA Final Rule
At its recent board meeting, the NCUA finalized its rule relating to Subordinate Debt, which can be found here and will be effective 30 days after it is published in the Federal Register. In September 2022, the NCUA Board issued the proposed rule to permit Grandfathered Secondary Capital to be included in Regulatory Capital for up to 30 years from the latter of the date of issuance, or January 1, 2052. The NCUA also proposed to remove the maximum maturity limit of 20 years from § 702.404(a)(2) and, in its place, set forth a requirement that a credit union must provide certain information in its application for preapproval under § 702.408 when applying to issue Subordinated Debt Notes with maturities longer than 20 years. After review of the comments received, the NCUA Board finalized the proposed amendments without change.

Compliance Solution Highlight
AffirmX Risk Intel Center helps credit unions adhere to government regulations in a proactive and cost efficient manner through a patented, cloud-based platform that is customized and branded for your institution.
The platform draws on internal and external data sources to develop risk-based priorities to help you quickly identify issues, reduce costs and streamline compliance management practices.

Unlike checklist-based systems that place the burden for understanding compliance requirements on your team, Risk Intel Center combines easy-to-use workflows with expert analysis and a risk-based dashboard to help your team stay on top of compliance issues ranging from BSA to Fair Lending and Enterprise Risk.

Looking for just one type of audit? AffirmX can be tailored to meet the needs of your credit union including offering individual audits – such as BSA Independent Audit, Annual ACH Independent Audit, Annual SAFE Act Independent Audit and Website Compliance Review. Pick just one or bundle the four audits together!
For Questions or pricing – contact Amy Kleinschmit [email protected]
 
A Little Ditty about Compliance
As you may recall, last week I explored how AI could potentially impact the compliance officer’s job at the credit union asking one of the AI applications, in this case ChatGPT, various compliance questions and also asking it to attempt completion of a common compliance officer role - summarize a newly proposed rule.

This week I revisit ChatGPT, however, this time I offer the following response from this app to hopefully lighten the mood for you. I present to you a love song about compliance. (We are still fielding potential performers to give this song the proper justice it deserves.)

Verse 1: You might think it's mundane, But to me, it's all so clear.
I see the beauty in the rules, And I'm drawn to them, my dear.
 
Chorus: Compliance, oh compliance, You make my heart beat fast.
Following the regulations, Is a love that's built to last.
 
Verse 2: Some may see it as a chore, A burden hard to bear.
But I see it as a promise, To always do what's fair.
 
Chorus: Compliance, oh compliance, You make my heart beat fast.
Following the regulations, Is a love that's built to last.
 
Bridge: I'll never stray from what's right, My devotion runs so deep.
I'll follow every guideline, And forever you I'll keep.
 
Chorus: Compliance, oh compliance, You make my heart beat fast.
Following the regulations, Is a love that's built to last.
 
Outro: So let's embrace the regulations, And never let them go.
Compliance, oh compliance, You're the love that makes me grow.
 
Compliance questions or audition tapes may be submitted to Amy Kleinschmit by any DakCU member.  

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