Signage and Public Notice Compliance Requirements By Mary

Transcription

A PUBLICATION OF CHARTWELL COMPLIANCE | SPECIAL EDITION ICBA
NOVEMBER 2013
Notice: The Compass is now a quarterly publication to ensure topnotch content for our readers. Thank you for your understanding!
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11
19
Human Trafficking - Look below the Surface,
Hidden in Plain Sight
Kris Welch
Points to Ponder
Regulations, Rules; Interpretations,
Applications
Jill Emerson
21
ICBA HelpDesk
Answering complex compliance-related questions
22
Recent Engagements
24
About Chartwell
Consultants, services, strategic alliances
CHARTWELL COMPASS | ICBA
Signage and Public Notice Compliance
Requirements
By Mary Thorson
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CHARTWELL COMPLIANCE
Signage and Public Notice Compliance
Requirements
By Mary Thorson
It’s a “sign” of compliance. Financial institutions are
buried under disclosure requirements; but none are
more conspicuous as those required to be posted or
made available for public scrutiny. Public signage and
notice requirements run the gamut from loans and
deposits to privacy and the USA PATRIOT Act of 2001.
We’ve gathered a list of federal regulations and laws
requiring public notice or disclosures for a quick
compliance checkup.
Fair Housing Poster
A financial institution engaged in making loans for
the purpose of purchasing, constructing, improving,
repairing, or maintaining a dwelling or any loan secured
by a dwelling must conspicuously display either:
the Equal Housing Lender poster required by the
Fair Housing Act, or
the Equal Housing Opportunity poster prescribed
by the U. S. Department of Housing and Urban
Development's regulations.
The poster must be at least 11 by 14 inches in size
and prominently displayed in a central location in the
bank where deposits are received or where covered loans are
made.
where the institution has offices. The disclosure statement must
be available for a period of five years, and the disclosures for
the prior two calendar years must be maintained in the bank’s
Community Reinvestment Act Public File. An institution must
make the disclosure available for inspection and copying
during the hours the office is normally open to the public for
business and may impose a reasonable fee for any cost
incurred in providing or reproducing it.
Regulation C – Home Mortgage Disclosure Act
Notice and Disclosure
For financial institutions covered by the Home Mortgage
Disclosure Act (“HMDA”), a general notice about the
availability of its HMDA data must be posted in the lobby of its
home office and of each branch office located in a
metropolitan statistical area (“MSA”) and Metropolitan Division.
A covered institution must also make its modified loan/
application register (“LAR”) available to the public for a period
of three years. The loan/application register made available to
the public should be modified to remove the following
information regarding each entry: the application or loan
number, the date that the application was received, and the
date action was taken.
Regulation BB – Community Reinvestment Act
(“CRA”) Public File and Notice
A bank is required to post in the lobby of its main office
and each of its branches a public notice about the availability
of its CRA Public File. Appendix B to Regulation BB provides
example formats for each type of notice to fit the institution
and the location of its offices.
The CRA also requires each financial institution to maintain
public files of specified information. The contents of the CRA
Public File required to be maintained at the main bank office is
more extensive and each bank branch must also maintain a
file with more abbreviated contents.
The HMDA disclosure statement prepared by the FFIEC
must be made available to the public within ten business days
of receiving it, at the main office and in at least one branch
office in each other MSA and each other Metropolitan Division
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Regulation CC requires that financial institutions
provide customers who have a transaction account
with a posted disclosure of the funds availability
policy.
Regulation CC - Expedited Funds Availability Act
Notice
USA PATRIOT Act of 2001 Customer
Identification Program (Bank Secrecy Act)
Regulation CC requires that financial institutions
provide customers who have a transaction account with a
posted disclosure of the funds availability policy. One
common error is a policy disclosure that does not reflect the
actual practices followed by the institution in most cases.
Regulation CC requires that you post the notice of your
availability policy to consumer accounts in locations where
employees accept consumer deposits. The notice must
specifically state the availability periods for the various
types of deposits that may be made to consumer accounts.
It need not be posted at each teller window, but it must be
posted in a place where consumers seeking to make
deposits are likely to see it before making their deposits. The
notice is not required at drive-through teller windows or at
night depository locations, but it is required at all
automated teller machines.
Section 326 of the USA PATRIOT Act of 2001 requires
adequate customer notice of the financial institution’s
Customer Identification Program (“CIP”). The CIP must
include procedures for providing customers with adequate
notice that the bank is requesting information to verify their
identities. The notice must generally describe the bank’s
identification requirements and be provided in a manner
that is reasonably designed to allow a customer to view it or
otherwise receive the notice before the account is opened.
Examples that meet the requirement include posting the
notice in the lobby, on an Internet website, or within loan
application documents. The notice can be given verbally,
or posted or printed on documents.
1Under Section 343 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), temporary unlimited deposit insurance coverage for noninterest-bearing
transaction accounts (NIBTAs), including Interest on Lawyer Trust Accounts, was scheduled to expire on December 31, 2012. Absent a change in law, beginning January 1, 2013,
the FDIC no longer provided separate, unlimited deposit insurance coverage for NIBTAs at insured depository institutions (IDIs). IDIs were encouraged to take reasonable steps to
provide adequate advance notice to NIBTA depositors of the changes in FDIC insurance coverage so that they may consider the impact of any change in coverage in their
management of these transaction accounts. On November 5, 2012, the FDIC issued FIL-45-2012 Notice of Expiration: Temporary Unlimited Coverage for Noninterest-Bearing
Transaction Accounts.
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FDIC Insurance Disclosure and Advertisement of
Membership
To minimize customer
confusion with deposit
products, sales or
recommendations of
nondeposit investment
products on the
premises of a depository
institution should be
conducted in a physical
location distinct from
the area where retail
deposits are taken.
Part 328 of the FDIC Rules requires the display of the
official FDIC sign. Each insured depository institution must
continuously display the official sign at each station or
window where insured deposits are usually and normally
received in the depository institution's principal place of
business and in all its branches. The official sign must be 7" by
3" in size, with black lettering and gold background. The
official sign includes the dollar limit prescribed for FDIC
insurance coverage for each depositor.
Nondeposit Investment Products
Many insured depository institutions have expanded
their activities in recommending or selling to retail customers
nondeposit investment products, such as mutual funds and
annuities. Depository institutions commonly offer these
products at the retail level, directly or through various types
of arrangements with third parties. Because the products are
not FDIC-insured, where nondeposit investment products are
recommended or sold to retail customers, depository
institutions should ensure that customers are fully informed
that the products:
are not insured by the FDIC;
are not deposits or other obligations of the institution
and are not guaranteed by the institution; and,
are subject to investment risks, including possible loss
of the principal invested.
To minimize customer confusion with deposit products,
sales or recommendations of nondeposit investment
products on the premises of a depository institution should
be conducted in a physical location distinct from the area
where retail deposits are taken. Signs or other means should
be used to distinguish the investment sales area from the
retail deposit-taking area of the institution.
Financial Disclosure Notice
Financial institutions must at all times display a notice
that the annual financial disclosure statement may be
obtained from the bank. The notice is required to be
displayed in the lobby of the main office and each branch.
It must include, at a minimum, an address and telephone
number to which requests should be directed. The first copy
of the annual financial disclosure statement must be
provided to a requester free of charge.
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Human Trafficking
Look Below the Surface, Hidden in Plain Sight
By Kris Welch
We have all heard stories and seen movies on human
trafficking, depicting young women forced into underground sex
trafficking, kept on drugs and forced to prostitute for money.
Have you ever thought that this may be happening in your
neighborhood?
The term “human trafficking” triggers different definitions for
different people. Sex trafficking has received more coverage in
the media than forced labor, so people generally think of this
first. The verb traffic means to trade or to barter. Yet trade in
humans does not necessarily involve movement, and
international definitions of human trafficking are evolving to
reflect this.
People of any age and gender are vulnerable to becoming
victims of human trafficking. In May 2013, The United Nations
Reported that 2.4 million people across the globe are victims of
human trafficking at any one time:
80% are being exploited as sexual slaves
50% are children
17% are exploited as forced labor
$32 billion are earned every year by criminals running
human trafficking networks
$90 is the average cost of one human
Two out of every three victims are female
Odds of rescue are one in one hundred
Human trafficking varies by type and also by “current”, which is
the flow of victims. These currents include the source nation, the
transit nation and the destination nation. One current of trafficking
that is often overlooked is internal or domestic, involving indentured
servitude within the country. The main focus has been on victims of
international trafficking, but domestic trafficking is often overlooked
and is far more common.
Trafficking can occur in many licit and illicit industries or markets,
including in brothels, massage parlors, street prostitution, hotel
services, hospitality, agriculture, manufacturing, janitorial services,
construction, health and elder care, and domestic service.
Individuals who entered the United States without legal status have
been identified as trafficking victims, as have participants in visa
programs for temporary workers who fill labor needs in many of the
industries described above.
There are common methods used by traffickers, regardless of
the type of trafficking, such as, false job offers which lure potential
victims and demanding exorbitant fees charged for recruitment,
visas, travel, housing, food and the use of tools. These practices
keep victims in an endless cycle of debt. Many times, traffickers
charge victims fines for alleged poor behavior or not meeting
certain work quotas. As these debts rise, the victims often go
underpaid or unpaid. To control and limit the movement of victims,
traffickers frequently withhold victim’s visas and other identification,
isolate the victims or their families, and physically harm the victims.
At the outset, the victims may owe a large amount of money relat-
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to recruiting fees. In order to pay these fees, workers sell their
land, the land of family members or take loans with
astronomical interest rates. While earning low wages, or no
wage, and paying high fees for housing, food, and even the
use of tools, the workers are unable to repay their debts,
putting them in a position of debt bondage. In cases where
the employer has paid the costs upfront, the worker is
required to work of their debt before they receive any wages.
ancestors; others may fall victim to traffickers or recruiters who, as
a term of employment, exploit an initial debt.
Involuntary Domestic Servitude – This involves informal work in a
private residence. Domestic workplaces are informal, connected
to off-duty living quarters and often not shared with other
workers.
While earning low wages, or no wage, and
paying high fees for housing, food, and
even the use of tools, the workers are
unable to repay their debts, putting them in
a position of debt bondage.
What is the distinction between “trafficking in persons” and
“human trafficking”? Both are used as umbrella terms for the
act of recruiting, harboring, transporting, providing, or
obtaining a person for compelled labor or commercial sex
acts through the use of force, fraud, or coercion.
The
Trafficking Victims Protection Act (TVPA) of 2000 (Pub. L
106-386), as amended, and the Palermo Protocol, describe
the compelled service using a number of different terms,
including involuntary servitude, slavery or practices similar to
slavery, debt bondage, and forced labor. Human trafficking
may include movement, but does not require it.
What are some attributes that may contribute to
making a victim vulnerable to trafficking?
Poverty and economic hardship (including run-aways)
Demand for cheap labor
Natural disasters
Sex Trafficking - When an adult is forced, coerced, or
deceived into prostitution. Sex trafficking also may occur
within debt bondage.
Forced Labor – Sometimes referred to as labor trafficking,
covers a wide range of activities such as recruiting, harboring,
or transporting. Migrants are particularly vulnerable to this
form of trafficking, but one could also be forced into labor in
their own country. Female victims in domestic servitude are
often sexually exploited under forced labor.
Bonded Labor or Debt Bondage – Bond and debt is one form
of coercion. Some workers may even inherit debt from their
This modern type of slavery, has
replaced whips and chains with
economic intimidation.
The United States is one of the top ten
destinations for human trafficking, with
reportedly, tens of thousands of victims
brought into the country each year.
Sex trafficking is the most common
form of human trafficking identified
among U.S. citizens. The common misconception among
Americans is that human trafficking within the States is an
underground industry, where victims and abusers are exclusively
immigrants, when in fact, U.S. citizens and legal residents, may
also become victims.
There are many faces of “Modern Slavery”:
Child Sex Trafficking – When a child (under 18 years of age) is
induced to perform a commercial sex act, involving force,
fraud, or coercion.
Forced Child Labor – A child may be a
victim of human trafficking regardless
of their location. The child may appear
to be in the custody of a non-family
member, who requires the child to
perform work that financially benefits
someone outside of the child’s family,
and who does not offer the child the
option of leaving.
Immigration status
Criminal activity
Political instability
The U.S. State Department releases an annual “Trafficking in
Persons (TIP)” report, each May, which tracks the progress in the
fight against human trafficking. The report ranks 184 countries by
Tier Placement based on their level of compliance with human
trafficking laws:
Tier 1 – Fully comply with the minimum standards
Tier 2 – Do not meet the minimum standards, but are making
significant efforts
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Tier 2 Watch List – Do not meet the minimum
standards, are making significant efforts, but have
significant level of concerns.
Immigration attorneys and labor intermediaries are
Industries and businesses easily exploitable by
traffickers;
High volume of debit card/credit card transactions
using specific merchant codes;
Excessive hotel charges and high percentages of
purchases made at casinos, high-end merchants, etc.;
The United States is rated as Tier 1. To
review the full report and a list of
countries, please visit:
Airline, rental car, bus or taxi charges in multiple states
and cities;
Payments to Web advertisers that cater to the sex
industry;
Wire transfer activity with customer’s business;
http://www.state.gov/documents/organization/210737.pdf
Wires to and from countries that are inconsistent with
the customer’s known profile; and
Extensive purchases of money orders.
Tier 3 – Do not comply and are not making efforts
For financial institutions, it is important for your staff to
be: trained in identifying and reporting human trafficking
(SAR filing); legally empowered; and given incentives in
identifying potential victims.
If your front line staff suspects a customer may be
a victim of human trafficking, potential questions to
ask may be:
What type of work do you do?
Could you quit your job if you wanted to?
Some Human Trafficking Possible Indicators
and /Red Flags are:
Are you getting paid for the work you do?
Is there anything being withheld from your pay?
The victim may be accompanied to conduct
business by a controlling person or boss who does
not allow the victim to speak on his or her own
behalf;
Can you come and go from home/work at your
leisure?
Are you afraid to leave your current place of
employment?
The victims may have lack of control over their
personal identification, travel documents, money or
schedule;
Has your identification been taken from you?
The victim may be transported to or from work and
may live and work in the same place;
Debts may be owed to an employer/leader, and
the victim does not have the ability to leave the
job;
Victims may have bruises, exhibit depression, and
are overly submissive and fearful;
Customer transaction histories that include a high
volume of round-dollar deposits, wires, ACH or cash;
Interstate cash deposits, deposited at several
branches and just below the reporting thresholds;
Customers with an excessive number of accounts;
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In your community your institution may also partner
with the following individuals, agencies, and organizations
where human trafficking may occur:
Government officials who inspect or have access to
establishments accessible to trafficking (labor
inspectors, port inspectors, factory inspectors, food
industry inspectors, agricultural inspectors, housing
inspectors, postal workers and tax authorities).
Private sector employees who may encounter
trafficking in their workplace (employees of hotels,
restaurants, bars, beauty salons and grocery
stores.).
Religious leaders
Organizations that work with immigrants, children, the
homeless, refugees, and runaway youth.
The U.S. Department of Homeland Security (DHS) is
responsible for investigating human trafficking, arresting
traffickers and protecting victims. DHS initiates hundreds of
investigations and makes numerous arrests every year, using a
victim-centered approach. DHS also processes immigration
relief through Continued Presence (CP) and issues visas to
victims of human trafficking and other designated crimes.
Identifying and reporting human trafficking is everyone’s
responsibility.
Law enforcement officers (police, immigration
officers and border guards).
Health care professionals (emergency room
personnel, health clinics, doctors, nurses, dentists,
OB/GYNs, practitioners at family planning clinics
and HIV/AIDS clinics).
Transportation professionals (truck, taxi and bus
drivers, train attendants, flight attendants and
employees at truck and rest stops).
Education officials (principals, guidance counselors,
teachers and school nurses).
Kris Welch, CRCM, CAMS is a long time
banker and financial services consultant with
over 25 years experience in regulatory
compliance, risk assessments, financial
institution branch management, and real estate appraisal.
She has established, coordinated and maintained effective
financial institution compliance and reporting programs. Read
full bio.
Please report suspected human trafficking activity to law enforcement
(available 24/7, in over 300 languages and dialects) by:
The Department of Homeland Security provides some excellent
resources, which may be utilized as training for your staff to
assist in identifying and reporting suspected cases of human
trafficking.
Calling
1-866-347-2423 (toll free)
1-802-872-6199 (non toll free
international)
Additional Resources
U.S. Department of State
Immigration and Customs Enforcement
Reporting Online
United Nations Office on Drugs and Crime
www.ice.gov/tips
Federal Bureau of Investigation
Financial Action Task Force (FATF)
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Recent Action Items –
Final and Interim
Regulations and
Rules, Interpretations,
and Applications
Armored Car Ruling
Compliance Deadline:
September 30th
Consumer Financial
Protection Bureau (CFPB)
published for comment in
the Federal Register
interim final Rules of
Practice for Issuance of
Temporary Cease-andDesist Orders (TCDOs) the
CFPB may issue under
section 1053(c) of the
Dodd-Frank Act.
CFPB published its
previously-announced
final rule amending
Regulations B, X and Z
On the Radar –
Proposed
Regulations and
Rules
$160M Civil Money
Penalties from FRB for
Residential Mortgage
Practices
Agencies to BiggertWaters Flood Rule
Changes
FRB Issues AML/BSA
Consent C&D Order
Large Institutions Liquidity
OCC Flood Enforcement
Action against an Indiana
bank
Rule Proposed
Liquidity Risk Management
Rule Proposed
FDIC Annual Stress-Test
Template and
Documentation Released
Watch this Space –
Emerging Regulatory
Concerns
Regulators Issue QM Fair
Lending Risk Guidance
Joint Standards for
Assessing Diversity Policies
and Practices
NCUA Cease and Desist
Order Issued
FDIC Issues Civil Money
Penalties for Regulation B
organizations
FDIC Issues Civil Money
Penalty for Flood Violations
NCAU Board approved
final rules requiring all
federally insured credit
unions to plan for liquidity
events
CFPB Orders HMDA
Penalties
HUD Publishes QM
Proposal for Insured and
Guaranteed Loans
The OCC and FRB revised
their risk-based and
leverage capital
requirements for banking
CFPB Updates Mortgage
Servicing Rules
FFIEC Alert: Microsoft is
discontinuing support for
Windows XP in 2014
OCC & FDIC Interagency
TDR Guidance Released
Violations
US & Mexico sign MOU to
exchange financial
information to combat
drug crime
CFPB released a report
detailing how the Credit
Card Accountability
Responsibility and
Disclosure Act of 2009
(CARD Act) reduced
penalty fees
CFPB Publishes Trial
Disclosures Policy
OCC Risk Management
Guidance Bulletin Issued
Unauthorized Banking
Alert - AmTrade
International Bank
Department of the
Treasury issued the first
annual report of its State
Small Business Credit
Initiative (SSBCI)
Residential Home Sales Up
O&G Activity Promotes
Community Bank Growth
National Credit Union
Administration posted its
September 2013
economic outlook video
on YouTube
OCC Reports Continued
Improvement in Mortgage
Performance
FTC Files Amicus Brief
Supporting Class Action
Suit that Challenges
Payday Lender’s
Arbitration Practices
NCUA Issues Prohibition
Orders
FinCEN made available an
updated version of the
Discrete (online) Report of
Foreign Bank and
Financial Accounts (FBAR)
FRB Community Affairs
Letters Published
CFPB issues $1.376M Civil
Money Penalty
Other Industry Issues
of Interest
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Unauthorized Banking
Alert - AmTrade
International Bank
Midwestern
Community Banks
Performance Improves
FRFS announces new
FedReturn image cash
letter deposit deadline
Updates to FedACH
Circular
Redesigned $100 Note
Issued
Fed to Update
Compliance Exams
Warning about
Increase in D&O
Liability Policies
Exclusions
NCUA Updates Spanish
Version of Websites
New toll-free number
announced for the
NMLS Call Center (855NMLS-123 or
NCUA announces
approval of the first
new federal credit
union charter of 2013
855-665-7123)
CFPB Announces New
eRegulations Tool
NCUA made available
a new video, "March in
Double Time with
OSCUI," which
highlights the training
programs for small and
low-income credit
unions
FTC Action Stops
Collection of Fake
Payday Debts
Regulation E
Remittance Transfers
Rule takes effect, CFPB
announces news
release to those who
send money abroad
about the protection it
offers
Financial Action Task
Force (FATF) issued a
public statement and a
report on its on-going
process for improving
FRB MakesWritten
Agreement With
Pakistani Bank
global anti-money
laundering and
combating the
financing of terrorism
CFPB Releases
“Managing Someone
Else's Money” Guides
Regulators Issue 2013
Securities Classification
Guidance
Treasury/IRS Offshore
Tax Evasion Notice
FDIC Money Smart
Podcast Network
Website Updated
Central Banks Make
Permanent Swap
Arrangements
FinCEN Issues
Information Sharing
Fact Sheet
Federal Reserve
Services 2014 Fee
Schedule Approved
Federal Reserve Board (“FRB”) to Update Compliance Exams
On October 10, 2013 in a speech at the recent Federal Reserve/Conference of State Bank Supervisors Community
Banking Research Conference in St. Louis, Federal Reserve Governor Jerome Powell mentioned that the Federal
Reserve has undertaken a review of its consumer compliance supervision program for community banks. As noted
during the speech, examiners have traditionally applied a risk-driven approach to supervision. The Fed recognized a
need to provide more specific guidance to examiners. Starting in 2014 FRB examiners will base exam intensity
more explicitly on an individual bank's risk profile, including its compliance culture and how effectively it identified
and manages consumer compliance risk.
Please see the full text on the Federal Reserve website for more details.
10
In a recent survey, more than 80% of ICBA members reported that
compliance issues are their biggest challenge. As one member said,
compliance takes the fun and profitability out of banking. The ICBA
Compliance HelpDesk addresses this need by helping banks preserve fee
revenue, contain administrative expenses, and launch new products, all
while staying compliant and profitable during regulatory turmoil.
The ICBA Compliance HelpDesk offers bankers an added layer of ondemand manpower and expertise to answer complicated compliancerelated questions. Our experts, who provide a practical, hands-on, realworld understanding of compliance, each possess an average of 30 years
of experience as bankers, regulators, and law enforcement officials.
All-Purpose Support Provided by Compliance Experts
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chartwellcompliance.com/icbahelpdesk,
email info@chartwellcompliance.com, or
call: 1.800.541.6744.
Review or drafting of compliance policies and procedures based
on the latest regulations
Review of disclosures, advertisements, website pages and new
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Participation in compliance committee meetings
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Review or creation of compliance and BSA/AML risk assessment
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Webinar or in-person training on compliance and BSA/AML
matters
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Assistance with regulatory relationships and examinations
Assistance with enforcement actions and corrective actions
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and other deals
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Monthly e-report that tracks, reports and analyzes how to comply
with new regulations
Annual compliance e-calendar marking regulatory milestones,
Subscription to our regulatory compliance review, Chartwell
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11
Consumer Compliance
Chartwell has recently executed a number of bank consumer
compliance program reviews, a very important area as federal
regulators intensify their scrutiny of loan and deposit activities. Our
bank compliance testings, led by consultants with over a quarter
century of regulatory experience, have covered the following
regulations:
Regulation B: Equal Credit Opportunity Act
Regulation C: Home Mortgage Disclosure Act
Regulation D: Reserve Requirements for Financial Institutions
Regulation E: Electronic Fund Transfers Act
Regulation G: S.A.F.E. Mortgage Licensing Act
Regulation H: Flood Insurance
Regulation M: Consumer Leasing Act
Regulation N: Mortgage Acts and Practices-Advertising
Regulation O: Extensions of Credit to Insiders
Regulation P: Privacy of Consumer Financial Information
Regulation V: Fair Credit Reporting Act
Regulation X: Real Estate Settlement Procedures Act
Regulation Z: Truth in Lending Act
BSA/AML
Regulation AA: Unfair or Deceptive Acts or Practices Act
Regulation BB: Community Reinvestment Act
An international payments processor sought a
consultant to assist with a broad range of BSA/AML
compliance matters in conjunction with the launch
of a new person-to-person money transfer product
platform that will be sold to financial institutions. To
start the project, Chartwell was assigned to design
a BSA/AML compliance program with detailed
policies and procedures, after gaining an
understanding of the company’s business model.
Chartwell then provided written BSA/ AML training
course material. We assigned a consultant with
nearly 30 years of experience in financial services
compliance and exceptional background in
payments and money services businesses.
Regulation CC: Expedited Funds Availability Act
Regulation DD: Truth in Savings Act
Regulation GG: Prohibitions on Internet Gambling
Fair and Accurate Credit Transactions Act (FACTA)
Unfair, Deceptive or Abusive Acts or Practices Act (UDAAP)
Fair Debt Collection Practices Act (FDCPA)
Home Ownership Counseling
Mortgage Disclosure Improvement Act (MDIA)
Mortgage Loan Officer Compensation
Right to Financial Privacy Act (RTFPA)
Servicemembers Civil Relief Act (SCRA)
FDIC Deposit Insurance Disclosures
Advertising, Public Notices, and Signage
Representative Engagements
A national bank’s retail payments arm hired Chartwell to establish a formalized control framework that includes an industry
standard Risk Control Self Assessment (“RCSA”) process. This initiative has provided the customer with the infrastructure and tools
to migrate to a standardized enterprise process for identifying, assessing, controlling, and reporting all of the risks in the business.
We are helping to design control improvement plans for processes with unacceptable residual risk/control deficiencies, as well
as assist with the design of simplified and standardized control process flows for complex and disparate practices. Chartwell may
also train the bank’s internal resources in facilitation and serve as the facilitators for the first RCSA cycle. Our consultants have
extensive backgrounds in RCSA facilitation, banking operations, credit cards, audit, compliance, technology and credit.
12
State Money Transmitter License Applications
Chartwell completed applications for state money transmitter
licenses in 47 states and three U.S. jurisdictions on behalf of a
publicly traded customer. The project was successfully
completed within an incredibly fast six-month period and
almost exactly within the initially estimated budget. Part of the
reason the organization chose us is due to our unique software
and methodology capabilities to manage a project of
complex initiatives. Our project leaders were also veterans of
state licensing and money services businesses, having welldeveloped relationships with personnel throughout the state
regulatory agencies.
Interest Rate Risk
Chartwell assisted a strategic partner with conducting an
assessment of interest rate risk (“IRR”) metric selection and
application for a large national bank, providing our written and
verbal opinions on gaps relative to both better practices and
regulatory requirements, as well as our insights on data,
analytics and measures, governance processes, and reporting
to refine the financial institution’s overall IRR measurement
capability. We assigned a former senior bank safety and
soundness examiner with approximately a quarter century
experience in multiple federal regulatory agencies.
Transfer of Control
Chartwell’s Daniel Weiss assisted a financial services software
business with identifying the regulatory requirements
associated with acquiring control of a licensed money
transmitter. The work included providing guidance on
sequencing and structuring the deal in relation to the
regulatory process; communicating and sounding off ideas
with regulators; providing non-legal guidance during regulatory
strategy sessions with company executives and counsel;
identifying and assisting with applications for approval and
better defining requirements in states which do not have
specific rules; providing suggested talking points for use with
regulators; providing suggestions on notifying the surety bond
broker, Secretaries of State and banks concerning the material
event.
International Correspondent Banking
Chartwell recently assigned five individuals to be separately
interviewed by a client organization for their views on the
regulatory compliance requirements affecting U.S.-Mexico
correspondent banking relationships. Our interviewees include
Dennis Lormel (former FBI Financial Crimes Section Chief); Allan
Schott (former OCC Chief Counsel); Bob Pasley (former OCC
Assistant Director of Enforcement and Compliance); James
Wright (former OCC examiner); and Kris Welch (former bank
compliance officer). Each of these individuals have extensive
resumes of working with international organizations or overseas.
All-Purpose Compliance Assistance
Chartwell’s HelpDesk product, launched in January 2013,
provides all-purpose, customized compliance assistance on
demand to subscribers for a fixed, reasonably priced annual
fee, with a special discount for ICBA members. Please learn
more about HelpDesk in this edition of Compass or on our
website. http://chartwellcompliance.com.
Conducting a 130-Country AML Risk Assessment
for a Federal government Agency
Chartwell recently conducted a 130-country Anti-Money
Laundering risk assessment for a federal government agency
preparing to launch an international financial product. The
scope of the engagement included the creation of a
comprehensive assessment matrix; provision of narrative
explanations of rankings and full reproducible methodology;
procedures for the client to perform future iterations as
necessary for additional countries; and an executive summary
for the client’s internal stakeholders. Chartwell identified the
relevant subject matter and utilized a small team of
professionals with over 90 years’ combined AML, money
transmission, financial services and project management
experience.
Serving as outsourced BSA and State MSB
Licensing Administrator
An international money services business sought a consultant
to assist with a broad range of BSA/AML compliance and state
licensing matters in the U.S. that have included: serving as
outsourced BSA/AML compliance administrator; applying for
and serving a project manager role for state money transmitter
license applications; providing compliance policies and
procedures; conducting compliance training; providing nonlegal opinions on the applicability of state money transmitter
licensure and money services businesses registration with
FinCEN; and producing a handbook of state money transmitter
requirements. These services have been needed in conjunction
with the launch of the company’s business in the U.S. As this
client’s needs have evolved, we have assigned a team of
consultants with a combined 190 years of experience in
financial services compliance and exceptional background in
payments and money services businesses.
13
“There are several
potential ‘traps’ in
navigating BSA
compliance and the
State licensing
process to which
Chartwell has helped
our company navigate
it all in order to put us
in the best position to
capitalize on our
investment in the
shortest time frame
possible."
Alex Eadie
Executive Vice President,
Operations & Compliance
FIRMA Foreign Exchange
Corporation
Chartwell Compliance offers all-in-one integrated regulatory compliance and
risk management consulting, testing, audit and examinations, and
outsourcing services. We serve bank and non-bank financial service
providers in North America, Western Europe and other FATF-member
countries that are striving to do business successfully in the midst of
unprecedented regulatory upheaval.
Chartwell Compliance is attuned to emerging trends, new regulations and rules, and issues
relating to the financial services industry. Our consultants believe every client is critically important;
and, along with high service delivery standards, coupled with a smaller firm’s pricing, allow Chartwell
to deliver a value unmatched in the marketplace.
The people of Chartwell have a practical, real-world understanding of regulatory compliance,
enterprise risk management, and financial crimes. Chartwell consultants have gained their real-world
understanding through numerous years of work as regulators, law enforcement officials, and operators
in the financial industry. This allows us to translate compliance in practical ways helping our clients
maintain fee revenue; lower operating costs, and proactively anticipate the desires and requirements
of a diverse range of agencies and regulators in charge of supervising financial institutions.
Chartwell Compliance, as an all-in-one consulting firm, allows our clients to avoid the burden of
managing multiple vendor relationships, making it possible for our clients to realize economies of
scale. In addition, our clients gain further value from having a partner with experience and expertise
encompassing compliance, risk, and corporate planning. Our consultants are passionate about their
areas of expertise and equally comfortable as testers, trainers, or mentors to our clients.
Value Propositions
Chartwell Consultants
One of the best AML/CFT, Financial Crimes and state license
consultancies in the world
One of the world’s best MSB and emerging payments compliance
consulting firms
Very well-rounded practitioners experience
Better reputation, pricing and value than the Big 4 and Promontory
Significantly lower cost, more services, and more practitioners
experience than law firms
Entrepreneurial and highly responsive
End-to-end services and outsourcing
Free quarterly technical publication, Chartwell Compass, distributed to
45,000 individuals
Strong human and software project administration backbone to keep
on time and on budget.
14
Our team is cross-certified in regulatory
compliance, anti-money laundering, testing,
information technology and security, and fraud. The
diversified experience of our consultants provides our
clients with access to experienced examiners,
operators, and regulatory policy makers in both the
banking and non-banking segments of the financial
services market, including some of the most talented
and seasoned professionals in emerging payments
compliance.
This vast, multi-disciplinary experience allows us to
help our clients design and implement compliance and
risk management programs and practices properly
calibrated to address both the current and prospective
regulatory environment in an effective manner. As a
result, our clients’ products and services can be
launched more quickly and remain appropriately
priced, usable, compliant, and of high value to endusers.
The average experience of our consultants is
twenty-five (25) years. Our group includes some of the
i n d u s t r y ’ s f o re m o s t a u t h o r i t i e s o n re g u l a t o r y
compliance, information security, licensing, and fraud
such as:
Long-standing relationships between team
members
Former federal and state examiners of MSBs and
banks
Former employees of MSBs such as Western Union,
First Data, PreCash and Microfinance International
Corporation
Former employees of banks such as Wells Fargo,
Westpac, Bank of America, CapitalOne, and many
community banks
Former OCC Chief Counsel and Asst. Director of
Enforcement
Former FBI Financial Crimes & Terrorist Financing Ops
Chief
Former Federal Reserve System Managing Examiner
Former AUSTRAC Adviser and Payments Manager
for Reserve Bank of Australia & Monetary Authority
of Singapore
Services
REGULATORY COMPLIANCE Chartwell Compliance provides consulting across
nearly the entire range of rules and regulations affecting bank and non-bank
financial institutions. Our regulatory subject matter expertise includes but is
not limited to: Enforcement action solutions; Bank Secrecy Act (“BSA”);
Office of Foreign Assets Control (“OFAC”); Loan Compliance (commercial,
consumer, real estate); Deposit Compliance, Home Mortgage Disclosure Act
(“HMDA”); Secure and Fair Enforcement for Mortgage Licensing Act
(“SAFE”); Unfair, Deceptive or Abusive Acts or Practices Act (“UDAAP“); social
media; capital requirements; Community Reinvestment Act (“CRA”); state
and federal regulations for money services businesses, stored value, and
payment systems.
BSA/OFAC, AML, FRAUD & CORRUPTION Chartwell Compliance brings together
some of the country’s most prominent authorities in Anti- Money Laundering
and Combating the Financing of Terrorism (“AML/ CFT”) financial crimes and
fraud prevention. Chartwell Compliance’s proficiencies include: Counter
terrorism financing; anti-money laundering; asset forfeiture and recovery;
fraud prevention (corporate and mortgage); Foreign Corrupt Practices Act
and the UK Bribery Act; forensic accounting; foreign government advisory on
AML/CFT regulatory regimes. Chartwell Compliance provides a wide variety
of related services including: Training and seminars; enforcement action
solutions; comprehensive look back reviews; policy and procedure
development; independent reviews; risk assessments; investigations and due
diligence, expert witness services; and non-legal opinions.
STATE MONEY SERVICES BUSINESS LICENSING Chartwell Compliance assists
money services businesses such as prepaid access providers, currency
exchangers, check-cashing companies, e-wallet service providers, and
mobile technology companies in applying for and maintaining state
licensure requirements. We offer first-hand experience, reasonable non-legal
pricing and additional value in being able to assist clients with related areas
such as AML compliance and corporate planning. Chartwell Compliance
provides services tailored to fit the specific needs of each MSB including:
preparation and submission of state license applications: FinCEN/FINTRAC
registrations; administration of existing state license portfolios including
renewals, periodic reporting, and other requirements; assistance with state
regulatory exams and related remedial work; and non-legal regulatory
opinion relative to licensing and regulatory requirements.
DUE DILIGENCE AND INVESTIGATIONS The team of former senior law
enforcement and regulatory officials and private sector executives of
Chartwell Compliance permits Chartwell to undertake due diligence and
investigation activities in a range of areas in the U.S. and overseas. We also
offer assistance to institutional investors and other companies conducting
corporate due diligence on investment, merger, and acquisition targets.
OPERATIONS & GOVERNANCE Many Chartwell Compliance consultants have
experience in corporate operations, planning and leadership. Chartwell
Compliance provides consulting services in all of these areas, as well as,
providing clients with services such as: Assessments and recommendations;
enterprise wide risk assessments; key indicator dashboards; policies and
procedures; employee training; board of directors training, and other
services.
15
Strategic Alliances
Chartwell Compliance welcomes relationships that deepen the value provided to
our mutual customers. In particular, Chartwell Compliance has a select number of
strategic partnerships with leading service and software providers in the financial
sector seeking a trusted source for referrals, thought leadership and feedback on new
products from the perspective of regulators, law enforcement officials and former
practitioners. Some of our alliances include:
Fiserv, Inc. (NASDAQ: FISV) is the leading global
provider of information management and electronic
commerce systems for the financial services industry.
The Independent Community Bankers of America,
represents nearly 5,000 community banks of all sizes
and charter types throughout the United States.
BankersEdge is the online training partner of choice for
hundreds of financial institutions nationwide, with a
library of over 300 courses that span regulatory
compliance, financial skills and professional
development.
Bankers’ Bank of the West provides high-quality
products and services as well as deep industry
expertise to more than 300 community bank clients in
the western states and Great Plains region.
Thomson Reuters is the world's leading source of
intelligent information for businesses and professionals.
Resellers
Owned by Reed Elsevier, Accuity is part of BankersAccuity, the
global standard for payment efficiency and compliance
solutions. Accuity is a leading provider of global payment
routing data, AML screening data and software and
professional services that allow organizations, across multiple
industries, to maximize efficiency and facilitate compliance of
their transactions. Accuity maintains authoritative and
comprehensive databases globally with a reputation built on the accuracy and
quality of our data, products and services.
16

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