Legal Briefs August 16, 2010
Your update of the regulatory landscape.
Federal Reserve Board
The FRB announced the approval of an interim final rule implementing recent changes to the effective dates of the gift card act. The new rule will change the disclosure requirements of prepaid cards produced prior to April 1, 2010. The new effective date for the disclosure requirements will be January 31, 2011.
The FRB released the Federal Open Market Committee outlook. The Committee anticipated that the pace of economic recovery to be more modest in the near term.
The FRB proposed an interim rule that revises the disclosure requirements for closed-end mortgage loans under Reg Z. The interim rule implements provisions of the Mortgage Disclosure Improvement Act. The mandatory compliance date with the new rule will be January 30, 2011. Comments are due by October 15, 2011.
The FRB announced final rules to implement changes to Reg Z. The change is to implement the consumer notification when their mortgage loan has been sold or transferred. The mandatory compliance date with the rules is January 1, 2011.
The FRB issued a proposed rule to revise the escrow account requirements for higher-priced, first-lien “jumbo” mortgage loans. Under the new change the HOEPA escrow requirements on Jumbo loans will be an APR of 2.5% greater than the applicable prime rate offer. The board is soliciting comments for 30 days after publication in the Federal Register.
The FRB announced proposed enhanced consumer protections and disclosures for home mortgage transactions. The enhancements will make a number of changes to Reg Z, which can be seen on the highlights page. The comment period for this will end on November 15, 2010.
The FRB announced final rules to protect mortgage borrowers from unfair, abusive, or deceptive lending practices. The new rule applies to the compensation practices of all persons who originate home mortgages. Highlights are available and the new rule will go into effect on April 1, 2011.
National Credit Union Administration
The NCUA published an interim final ruling to provide a definition of “low-income members”. The new definition will be “Low-income members are those members whose family income is 80% or less than the median family income for the metropolitan area where they live of national metropolitan area.”
The NCUA published an interim final rule to conform its Truth in Savings regulation with the FRB’s. The final rule amends sections 707 to conform with the FRB’s reg DD.
The NCUA published a proposed rule for golden parachute payments. The proposed rule will prohibit federally insured credit unions from making golden parachute and indemnification payments to an institution-affiliated party.
The NCUA posted the initial board meeting video. The posting of the July 29th Board meeting video is an effort to enhance the transparency of the Board’s decision making process.
Financial Crimes Enforcement Network
The FinCEN has updated the 314 (a) Fact Sheet.
Office of Foreign Assets Control
The OFAC SDN list was updated again. Last update August 13, 2010.
Federal Trade Commission
The FTC proposed changes to update and improve credit reporting notices. The proposed changes are designed to reflect new rules that the FTC and other financial regulators have enacted under the FCRA. Comments on the proposed changes are due on September 21, 2010.
The FFIEC released guidance on reverse mortgage products. The guidance emphasizes the consumer protection concerns raised by reverse mortgages. The guidance will be effective 60 days after publication in the Federal Register. About October 16, 2011.