Compliance Blog

Written by JiJi Bahhur, Director of Regulatory Compliance

From March 10-March 15, 2014, NAFCU held its annual Regulatory Compliance School in National Harbor, Maryland.  In attendance were numerous credit union industry professionals, including compliance officers, CEOs, marketing managers, attorneys, auditors, examiners, vendors and more!

Throughout the week, we had great questions both during and after the sessions.  And in some instances, we caught ourselves having an “uh-huh” moment because the presenter or attendee shared a great point that either clarified something we weren’t so sure about in the past or that put something on our radar.

Today, I’d like to share some of those moments with you:

Great Point #1:  Can the credit union send remittance transfer disclosures – both the prepayment disclosure and the receipt (or combined disclosure) – electronically?  Yes.  If the member requests the remittance transfer electronically, the prepayment disclosure can be sent electronically even where the Electronic Signatures in Global and National Commerce Act (E-SIGN Act) requirements are not met.  However, the receipt (or combined disclosure) may be sent electronically only if the E-SIGN Act requirements are met.

Great Point #2:  A number of our presenters discussed the importance of definitions.  In fact, we heard it a number of times:  “Read the definitions section of the regulation!”  Why?  The definition may be different than what you’re expecting depending on what regulation you’re dealing with.  Unfortunately, definitions are not consistent from regulation to regulation.

Great Point #3:  For open-end (not home-secured) credit, the credit union must provide 45-day advanced notice for changes to any terms required to be disclosed in the account opening disclosures.  On the model form provided by Regulation Z, there is language that states “for more information, see the enclosed booklet.”  If your credit union doesn’t have an enclosed booklet, it’s probably a good idea to remove that language!

Great Point #4:  Under Regulation E, can the credit union require the member to obtain a police report when the member reports a fraudulent transaction(s)?  No.  The credit union can request a police report, but it cannot require a police report.  Also, in a situation where the member provides oral notice of fraud, the credit union can require a member to follow up an oral notice with written notice (CU must inform member of this requirement and provide an address), but the credit union cannot delay its investigation. 

Great Point #5:  With advances in technology, it has become less clear as to where the NCUA advertising logo or official advertising statements are required.  Is it required on ATMs?  How about mobile banking?  Video teller machines?  NCUA has stated that ATMs are exempt from the NCUA logo requirement.  However, it is less clear as to whether the logo or official advertising statement are required for purposes of mobile banking and video teller machines.  It may be time for NCUA to take a look at its advertising rule to address these technological advances. 

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Congratulations to the Class of 2014 - it was truly a pleasure to spend the week dissecting both the existing and future regulations of the credit union industry with so many of you.  Even better, a number of attendees walked away with their NAFCU Certified Compliance Officer (NCCO) designation.  Again, congratulations!  What an accomplishment!  And, here is the Class of 2014 . . .

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Shameless Plug.  NAFCU’s 2014 Credit Union Compliance GPS is available for purchase! This comprehensive, electronic resource translates complex regulatory language into plain English. The latest edition includes an expanded section on Reg E and the Remittance Transfer Rule, 7 new sections on the CFPB’s mortgage rules, improved user-friendly search functions, including more hyperlinks and bookmarks and much more. Get yours today!