It’s Time to Think About Renewing Your Legal Entity Identifiers

LEIs are generally required to be renewed for Home Mortgage Disclosure Act (HMDA) reporting purposes.

10/8/2019

Compliance

Reminder – Time to Think About Renewing Your LEIs

With the new HMDA requirements that went into effect Jan. 1, 2018, many credit unions obtained Legal Entity Identifiers (LEI). There are several companies that offer LEIs; however, each LEI is generally required to be renewed. If your credit union has an LEI, you may want to start thinking about when you need to renew it for HMDA reporting purposes.

Question of the Week

Q. How long do I have to close an account after a member’s death?

A. After the death of a member, the credit union cannot report the funds under the deceased member’s Social Security Number beginning the reporting period the calendar year after the member died. 

For example, if the member died during 2015, the credit union cannot continue to report the funds under the deceased’s SSN beginning Jan. 1, 2007. However, if the credit union is unable to determine to whom the funds belong, the credit union can continue to report under the deceased member’s SSN until the account has reached dormancy.

Legal Briefs

National Credit Union Administration (NCUA)

Payday Alternative Loans
The NCUA Board is issuing a final rule (referred to as the PALs II rule) to allow federal credit unions (FCUs) to offer additional payday alternative loans (PALs) to their members. The final rule does not replace the NCUA’s current PALs rule (referred to as the PALs I rule). Rather, the PALs II rule grants FCUs additional flexibility to offer their members meaningful alternatives to traditional payday loans while maintaining many of the key structural safeguards of the PALs I rule.

Federal Credit Union Bylaws
The NCUA Board is issuing a final rule to update, clarify, and simplify the federal credit union bylaws (FCU Bylaws). The final rule updates and conforms the FCU Bylaws to legal opinions issued by the NCUA’s Office of General Counsel and provides greater flexibility to federal credit unions (FCUs). The final rule also makes other changes that are designed to remove outdated or obsolete provisions.

Supervisory Committee Audits and Verifications
The Board is amending its regulations governing the responsibilities of a federally insured credit union (FICU) to obtain an annual supervisory committee audit of the credit union. The final rule implements recommendations outlined in the agency’s Regulatory Reform Task Force’s Regulatory Reform Agenda (Agenda) and will provide additional flexibility to FICUs. Specifically, the Board is: Replacing the Supervisory Committee Guide with a simplified appendix to the part; eliminating two audit types that FICUs seldom use; and eliminating a specific deadline for outside, compensated persons to deliver written audit reports to FICUs.

Request for Comment: Agency Information Collection Activities – Monitoring Bank Secrecy Act Compliance
Section 748.2 of NCUA’s regulations, directs credit unions to establish a Bank Secrecy Act (BSA) compliance program that maintains procedures designed to assure and monitor compliance with the requirement of 31 U.S.C., Chap. 53, Subchapter II (sec. 5301-5329), the Bank Secrecy Act (31 U.S.C. 5318(g)), and 31 CFR Chapter X (parts 1000-1099), Financial Crimes Enforcement Network, Department of the Treasury. 

The public is invited to submit comments concerning: (a) whether the collection of information is necessary for the proper execution of the function of the agency, including whether the information will have practical utility; (b) the accuracy of the agency’s estimate of the burden of the collection of information, including the validity of the methodology and assumptions used; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of the information on the respondents, including the use of automated collection techniques or other forms of information technology.

Request for Comment: Production of Non-Public Records and Testimony of Employees in Legal Proceedings
12 CFR part 792, subpart C requires anyone requesting NCUA non-public records for use in legal proceedings, or similarly the testimony of NCUA personnel, to provide NCUA with information regarding the requester’s grounds for the request. This process is also known as a “Touhy Request.” The information collected will help NCUA decide whether to release non-public records or permit employees to testify in legal proceedings. 

Consumer Financial Protection Bureau (CFPB)

Correction to the Fair Lending Report of the Bureau of Consumer Financial Protection
Corrected an omission of a 2018 referral by the Federal Deposit Insurance Corporation (FDIC) to the U.S. Department of Justice (DOJ) involving national origin discrimination in violation of the Equal Credit Opportunity Act (ECOA). 

Federal Reserve (FRB)

Regulation D: Reserve Requirements of Depository Institutions
The Board of Governors of the Federal Reserve System (“Board”) is amending Regulation D (Reserve Requirements of Depository Institutions) to revise the rate of interest paid on balances maintained to satisfy reserve balance requirements (“IORR”) and the rate of interest paid on excess balances (“IOER”) maintained at Federal Reserve Banks by or on behalf of eligible institutions. The final amendments specify that IORR is 1.80 percent and IOER is 1.80 percent, a 0.30 percentage point decrease from their prior levels. The amendments are intended to enhance the role of such rates of interest in moving the Federal funds rate into the target range established by the Federal Open Market Committee (“FOMC” or “Committee”).

Office of Foreign Assets Control (OFAC)

OFAC has updated the Specially Designated Nationals And Blocked Persons List (SDN) as of Oct. 2 and 4, 2019. The most recent update before this was Sept. 26, 2019.

Notice of OFAC Sanctions Actions
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is publishing the names of one or more persons, aircraft, and vessel that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List based on OFAC’s determination that one or more applicable legal criteria were satisfied.

Notice of OFAC Sanctions Actions
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is publishing the names of one or more persons that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List based on OFAC’s determination that one or more applicable legal criteria were satisfied.

­­­­­­­­­­­­­­­­­­­­­Questions? Contact the Compliance Hotline: 1.800.546.4465; [email protected].