Compliance Center: DFI Issues New Interpretive Letters Regarding Associate Board Member and Director Emeritus Expense Reimbursement
June 22, 2015
June 22, 2015
The Washington State Department of Financial Institutions Division of Credit Unions (DCU) released two new Interpretive Letters.
I-15-02 discusses reimbursement for Associate Board Members, and the DCU concluded, “Washington State chartered credit unions may appoint associate board members, but they may not compensate them as if they were elected directors, supervisory committee members, or board officers. However, an associate board or supervisory committee member may receive reimbursement of training and travel expenses that are appropriate to the service being provided. Also, as stated in Interpretive Letter I-08-01, associates may need to be covered by insurance, just like full board members.”
Similarly, I-15-03 discusses reimbursement for Director Emeritus positions, and the DCU concluded, “I have no objection to a Washington State chartered credit union amending its bylaws to appoint a former director as a “director emeritus.” However, a bylaw amendment must be made to establish the director emeritus designation, its term of service, the requirements for attendance at board meetings, and to prohibit the director emeritus from voting on board of directors’ business. Additionally, the director emeritus is not eligible for insurance benefits but may be reimbursed for training and travel expenses if the individual provides services that are established by the board and that go beyond merely serving in an honorary capacity.”
Compliance Question of the Week
If we want to ask our members to donate to CULAC, what disclosures are required?
The following disclosure is required:
Federal Election Law Requires the Following Disclosures in all CULAC Materials:
Contributions to CULAC are not tax deductible. All contributions are voluntary and will be used for political purposes. You have the right to refuse to contribute without any reprisal. Guidelines contained herein are merely suggestions. You may contribute more or less that the guidelines suggest, and you will not be favored nor disadvantaged by reason of the amount of your contribution or a decision not to contribute.
Additionally, with donations over $50, you must obtain the following information:
You must obtain and report the name, home address (as required by the FEC), occupation, and employer of each contributor who gives $50 or more to CULAC.
Contributions need to be posted by certain dates. The quickest and easiest way to transmit funds is through the CUTS. If you collect checks, they must be mailed each Friday of the month (July 5, 12, 19, and 26) as required by the FEC.
Items being mailed must include a contribution form listing all donors and be sent to CULAC at the following address:
601 Pennsylvania Ave., NW
Ste. 600, South Building
Washington, D.C. 20004-2601
All checks sent in must be made out to CULAC. Do not send cash.
When possible, it is requested that the credit union collect the donations and send in one (1) check along with the contribution form. A typed copy of the contribution form that lists everyone’s name, home address, title, and amount contributed needs to be mailed with the check(s), as well as email to email@example.com.
The contribution form should list a total for donations received each week, it should not list a cumulative total. Email Samantha Beeler at firstname.lastname@example.org at the end of July with the number of participants you had along with the amount your credit union raised.
National Credit Union Administration (NCUA)
The NCUA issued its Board Action Bulletin, detailing its June 18, 2015 board meeting. During the meeting, the board proposed a modernized member business lending rule, voted to extend the current federal credit union interest rate cap of 18 percent through March 10, 2017, and approved a request for comment on modifying and repealing regulations.
The June 2015 issue of the NCUA Report is now available.
The NCUA released its newest economic video which states that improvements in the national economy, including solid job growth and falling unemployment point to continued loan demand.
The NCUA, jointly with the other federal regulators, issued a final rule on flood insurance. The final rule caries two effective dates—October 1, 2015 for certain provisions and January 1, 2016 for others. The escrow portion of the rule does not take effect until January 1, 2016.
The NCUA and AARP announced that they will jointly hold a webinar on detecting, preventing, and reporting elder abuse. The webinar will be on Wednesday, June 24 at 2pm EST. Credit unions can register for the webinar here.
Consumer Financial Protection Bureau (CFPB)
CFPB Director Cordray delivered prepared remarks at the Consumer Advisory Board Meeting.
CFPB Director Cordray released a statement indicating that the CFPB will issue a proposed amendment to the TILA/RESPA Integrated Disclosure Rule that would delay the effective date to October 1, 2015.
The CFPB’s Student Loan Ombudsman released a report indicating that consumers are being rejected when applying for a co-signer released on their student loans.
Office of the Comptroller of the Currency (OCC)
The OCC issued a revision to its Comptroller’s Handbook. The booklet, Residential Real Estate Lending, replaces the Real Estate Loans Booklet issue in 1990.
Federal Trade Commission (FTC)
The FTC issued a proposed amendment to its Privacy of Consumer Financial Information Rule. The rule required that certain motor vehicle dealers provide an annual disclosure to their customers by hand delivery, mail, or electronic delivery (only with consent). The proposed amendment would allow the dealers to notify their customers that the notice is available via their website.
United States Treasury (Treasury)
The Treasury issued two new assessments aimed at helping the public and private sectors more effectively detect and combat illicit finance. The National Money Laundering Risk Assessment identifies the money laundering risks that are of priority concern to the United States. The National Terrorist Financing Risk Assessment identifies the terrorist financing risks that are of priority concern.
The Treasury released proposed and temporary Multiemployer Pension Reform Act regulations, addressing how multiemployer plans will handle a temporary or permanent reduction of pension benefits if the plan is projected to run out of money.
Treasury Secretary Lew testified before the House Committee on Financial Services. The testimony focused on the 2015 Annual Report of the Financial Stability Oversight Council. The report focused on 11 themes that Lew says “warrant continued attention” and include topics including cybersecurity, financial innovation and migration or activities, and housing financing reform.
Treasury Secretary Lew announced that the new $10 bill will feature a woman once it is redesigned.
Federal Deposit Insurance Corporation (FDIC)
The FDIC released the Spring 2015 edition of its Consumer News Publication.
Federal Reserve Board (FRB)
The FRB has published its updated Reserve Maintenance Manual.
The FRB’s June edition of FedFlash is now available.
The FRB issued a reminder regarding their new posting rules operational and product changes that take effect on July 23, 2015.
The FRB has announced its final rule amending Reg D, which makes changes to the calculation of interest payments on excess payments on excess balances maintained by depository institutions at Federal Reserve Banks. The final rule will be effective on July 23, 2015.
Office of Foreign Assets Control (OFAC)
OFAC has updated the SDN list as of June 11, 2015. The last update prior to this was June 10, 2015.
Questions? Contact the Compliance Hotline: 1.800.546.4465, email@example.com.