ViClarity Compliance Update

CFPB proposed rule to relax mortgage regs; FinCEN issues fraud scam alert; FFIEC mortgage lending data released; and 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/answers 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.

CFPB proposes rule to relax mortgage regulations.
Recently, the Consumer Financial Protection Bureau (CFPB) proposed a rule which would require mortgage servicers to focus on helping borrowers, when a homeowner asks for help. As part of the proposal, the rule would require servicers to offer assistance by reducing paperwork requirements, improve communication with borrowers, and ensure that critical information is provided in languages borrowers understand. Among other things, the CFPB is requesting comment on possible approaches it could take to ensure servicers are furnishing accurate and consistent credit reporting information for borrowers review for assistance.
 
While credit unions do not typically qualify as mortgage servicers, some of your credit union’s members may have received a mortgage outside of your credit union. Accordingly, in order to strengthen your credit union’s reputational risk, it may be to your credit union’s advantage to stay apprised of these proposed changes in order to better assist your members.
 
The proposed provisions would not apply to small servicers and all existing requirements will remain in effect until the effective date of a final rule. The CFPB will receive comments on the proposed provisions and the deadline to submit those comments is September 9, 2024.
Read the full article here.
 
FFIEC Releases Mortgage Lending Transaction Data
On July 11th, the Federal Financial Institutions Examination Council (FFIEC) published data for 2023 mortgage lending transactions. The data is included as part of the reporting requirements for the Home Mortgage Disclosure Act (HMDA) and covers 5,113 U.S. financial institutions, including banks, savings associations, credit unions, and mortgage companies.
 
Data from HMDA is used by the mortgage industry, consumer groups, regulators, and others to assess potential fair lending risks as well as other regulatory and informational purposes. Additionally, HMDA is supposed to help the public assess how financial institutions are serving the housing needs of their local communities and facilitate federal financial regulators’ fair lending, consumer compliance, and Community Reinvestment Act examinations. Read more on the topic here.
 
FATF Updates High-Risk Jurisdictions in Public Statement
The Financial Crimes Enforcement Network (FinCEN) is alerting U.S. financial institutions that the Financial Action Task Force (FATF) issued a public statement highlighting the increased financial connectivity of the Democratic People’s Republic of Korea (DPRK) with the international financial system. FATF is an intergovernmental body that established international standards for anti-money laundering (AML), countering the financing of terrorism (CFT), and countering the financing of proliferation of weapons of mass destruction (CPF).

FATF continues to have concerns over DPRK’s continued failure to address significant deficiencies in its anti-money laundering and countering of financial terrorism regime as well as the serious threats posed by the DPRK’s illicit activities related to the proliferation and financing of weapons of mass destruction. FATF is continuing to urge all jurisdictions to remain vigilant to risks to the international financial system and called for renewed implementation and enforcement countermeasures against DPRK. Read more here.

FinCEN Issues Alert for Fraud Scams Affecting BOI-Reporting Entities
Recently, the Financial Crimes Enforcement Network (FinCEN) released an alert drawing attention to the fraudulent attempts to solicit information from entities that may be subject to the Beneficial Ownership Information (BOI) reporting requirements under the Corporate Transparency Act. According to information released from FinCEN, those scams may include the following:

• Correspondence requesting payment. 
• Correspondence that asks the recipient to click on a URL or to scan a QR code. 
• Correspondence that references a “Form 4022,” or an “Important Compliance Notice.” 
• Correspondence or other documents referencing a “US Business Regulations Dept.” 

 Learn more here.