Legal Briefs October 1, 2010
Your update of the regulatory landscape.
Federal Reserve Board
The FRB has developed a new mail in version of the privacy opt-out form. The new model form provides one more option for credit unions to comply with the privacy regulations.
The FRB has published the final rule for parties acquiring loans in the Federal Register. The rule provides specifics on the disclosures which must be provided in writing no later than 30 days after the loan is sold, transferred or assigned. The effective and mandatory compliance date for the new rule is January 1, 2011.
The FRB has published the final rule for mortgage loan originator compensation in the Federal Register. The final rule prohibits mortgage loan originators from being compensated based on the terms of the loan. The final rule goes into effect on April 1, 2011.
The FRB published an interim final rule in the Federal Register regarding new disclosure requirements for home mortgage transactions. The new rule would replace the payment schedule section of a mortgage disclosure with a new payment disclosure based on the type of mortgage loan. The effective date of the new rule will be October 25, 2010. Comments are due by November 23, 2010, and the mandatory compliance date is January 30, 2011.
The FRB published a proposed rule for allowing higher HOEPA requirements on Jumbo mortgages. The new rule would set the escrow requirement trigger for jumbo mortgages to 2.5% above comparable transactions. The comment due date is October 25, 2010.
The FRB published proposed rules revisions for home-secured credit in the Federal Register. The proposed rule would make a number of changes regarding the member’s right to rescind and when a modification of an existing mortgage requires new disclosures. Comments are due by December 23, 2010.
The FRB announced that it will implement changes to its Payment System Risk policy on March 24, 2011. The PSR policy recognizes the Reserve Banks’ role in providing intraday credit to financial institutions.
National Credit Union Administration
The NCUA unveiled the Corporate System Resolution (CSR) website. The site provides information on the Stabilization, Resolution, and Reform process.
The NCUA has published the final rule regarding Short-Term, small amount loans. The new rule will allow federal credit unions to offer short-term, small amount loans as a viable alternative to predatory payday loans. The rule will be effective October 25, 2010.
The NCUA has released the fourth and final DVD about the corporate credit unions. The fourth DVD details the NCUA’s plan to resolve the legacy assets held by some of the nation’s largest corporate credit unions.
The NCUA published a legal opinion letter regarding compensation under 701.33. The letter discusses the use of the term compensation in 701.33 and the Internal Revenue Code that requires a Form 1099 to be issued to an individual.
The NCUA published a legal opinion letter regarding offering free use of coin sorting services to charitable organizations. The letter expresses the opinion that it is within the credit union’s incidental powers to offer this service as either as a form of marketing or part of the credit union’s charitable contribution.
The NCUA published a legal opinion letter regarding the use of long-term residential loans to purchase housing for the member’s college age family member. The credit union must look at the future use of the residence in order to determine if the loan is permissible.
Office of Foreign Assets Control
The OFAC SDN list was updated again. Last update September 29, 2010.
National Flood Insurance Program
The bill to extend the National Flood Insurance Program passed both the Senate and House. The bill will extend the NFIP until September 30, 2011.
The DSHS is removing access to cash benefits through debit-like Electronic Benefits cards from ATMs located in gambling establishments across the state. The move is to ensure the integrity of the State’s cash assistance program.
The FinCEN published a notice of proposed rulemaking. The new rule would require certain depository institutions and money service businesses to affirmatively provide records to FinCEN of certain cross-border electronic transmittals of funds. The comment due date is December 27, 2010.
The FASB published and update User Edition. The User Edition is a 3 page summary of recent new accounting standards and exposure drafts with links to Outreach documents.
The US Treasury department published the transfer of functions to the new Consumer Financial Protection Bureau. The CFPB will have functions transferred to it on July 21, 2011.
The DCU has announced the start of the process for rulemaking on the Assessment of Civil Money Fines. During the DCU rulemaking, stakeholders and interested persons are invited to attend and participate in the meetings.
The DCU has posted the link to the quarterly Asset Assessment Worksheet. Fourth quarter 2010 ACH debit will be originated on October 22, 2010.