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On October 18, the OCC released a list of recent enforcement actions taken against national banks, federal savings associations, and individuals currently and formerly affiliated with such entities. The new enforcement actions include civil money penalty orders, prompt corrective action directives, removal and prohibition orders, and terminations of existing enforcement actions against individuals and banks. Included among the actions is a $100,000 civil money penalty issued against a Louisiana-based bank for an alleged pattern or practice of violations of the Flood Disaster Protection Act and its implementing regulations. The list also includes a $30 million consent order issued against a national bank for allegedly violating the statutory holding period for other real estate owned (previously covered by InfoBytes here).
On October 22, the OCC published a final rule to clarify and streamline its other real estate owned (OREO) regulations for supervised national banks and to update the regulatory framework for OREO activities at federal savings associations. The final rule—which is being adopted substantially as proposed in the OCC’s notice of proposed rulemaking issued in April (covered by InfoBytes here)—is the first significant revision to OREO regulations in more than 20 years. As noted in the final rule, pursuant to the Dodd-Frank Act, the OCC now supervises federal savings associations. The framework adopted by the final rule is consistent with the Office of Thrift Supervision’s framework formerly in place, and “offers flexibility consistent with provisions in the Home Owners' Loan Act.”
Specifically, the final rule addresses (i) OREO holding periods; (ii) the methods for disposing of OREO; (iii) OREO appraisal requirements; and (iv) permissible OREO expenditures and notification requirements. The final rule also removes outdated capital rules for national banks and federal savings associations, which include provisions related to OREO, and makes conforming technical edits to other rules that reference those capital rules. The final rule takes effect December 1.
On October 11, the OCC announced that a national bank has agreed to pay a $30 million civil money penalty to resolve allegations relating to the holding period of other real estate owned (OREO). According to the OCC’s consent order, the bank violated the statutory holding period for OREO. (See previous InfoBytes coverage on OCC OREO regulations here.) The OCC asserted that the bank’s processes and controls for identifying and monitoring the OREO holding period were deficient, and following an investigation it determined the bank allegedly “failed to meet its commitment to implement corrective actions, resulting in additional violations.” While the OCC noted that it will continue to monitor the bank’s corrective actions, it determined that the bank’s implementation of effective policies and procedures to ensure OREO compliance over the last 12 months has “significantly reduced its inventory of OREO assets.”
- Sherry-Maria Safchuk to speak on the "California Consumer Privacy Act (CCPA) Workshop" panel at the California Mortgage Banker's 2019 Legal Issues & Regulatory Compliance Conference
- Jon David D. Langlois to discuss "Legal and operational considerations" at the Mortgage Bankers Association's Whole Loan Trading Workshop
- Daniel P. Stipano to discuss “Connecting the dots on your CDD program” at the ABA/ABA Financial Crimes Enforcement Conference
- Daniel P. Stipano to discuss “Beneficial Ownership: You have questions – We have quick answers” at the ABA/ABA Financial Crimes Enforcement Conference
- Daniel P. Stipano to discuss "Risk management in enforcement actions: Managing risk or micromanaging it" at an American Bar Association webinar
- Kari K. Hall and Christopher M. Walczyszyn to speak on the "Understanding updates to Regulation CC to ensure effective check processing" at a National Association of Federal Credit Unions webinar