ViClarity Compliance Update

​Analysis of mail theft-related check fraud and how credit unions should respond; phantom opt-in agreements; fair hiring rules, and much more.
 

The Dakota Credit Union Association’s dues-supported compliance solution –  ViClarity – is a world leader in credit union compliance. To read the complete articles that are linked, you will need to log in with your username and password. If you have questions about establishing your members-only account with ViClarity, click here for detailed instructions or contact John Alexander in the DakCU office.

FinCEN Releases FTA Addressing Mail Theft Related Check Fraud
The Financial Crimes Enforcement Network (FinCEN) released an in-depth Financial Trend Analysis (FTA) related to instances of mail theft-related check fraud. The analysis was released six months after a 2023 alert which addressed the same type of fraud. According to the analysis, FinCEN received 15,417 Bank Secrecy Act (BSA) Reports from 841 different financial institutions nationwide, totaling to more than $688 million in reported suspicious activity. The analysis was created in collaboration with the United States Postal Inspection Service (USPIS).
 
Credit unions across the country have had members that are victims of mail theft-related check fraud losses. If a credit union member has become a victim of mail theft-related check fraud, the credit union should file a Suspicious Activity Report pursuant to the requirements of BSA. Additionally, consider sending the members who are victims to the U.S. Postal Inspection Service for additionally filed reports. Learn more here.
 
CFPB Released Circular on “Phantom Opt-in” Agreements
The Consumer Financial Protection Bureau (CFPB) has released a circular which gives guidance to federal and state consumer protection enforcers to help prevent “phantom opt-in” agreements for overdraft programs.  The CFPB defines “phantom opt-ins” as instances in which a financial institution claims to have a consumer’s consent to opt-in to an overdraft program but cannot provide proof that the financial institution actually obtained consent.
 
The Electronic Funds Transfer (EFT) act requires financial institutions to obtain prior consent before enrolling a consumer into an opt-in program. Under EFT regulations, financial institutions are precluded from charging overdraft fees on ATM and one-time debit card transactions unless the consumer has specifically consented to the financial institution doing so. Read more on the topic here.
 
NCUA Finalizes Fair Hiring Rules and Simplifies Share Insurance Fund
The National Credit Union Administration (NCUA) has approved new rules for insurance simplification and for fair hiring. In general, the NCUA has approved a rule that would allow people with convictions for certain minor and older offenses to work in the credit union industry without needing to apply for the NCUA Board’s approval has simplified its share insurance regulations by adding a “trust account” category. Full article available here.

CFPB Proposed Rule on Change to Remittance Transfer Receipt Information
The Consumer Financial Protection Bureau (CFPB) has proposed a new rule which would change disclosure requirements for particular international money transfers, or remittances. Essentially, the proposed rule would amend the Electronic Fund Transfer Act and Regulation E to require that financial institutions provide consumers with clearer information about the types of inquiries that may be better handled by their remittance company before contacting the CFPB or the relevant state regulator. Additional information available here.