BSA CMP; Flood Lapse; NCUA OIG Report; NCUA Report
Posted by Anthony Demangone
Here are a few things that were kicking around my inbox.
- The OTS issued a $5 million civil money penalty against Pamrapo Savings Bank, SLA, (New Jersey)Â for alleged Bank Secrecy Act violations. Â Is this a huge, international bank? Â It doesn't seem so. Â It has 87 employees, and just under $600 million in assets. Â The OTS agreement linked above doesn't say much about what they allegedly did wrong. Â Perhaps the biggest lesson here is that you don't have to be massive to get a massive fine when it comes to BSA.
- Congress has allowed the National Flood Insurance Program to lapse again.Â
FEMA issued this letter last month to warn us that Congress was close to letting the National Flood Insurance Program lapse. The letter includes a link to "guidelines" that FEMA created to address what happens in such "lapse" situations.Â
- NCUA's Office of Inspector General issued a "material loss review" concerning the failure of High Desert Federal Credit Union.  The OIG office wanted to determine what led to the failure and to grade NCUA's supervision of the credit union.  The report found that NCUA examiners did not adequately evaluate the risk of the credit union real estate construction portfolio. In addition, NCUA failed to adequately ensure that the credit union addressed issues repeatedly highlighted on DORs.  Finally, the report found that NCUA failed to adequately monitor waivers given to the credit union.  The report covered additional ground, so please give it a read.  My gut tells me that NCUA will be more likely to play hardball with credit unions that fail to address NCUA concerns about member business loans in the future.  No one likes to be called out in a report.Â
- The March NCUA Report has a nice little article on interest rate risk.   NCUA does not throw stuff into these newsletters for no reason.  If they write about interest rate risk, they believe that many credit unions need the information. Hint hint.Â