1. society
2. crime
3. property crime
4. fraud

compass
MAY 2014
A Publication of ChArtwell COMPLIANCE | chartwellcompliance.com Chartwell Compliance provides a one-stop shop
of consulting, testing and outsourcing services
in the areas of regulatory compliance, state
MSB licensing, financial crimes prevention and
enterprise risk management.
2
How to Investigate a Good Fraudster
Dennis Lormel
Frequently, fraudsters are the more talented players.
5
Career Opportunities at Chartwell
Compliance
5
Chartwell Personnel Announcements
6
Advice on Consultants
Kris Welch
The OCC’s guidance on using third-party consultants
during enforcement actions.
8
NMLS Update
9
Chartwell Compliance Speaking and
Sponsorship Engagements
Trish Lagodzinski
Robert S. Niemi is the new Ombudsman.
10 NMLS Regulatory Updates
12 Points to Ponder & Heed
Regulations & Rules/Interpretations & Applications.
14 A Closer Look at Enforcement Actions
Jill Emerson
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17 Financial Industry Regulatory
Compliance: A New Era of Government
Enforcement
Jeffrey B. Coopersmith and Ashley L. Watkins
18 Representative Engagements
Editorial Staff
20 HelpDesk info
Iman Boussaada, Managing Editor
[email protected]
21 About Chartwell Compliance
Daniel A. Weiss, President & CEO
[email protected]
CHARTWELL COMPASS | MAY 2014
The 4th quarter of 2013 demonstrated the continued
increase of formal enforcement actions by federal
regulatory agencies.
1
Consultants, services, strategic alliances.
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How to Investigate a Good Fraudster
Dennis M. Lormel
Introduction
Baseball, football, basketball, hockey,
soccer and lacrosse are team sports.
Although each sport is different, the
objective is the same. Win the game.
There is one interesting commonality
each of these sports share when two
teams square off against each other on
the field of play. Having the most talented team does not always mean you win.
It certainly favors you. Having the best
prepared team is usually more advantageous. Come crunch time, when the
game is on the line, preparation could
well trump talent. The more talented
team, if not prepared, will likely play
with a lack of focus and discipline. The
better prepared team is more inclined
to follow their game plan and exploit
the vulnerabilities of their opponents,
and less likely to make mistakes, thereby preventing their opponent from exploiting their vulnerabilities. Thus, the
better prepared team is more likely to
carry the day.
If you liken fraud to a sporting event,
and you pit the fraudster against the investigator, the player that comes out on
top is usually the player who is better
prepared to perform. Frequently, fraudsters are the more talented players.
They tend to be proactive and are motivated by greed and arrogance. More
often than not, they have the advantage
of being proactive, while investigators
are reactive. However, when investigators take the time to prepare and plan
to deal with their adversary, they are
more likely to exploit the vulnerabilities of the fraudster. Such vulnerabilities start with the greed and arrogance
of the fraudster. Investigators must understand the crime problem, how the
fraudster operates, and to game plan
how to exploit the vulnerabilities of the
bad guy. In so doing, the likelihood of
conducting a successful investigation
improves greatly.
CHARTWELL COMPASS | MAY 2014
Law Enforcement and Private
Sector Fraud Investigators
Fraud investigations range from simple
to complex. Whether you are in law
enforcement or the private sector, the
methodology for conducting fraud investigations should be the same. You
want to take appropriate investigative
steps to identify suspicious activity
and/or prove the fraud, minimize financial loss and maximize the potential
for asset recovery. Some investigative
tools will be similar, while others will
vary. For example, law enforcement has
the ability to obtain evidence through
grand jury subpoenas and search warrants, as well as having the leverage of
making criminal arrests. Private sector
internal investigators have access to the
full gamut of records maintained by
their institution, as well as the leverage
to compel insiders to be truthful during
interviews at the risk of dismissal from
employment. The biggest variance between law enforcement and the private
sector is the final objective of the fraud
investigation. For law enforcement,
the objective is to develop evidence
that results in a criminal prosecution
and asset forfeiture. For private sector
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investigators, the objective is to protect
the reputation and integrity of the institution, prevent or minimize financial
losses and recover assets attributable to
the fraud.
Preparation and Planning
In preparing to conduct a fraud investigation, the investigator must understand the crime problem. What is
the nature of the fraud? What are the
elements of the suspicious or criminal
activity? Is there more to the fraud
scheme under the surface? What investigative steps must be taken to identify
suspicious activity or to prove a fraud?
For criminal investigators, you must
know the applicable laws and what level
of evidence is necessary to prove violations in court. For private sector fraud
investigators, you must have knowledge of your institutional policies and
procedures and the investigative steps
necessary to mitigate fraud.
Regardless of how simple or complex
a fraud scheme appears, investigators
should always prepare a written investigative plan. It does not matter how
simple a fraud scheme may be, an investigative plan should be required.
CHARTWELLCOMPLIANCE.COM
The plan should include:
▶▶The predication for the investigation
or factors warranting the
investigation
▶▶Elements to be proven
▶▶Logistical considerations such as
staffing and equipment needed
▶▶Investigative steps to be taken
▶▶Contingency planning
The first step in preparation is to
identify the fraud problem by determining the predicating factors. The
next step is to delineate the elements
of fraud that must be proven by investigation. Followed by that, logistical
considerations must be addressed to
include staffing, equipment and other
support requirements. When investigations lack adequate resources, especially in complex fraud matters, the
investigation is destined to fail. This is
one of the biggest shortcomings investigators must deal with. It is extremely
important to outline the investigative
steps to be taken. They must be reasonable, thorough and flexible in terms of
adapting investigative strategies to deal
with simple or complex schemes and
to plan for dealing with contingencies.
All investigative plans should include
contingencies in order to deal with
the known and unknown, as well as
the expected and unexpected. Nothing
should be taken for granted.
Planning for complex investigations
carries more significance and consequence; however, planning for more
simple frauds is equally as important. There are instances when what begins
as a simple fraud escalates into a massive fraud. In conducting fraud investigations, particularly schemes that
evolve into complex scenarios, it is easy
to lose focus and drift away from the intended investigation. This is why planning is important. Investigators should
maintain investigative discipline and
adhere to the written plan. This helps
maintain focus. Investigators should be
CHARTWELL COMPASS | MAY 2014
vigilant when assessing and investigating a fraud scheme to determine if there
is more to the scenario. Is the fraud
more complex? Is the fraud linked to
other frauds? How do you deal with
contingencies? Comprehensive investigative plans help answer these and
other questions.
Understand the Crime
Problem
An important part of preparation is to
understand the crime problem. Fraud
should be assessed and understood
from two perspectives: the generic
and the specific. From the generic and
more simplistic perspective, fraud is
intentional deception. The ability to
be deceptive and to avoid detection is
a fraudster’s primary key to success.
tool, investigators should study fraud
case typologies. Such case studies provide an insight into how fraudsters operate and exploit systemic vulnerabilities to perpetrate their frauds. Lessons
learned from prior fraud investigations
are a good learning tool. A great source
for case typologies comes from court
filings to include indictments, informations, plea agreements and other
charging documents. These legal filings usually contain a statement of facts
that delineates the criminal activity. Studying case typologies is an excellent
mechanism toward understanding the
crime problem. Participation in practical problems is an outstanding training
vehicle for investigators.
The best way to understand the fraud
crime problem is through first hand
investigative experience. The more ex-
A good fraudster always wants
to maintain the upper hand and
dictate the pace of the game. There
are subtle ways to handle this.
There are a myriad of different frauds.
As mentioned earlier, they range from
simple to complex. In addition to understanding fraud from a general sense,
it is imperative for investigators to understand the specific fraud schemes
with which they are confronted, as well
as those to which they are vulnerable. When investigators understand how
fraudsters take advantage of the generic
and specific fraud schemes, they position themselves to more effectively and
efficiently prepare and plan to compete
against fraudsters.
One mechanism that enhances understanding is training. As a training
3
perience investigators acquire, the better equipped they become to deal with
fraud. Learning from investigative experience is a powerful tool. One thing
all investigators should learn to rely on
is their investigative intuition, especially when dealing with the deception of
fraud. Investigators should trust their
instincts. They should compare and
assess the facts in their current case to
facts developed in their past experience
that support their instincts. If a situation
does not appear to be reasonable, trust
your instincts. Do not accept explanations until you are satisfied with the reasonableness of the representation.
CHARTWELLCOMPLIANCE.COM
Competing Against the
Fraudster
Game on! You have prepared and
planned the investigation, and understand the crime problem. It is time to
take on the adversary and investigate
the fraudster. Winning the game or accomplishing investigative success depends on how you handle the following
factors:
▶▶Upper hand
▶▶Spin and deception
▶▶Intimidation
▶▶Persistence
▶▶Analysis (reasonableness)
▶▶Exit strategy
Upper Hand
Intimidation
There will come a point when you ask
the fraudster a question that hits too
close to home or threatens to expose
the spin and deception. The usual response at that point will be defensive
and intimidating. Your adversary will
lash out at you. The fraudster will let
you know your question was stupid
and a waste of their valuable time. They
will be condescending in an attempt to
maintain the upper hand through intimidation. This is a sign you are on the
right track and that you have your adversary against the ropes. At this point,
the investigator should persevere.
Persistence
As the game plays on, there will be additional spin and deception to cover
the cracks in the framework of the
fraud. The situation could grow more
complex and challenging for the fraudster. As the investigator, you must be
persistent. Keep asking the questions
and break down the veneer of fraud.
Be persistent and meticulous in building your case, be it criminal or internal.
The more persistent the investigator is,
the more likely they’ll win the game.
A good fraudster always wants to maintain the upper hand and dictate the
pace of the game. There are subtle ways
to handle this. The fraudster wants to
be in control, and in most instances,
they consider themselves more intelligent than investigators. Let the fraudster think they have the upper hand.
They want you to know that they are
smarter than you are. If you allow them
the impression they have the upper
hand, they will invariably let their
guard down and talk. Use your listening skill and let them talk. It could be
their undoing.
Analysis supports persistence. There
are a variety of analytical tools available to investigators. Conduct thorough analyses to break down the spin
and deception. Continuously question
the reasonableness of the deceptive
representations made to you. At some
point, analysis and reasonableness will
outweigh spin and deception.
Spin and deception
Exit Strategy
The bad guy has weaved a tale of spin
and deception to facilitate their fraud
scheme. Be patient, disciplined and
meticulous. At some point, the weight
of the spin and deception will cave in
on the fraudster. Fraud schemes tend
to become more complex and difficult
to maintain as the scheme grows. At
some point, the fraud will unravel. By
maintaining investigative focus, the investigator will be in position to gain the
upper hand.
CHARTWELL COMPASS | MAY 2014
Analysis
Be mindful that throughout this process a good fraudster has an exit strategy. As the fraud scheme is about to
unravel, many fraudsters execute their
exit strategy. Do not allow yourself to
be taken by surprise. Be prepared to
address the fraudster’s exit strategy. There are a variety of exit strategies
good fraudsters might choose from.
The most common exit strategies include:
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▶▶Some fraudsters want to get caught
because the weight of their fraud
becomes overbearing
▶▶Some are too arrogant and greedy
and are blinded by the fact the end
is in sight
▶▶Some remain disciplined and
focused, and have what they
consider a safe haven to flee to
End Game
Keep in mind there will be an end game. This should be addressed in your written investigative plan. For criminal investigators, the end game is a criminal
prosecution and asset forfeiture. For
the private sector investigator, the end
game is to protect their institution’s assets and reputation. If the criminal and
private sector investigators are successful, they will have deprived the fraudsters from their exit strategy and end
game of living happily ever after with
the proceeds of their crime.
The combination of comprehensive
training, a written investigative plan,
discipline and focus, and reliance on
investigative experience and intuition,
position the good guys to be the better
prepared team. Come crunch time, it
affords them a competitive advantage
and the opportunity to better exploit
the vulnerabilities of their adversaries. In assessing the game, when the good
guys defeat the bad guys, regardless of
how talented the bad guys are, it is usually attributable to how the good guys
prepared, understood the crime problem and executed the game plan.
Dennis Lormel is a recognized
subject matter expert on antimoney laundering, terrorist financing, and fraud. He has 38 years of experience and is a specialist in financial crimes;
enhanced due diligence; FCPA; corporate
and mortgage fraud; forensic accounting;
AML; BSA; terrorist financing; asset recovery; and Sarbanes Oxley.
CHARTWELLCOMPLIANCE.COM
Professional Opportunity
Chartwell Compliance is seeking a
financial services regulatory compliance
professional with between three and ten
years of experience to join its consulting
team as a Compliance Professional or Senior
Compliance Professional.
This full-time position will be ideally
based in the Washington, DC or Denver, CO
areas; however, we will consider applicants
who can maintain a disciplined schedule
working in a remote environment.
The ideal candidate will have diverse
professional and subject matter expertise.
We will consider individuals on a case-bycase basis; however, applicants with some
combination of the following credentials are
most desirable:
▶▶At least 3-10 years of experience with
financial regulatory compliance, in AML
compliance, consumer compliance, state
money transmitter licensing or safety and
soundness;
▶▶Experience working in or with banks and
money services businesses;
▶▶High self-initiative and strong group
leadership abilities. Aspire to growth and
leadership within Chartwell.
▶▶Quick, efficient, highly organized and
able to get up to speed rapidly.
▶▶ Comfort working in ambiguous
situations, for example, a company in
an industry which just became subject
to BSA/AML and for which we need to
design compliance documentation from
scratch.
▶▶Extraordinary work ethic. Work weeks
typically exceed a normal 40 hour
schedule.
communication skills.
▶▶At ease multi-tasking under deadlines
and working outside your comfort zone.
▶▶Excited about working in a start-
up company and assisting start-up
companies, with the fluidness, creativity
and risk/reward entailed.
▶▶Comfortable developing new and existing
▶▶Experience in consulting;
▶▶Experience in or with start-up
▶▶U.S. citizenship or working papers is
companies.
Client work on any given day will be
diverse, such as developing compliance
manuals and risk assessments, conducting
BSA/AML or consumer compliance
independent reviews and training,
assisting with outsourced administration
of compliance programs and state MSB
licenses, and completing state MSB license
applications. Most of the work can be
conducted off-site; however, candidates
should expect up to 50% travel to client
locations. In addition, the position will
entail contributing to Chartwell Compass
and assisting with business development.
As the firm is an early-stage business,
the candidate’s non-technical attributes are
as important as their other professional
qualifications. Our consultant profile is an
all-around contributor to multiple areas
of the firm and who has ambition to attain
positions of increasing responsibility.
The ideal candidate will possess some
combination of the following non-technical
qualifications:
CHARTWELL COMPASS | MAY 2014
We are pleased to announce
that Trish Lagodzinski
has been promoted to
Compliance Director.
▶▶Excellent verbal and written
▶▶Experience in the private sector,
financial services supervision and/or law
enforcement;
Chartwell Personnel
Announcements
client relationships and seeking business
development opportunities.
Jeanne Schurott has been
promoted to Director,
Compliance and Strategic
Financial Planning
required.
▶▶A Bachelor’s Degree with at least a
3.25 GPA in a business, management,
financial, or related discipline is
preferred. Industry certifications
(ACAMS, CRCM, CCCS, CCBCO, and
related) are preferred but not required.
Chartwell compensation packages are
highly competitive; salary is based on
experience and benefits are diverse. Our
quickly-growing company offers extraordinary opportunities for upward professional
and personal mobility and the chance to
work with a close-knit group of highly-experienced colleagues in a dynamic setting.
For more information about Chartwell,
please visit www.chartwellcompliance.com.
Interested applicants should submit a cover letter and resume to careers@chartwellcompliance.
com. The cover letter should address how you
meet some of the technical and non-technical
qualifications, your start date, preferred location, and other topics you believe are relevant.
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Langley Perry, an attorney
and former Eagle Scout, has
joined the firm as Associate
Compliance Professional
Petra Hrachova, CRCM, CAMS,
previously a Federal Reserve
compliance examiner and
community bank compliance
officer, has joined the firm as Senior
Compliance Professional
CHARTWELLCOMPLIANCE.COM
Advice on Consultants
The OCC’s guidance on using third-party
consultants during enforcement actions
By Kris Welch
As part of an enforcement action or
when remedial actions are needed, the
Office of the Comptroller of the Currency may require national banks and
federal thrifts to engage an independent
consultant to ensure that independent
judgment and the requisite expertise are
employed. In November, the OCC issued
Bulletin 2013-33, which establishes standards and provides guidance to national
banks and, federal savings associations
when engaging independent consultants
as part of an enforcement action to address significant violations of law, fraud
or harm to consumers.
The bulletin is not applicable when the
OCC requires a bank to hire a consultant
to provide expertise needed to correct
operational or management deficiencies.
In those circumstances, banks should
review and implement the guidance
outlined in OCC Bulletin 2013-29 titled
“Third-Party Relationships.”
CHARTWELL COMPASS | MAY 2014
Through its enforcement authority, the OCC has ordered banks of all
sizes to retain independent consultants.
Such consultants have been engaged to:
▶▶assess the bank’s compliance
with legal requirements in cases
involving material violations of law;
▶▶assist in providing guidance
for restitution for violations of
consumer protection statues;
▶▶identify affected consumers,
monitor payments to such
consumers and provide written
reports evaluating remediation
regarding significant consumer law
violations, which include Section 5
of the Federal Trade Commission
Act regarding unfair or deceptive
practices;
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▶▶test and address significant
deficiencies with a bank’s or thrift’s
Bank Secrecy Act program (staffing,
risk assessment and internal
controls);
▶▶review transaction activity to
determine whether banks must file
Suspicious Activity Reports and
whether such SARs filed require
amendments;
▶▶review transaction activity to
determine whether banks must file
Currency Transaction Reports for
large cash reporting; and
▶▶perform forensic audits in cases
where the OCC has concerns about
widespread fraud or systemic
irregularities in bank records.
CHARTWELLCOMPLIANCE.COM
When the OCC determines that
an enforcement action requires the
use of an independent consultant, the
agency requires a bank to submit due
diligence information conducted on
the independent consultant, including
the proposed independent consultant’s
qualifications and terms of service for
OCC’s review and approval.
The guidance outlines three primary
areas of consideration when conducting due diligence on the consultant:
1. Due diligence expected of an
institution proposing to engage
an independent consultant.
In conducting due diligence, a
bank should be guided by OCC
Bulletin 2013-29, “Third-Party
Relationships: Risk Management
Guide,” as well as by 2013-30
Guidance.
When a bank submits the
determination of supervisory
no objection to a proposed
independent, it should submit
its evaluation of the consultant’s
qualifications, independence,
resources, expertise, capacity,
reputation, information security
and document custody practices,
risk management and reporting,
conflicts of interests, financial
viability of the consultant and any
professional disciplinary actions
filed against the consultant and
the impact of such actions on the
engagement.
2. Assessing the independence of
the consultant. The assessment
of the proposed consultant’s
independence should include any
existing and prior relationships
with the bank, affiliates or insiders;
any potential conflicts of interest;
and any other relevant factors. The
bank should ask the consultant
to provide assurances that the
proposed engagement will not
breach any professional restrictions
governing conflicts of interest to
which the consultant is subject.
CHARTWELL COMPASS | MAY 2014
3. Engagement contract and work
plan. The bank should ensure the
proposed consultant engagement
contract guarantees that:
▶▶compliance with applicable
laws and regulations (including
those related to privacy and
confidentiality);
▶▶maintenance of complete records;
▶▶availability of work papers, analysis,
drafts and reports;
▶▶disagreements of material matters
that cannot be resolved between
the bank and the consultant are
brought to the OCC’s immediate
attention;
▶▶ongoing reporting requirements are
identified and met;
▶▶the consultant is available to meet
or discuss matters privately with
the OCC;
▶▶the conclusions and
recommendations provided by the
consultant are based on its own
independent and expert judgment,
although the consultant may
consider the bank’s views;
▶▶the institution’s board of directors
receives a final report;
▶▶material modifications to the
contract work plan must be
approved by the OCC in writing;
▶▶any work covered by the
engagement, which will be
subcontracted will require written
approval by the OCC; and
▶▶the contract shall be terminated
by the institution upon written
direction from the OCC to the
institution without any objection or
right of appeal by the consultant.
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Even while engaging an independent consultant, an institution’s board
of directors will still be held responsible to ensure that all needed corrective actions are identified and implemented.
The OCC oversees compliance with
the enforcement action and the progress of the engagement through its
supervisory authority. Considerations
governing the agency’s monitoring include the (1) nature of deficiencies or
violations the independent consultant
is engaged to identify including with
respect to recommendations regarding
remediation (2) scope and duration of
work and (3) potential for a materiality
of harm to consumers and the bank.
During the contact, there may be
interactions between the OCC, the
bank and the consultant depending on
the particular facts and circumstances
addressed in the enforcement action,
expertise and resources of bank management, nature of the independent
consultant’s engagement and timeline
for completing the engagement.
As part of the assessment of the
bank’s compliance with the enforcement action, the OCC must determine
whether the bank has addressed and
corrected the violations or deficiencies
that formed the basis for the enforcement action. The OCC will review the
independent consultant’s final written
report of findings and recommendations to the bank’s board of directors
and management. This review provides the OCC the opportunity to assess whether all matters defined in the
enforcement action and reviewed by
the independent consultant were adequately addressed, and if not, the OCC
may require the independent consultant to perform some additional work. 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
reporting programs.
CHARTWELLCOMPLIANCE.COM
New NMLS
Ombudsman
Appointed
at the NMLS
Annual
Conference
and Training
Conference
Trish Lagodzinski
Chartwell Compliance participated
in the Ombudsman meeting again this
year during the Nationwide Mortgage
Licensing System and Registry (NMLS)
Annual Conference and Training Conference and Training on February 1821, 2014 in Miami, Florida.
Designed for both new and experienced users of NMLS and attended by
state and federal regulators and licensees and registrants of all types, the Conference provides an invaluable exchange
of information among NMLS users on
system and regulatory compliance issues that affect their organizations.
The NMLS licensees vary greatly
from mortgage companies, mortgage
loan originators, and banks to the new
money services businesses including
money transmitters, collection agencies, check cashers/sellers, pawnbrokers, consumer finance companies (insurance premium, motor vehicle, retail
installment), small loan, and deferred
deposit lenders. NMLS is a web-based
system that allows non-depository companies, branches, and individuals in the
mortgage, consumer lending, moneyservices businesses, and debt collection
industries to apply for, amend, update,
or renew a license online using a single
set of uniform applications.
A feature of the annual conference
and open to the general public, the
NMLS Ombudsman meeting provides
the financial services industries and
other interested parties with a neutral
CHARTWELL COMPASS | MAY 2014
venue to discuss issues or concerns regarding NMLS and state licensing. The
NMLS Ombudsman Meeting is an opportunity for any NMLS user to raise
issues concerning NMLS or state regulation of the financial services related
industries managed on NMLS. The
objective of the NMLS Ombudsman is
to foster constructive dialogue between
NMLS industry users and participating
state regulators to mutually work toward the goal of modern and efficient
state regulation. The Acting NMLS
Ombudsman Sue Clark, Director of
Regulatory and Consumer Affairs at
the Vermont Department of Financial
Regulation presided over meeting on
February 18, 2014. Chartwell participated in the Ombudsman meeting by sharing ideas
for enhancing reporting, storage and
uploading capabilities as well as expanding the categories for types of
documents in the system. Enhanced
features on NMLS for licensing, renewals, and ongoing reporting documentation would reduce the time, cost, and
inconvenience of mailing documents
to the states for money services business registration and renewal. As more
8
states transition to NMLS, there is an
increased variety of state-specific documentation and reporting requirements.
The NMLS Document Uploads Section
contains a limited number of categories of documents for users to choose
from. Users generally select Document
Samples from the menu under Document Type as the default for the miscellaneous documentation uploads, which
often leads to a large and cluttered field. Adding additional document categories
would help organize the document uploads section for users and regulators.
Other issues of interest to money
services businesses included direct
contact information for any regulator
adding a license item/deficiency in the
NMLS system and status requirements/
timelines; accuracy of state checklists
and changes to state checklists; multistate examinations and the Advance
Change Notice policy and functionality
in NMLS. In addition, other financial
services companies discussed topics
on Mortgage Loan Originator supervision; individual watch lists; branch surrenders; test score reporting; call center
processes; and NMLS as the system of
record.
CHARTWELLCOMPLIANCE.COM
During the meeting, it
was announced that
Robert S. Niemi, Deputy
Superintendent for
Consumer Finance with
the Ohio Division of
Financial Institutions,
is the new Nationwide
Mortgage Licensing
System and Registry
(NMLS) Ombudsman.
Speaking &
Sponsoring
Engagements
Chartwell Compliance
has launched a new website
Chartwell Compliance is pleased to announce the
launch of its new website, designed with a fresh
new look, user-friendly navigation and updated
information on products and services. One of the new
features is a Knowledge Base search feature, to give
you easy access to Chartwell’s database of articles,
webinars, and presentations produced by Chartwell
consultants.
ICBA and Chartwell Compliance
Extend Relationship to Offer ICBA
Compliance and Risk Management
During the meeting, it was announced that Robert S. Niemi,
Deputy Superintendent for Consumer Finance with the Ohio Division of Financial Institutions, is the new Nationwide Mortgage
Licensing System and Registry (NMLS) Ombudsman. Mr.Niemi
oversees the non-depository lenders in the state of Ohio including 16 license types and nine sections of the Ohio Revised Code. He will serve as NMLS Ombudsman while fulfilling his duties
with the Ohio Division of Financial Institutions.
Prior to joining the State of Ohio, Mr. Niemi worked for more
than 23 years in the mortgage industry including both depository
and non-depository lenders. He has held regional and national
management positions with various mortgage associations across
the Midwest.
Mr. Niemi succeeds Tim Siwy, former Acting Deputy Secretary
of Non-Depository Institutions and Consumer Services for the
Pennsylvania Department of Banking and Securities. Mr. Siwy
was preceded by the first NMLS Ombudsman, Deb Bortner, Director of Consumer Services with the Washington Department of
Financial Institutions.
More information about the NMLS Ombudsman and the current list of issues being considered can be found at the NMLS
Ombudsman section of the NMLS Resource Center.
Trish Lagodzinski has more than 19 years of experience in
government contracting, project management and support. For
more information please contact Trish Lagodzinski at [email protected]. Additional Sources: Conference of
State Bank Supervisors (“CSBS”) and State Regulatory Registry LLC.
CHARTWELL COMPASS | MAY 2014
9
Chartwell Compliance and the Independent
Community Bankers of America (ICBA) have
extended their agreement to continue offering ICBA
Compliance and Risk Management to community
banks.
“ICBA is pleased to continue its relationship with
Chartwell Compliance to bring premier ICBA
Compliance and Risk Management offerings to
community banks,” said Dan Clancy, ICBA executive
vice president of services. “Chartwell’s wide variety of
services are able to meet the simplest to most complex
compliance needs of community banks across the
country.”
For the full press release please visit the ICBA website
Chartwell Compliance
Sponsors Money2020
November 2-6, 2014, Las Vegas.
Chartwell Compliance’s Daniel Weiss and Iman
Boussaada will be attending the third annual
Money2020 conference in Las Vegas. Chartwell will
be joining 6,500 anticipated attendees from 2,000
companies and 50 countries.
Money2020 brings together the worldwide community
of innovators who are disrupting the way in which
consumers and businesses manage, spend and borrow
money, and explores the macro trends that form
the underlying common thread of innovation, such
as the mobile Internet, platform connectivity and
interoperability, and consumer empowerment.
CHARTWELLCOMPLIANCE.COM
Regulatory Updates
Licenses for Non-Depository Institutions in NMLS States
Idaho
Department of
Finance
Money Transmitter
Start Date: 9.1.2012
Transition Due: 10.1.2012
Collection Agency License
Start Date: 9.3.2013
Payday Lender License
Start Date: 9.3.2013
Regulated Lender License
Start Date: 9.3.2013
Indiana
Department of
Financial Institutions
Money Transmitter
License
Start Date: 11.1.2013
Indiana
Secretary of State
Collection Agency
Start Date: 11.1.2012
Transition Due: 12.31.2012
Iowa
Division of Banking
Debt Management License
Start Date: 7.1.2013
Delayed Deposit Services
Business Branch License
Start Date: 7.1.2013
Transition Due: 10.1.2013
Delayed Deposit Services
Business Registration
Start Date: 7.1.2013
Money Services License
Start Date: 7.1.2013
Kansas
Office of the State
Commissioner
CHARTWELL COMPASS | MAY 2014
Money Transmitter
License
Start Date: 11.1.2013
Transition Due: 7.31.2012
Foreign Transmittal
Agency
Start Date: 4.16.2012
Transition Due: 6.30.2012
Kentucky
Department of
Financial Institutions
Insurance Premium
Finance
Start Date: 4.16.2012
Transition Due: 6.30.2012
Money Transmitter
Start Date: 8.1.2012
Louisiana
Office of Financial
Institutions
Motor Vehicle Sales
Finance
Start Date: 4.16.2012
Transition Due: 9.30.2012
Insurance Premium
Finance
Start Date: 7.1.2012
Transition Due: 10.1.2012
Retail Installment Sales
Finance
Start Date: 4.16.2012
Transition Due: 9.30.2012
Licensed Lender
Start Date: 7.1.2012
Transition Due: 10.1.2012
Small Loan
Start Date: 4.16.2012
Transition Due: 8.31.2012
Pawnbroker
Start Date: 7.1.2012
Transition Due: 10.1.2012
Michigan
Office of Financial
and Insurance
Services
Sale of Checks and Money
Transmitter
Start Date: 7.1.2012
Transition Due: 10.1.2012
Maryland
Commissioner of
Financial Regulation
Money Transmitter
License
Start Date: 9.3.2013
Transition
Deadline: 11.1.2013
Money Transmitter
Start Date: 1.2.2013
Transition Due: 3.4.2013
Minnesota
Department of
Commerce
Massachusetts
Division of Banks
Money Transmitter
License
Start Date: 10.1.2013
Transition Deadline:
12.1.2013
Check Casher
Start Date: 4.16.2012
Transition Due: 6.1.2012
Nebraska
Department of
Banking and Finance
Check Seller
Start Date: 4.16.2012
Transition Due: 8.31.2012
Installment Loan
Start Date: 4.15.2013
Debt Collector
Start Date: 4.16.2012
10
New Hampshire
Banking Department
Debt Adjuster
Start Date: 7.9.2012
Money Transmitter
Start Date: 6.24.2013
Motor Vehicle Retail
Seller
Start Date: 7.9.2012
Motor Vehicle Sales
Finance Company
Start Date: 7.9.2012
Small Loan Lender
Start Date: 7.9.2012
North Dakota
Department of
Financial Institutions
Collection Agency Branch
Registration
Start Date: 7.1.2013
Transition Due: 8.1.2014
Collection Agency License
Start Date: 7.1.2013
Transition Due: 8.1.2014
Debt Settlement Service
Provider Branch Registration
Start Date: 7.1.2013
Transition Due: 8.1.2014
Debt Settlement Service
Provider License
Start Date: 7.1.2013
Transition Due: 8.1.2014
Deferred Presentment
Service Provider Branch
License
Start Date: 10.25.2013
Transition Deadline:
8.1.2014
Deferred Presentment
Service Provider License
CHARTWELLCOMPLIANCE.COM
Start Date: 7.1.2013
Transition Due: 8.1.2014
Debt Management Services
Start Date: 9.1.2012
Money Transmitter
License
Start Date: 7.1.2013
Transition Due: 8.1.2014
Money Transmission
Start Date: 9.1.2012
Oklahoma
Department of
Banking
Money Transmission
License
Start Date: 10.1.2012
Transition Due: 10.1.2013
Oklahoma
Department of
Consumer Credit
Deferred Deposit Lender
Start Date: 4.16.2012
Oregon
Department of
Consumer and
Business
Services Consumer Finance License
Start Date: 1.2.2014
Pennsylvania
Department of
Banking
Accelerated Mortgage Payment Provider
Start Date: 9.1.2012
CHARTWELL COMPASS | MAY 2014
Check Cashier
Start Date: 2.15.2013
Transition Due: 4.30.2013
Retail Grocery Store
Check Casher
Start Date: 2.15.2013
Transition Due: 4.30.2013
Pawnbroker License
Start Date: 8.1.2013
Transition Due: 9.30.2013
Rhode Island
Division of Banking
Sales of Checks
Start Date: 4.16.2012
Transition Due: 6.30.2012
Money Transmitter
Start Date: 7.1.2012
Transition Due: 9.30.2012
Small Loan Lender
Start Date: 4.16.2012
Transition Due: 6.30.2012
Sales Finance
Start Date: 4.16.2012
Transition Due: 6.30.2012
Tennessee
Department of
Financial Institutions
Washington
Department of
Financial Institutions
Deferred Presentment
Start Date: 8.1.2012
Transition Due: 10.1.2012
Check Casher
Start Date: 7.30.2012
Check Casher with Small
Money Transmitter
License
Start Date: 10.1.2013
Loan Endorsement
Start Date: 7.30.2012
Utah
Department of
Financial Institutions
Check Casher
Start Date: 4.16.2012
Transition Due: 6.30.2012
Deferred Deposit Lender
Registration
Start Date: 11.1.2013
Transition Date: 12.31.2013
Debt Collector Registration
Start Date: 9.3.2013 Debt Management Services
Start Date: 4.16.2012
Transition Due: 6.30.2012
Electronic Money Transfers
Start Date: 4.16.2012
Transition Due: 6.30.2012
Money Transmitter
Start Date: 4.16.2012
Wisconsin
Department of
Financial Institutions
Vermont
Division of Banking
Seller of Checks
Start Date: 7.1.2013
Check Casher & Currency
Exchange
Start Date: 7.1.2012
Transition Due: 9.30.2012
Wyoming
Division of Banking
Debt Adjuster
Start Date: 11.1.2012
Transition Due: 3.31.2013
11
Currency Exchanger
Start Date: 4.16.2012
Money Transmitter
License
Start Date: 9.30.2013
CHARTWELLCOMPLIANCE.COM
Points to Ponder & Heed
Regulations & Rules | Interpretations & Applications
Final Rules and
Interpretations
▶▶ FinCEN Ruling on Records of
Foreign Exchange Dealers Issued
▶▶ IRS Issues Virtual Currency
Guidance
FinCEN Issues New Rulings
FinCEN announced on April 29,
2014 five new rulings:
FIN-2014-R004 — Application of
Money Services Business Regulations to a Company that Offers Escrow Services to a Buyer and Seller
in a Given Internet Sale of Goods or
Services. Read article.
FIN-2014-R005 — Whether a Company that Offers Secured Transaction Services to a Buyer and Seller in
a Given Sale of Goods or Services is
a Money Transmitter. Read article.
FIN-2014-R006 — Whether a
Company that Provides Online
Real-Time Deposit, Settlement, and
Payment Services for Banks, Businesses and Consumers is a Money
Transmitter. Read article.
FIN-2014-R007 — Application of
Money Services Business regulations to the rental of computer
systems for mining virtual currency.
Read article.
FIN-2014-R008 — Whether a
Company that Provides an Armored
Car Coin and Currency Exchange
Service is a Money Transmitter and
Whether the Armored Car Service
Exemption Would Apply to the
Service. Read article.
CHARTWELL COMPASS | MAY 2014
Proposed Regulations and Rules
▶▶ FinCEN Ukrainian Advisory
▶▶ CFPB Files Suit against ITT Educational
Services
▶▶ Ukraine-Related Executive Order
Released
▶▶ FTC to Review Customer Info Security
Standards
▶▶ Homeowner Flood Insurance
Affordability Act
Emerging Regulatory Issues
▶▶ New York to License Virtual Currency
Exchanges
▶▶ FTC and Court Shut Down Debt
Collector
▶▶ The FTC announced on March 13,
2014 that a U.S. District Court has
approved an FTC-requested Temporary
Restraining Order and Asset Freeze to
halt the debt collection operations of
Federal Check Processing, Inc., alleged
to have misrepresented that they were
with the government, falsely accused
consumers of committing check fraud,
and threatened consumers with arrest.
▶▶ Consumer Compliance Interagency
Exam Bulletin Issued
▶▶ CFPB Unveils Prepaid Cards Disclosure
Concepts
▶▶ FinCEN Director Discusses AML High
Profile Issues
▶▶ Suit Against Tribal-Affiliated Payday
Lender to Proceed
▶▶ ID Theft Schemers Indicted
12
▶▶ DOJ Settles ADA Suit Over Website and
Mobile Apps
▶▶ Caribbean-Based Scheme To Launder
Bank Fraud Proceeds Halted
▶▶ The Justice Department and IRS
announced on March 24, 2014 the
indictment of one U.S. and two
Canadian citizens based in the
Caribbean on charges of laundering
of $200,000 of supposed bank fraud
proceeds.
▶▶ Payday Lenders in CFPB’s Crosshairs
▶▶ FinCEN Advisory on FATF-Identified
Jurisdictions
▶▶ On March 25, 2014 FinCEN issued
Advisory FIN-2014-A003 on the recent
update of the FATF list of jurisdictions
with strategic AML/CFT deficiencies.
The changes may affect U.S. financial
institutions’ obligations and risk-based
approaches with respect to the named
jurisdictions.
▶▶ BofA Pays $9.3B To Settle Claims
▶▶ On March 26, 2014 the FHFA
announced they reached a $9.3 billion
settlement in cases involving Bank
of America (BofA), its subsidiaries
Countrywide Financial and Merrill
Lynch, and certain named individuals.
▶▶ Former BofA CEO Barred In Settlement
▶▶ Interchange Ruling Reversed
▶▶ FDIC Enforcement Actions Released
▶▶ The FDIC released on March 28, 2014
a list of 39 administrative enforcement
actions taken in February against banks
and individuals, including three consent
orders, five removal and prohibition
orders, five civil money penalties
CHARTWELLCOMPLIANCE.COM
Points to Ponder & Heed
Regulations & Rules | Interpretations & Applications
(CMPs), and three section 19 orders,
together with various termination and
amendment orders.
▶▶ FTC Settles Unsecure Mobile Apps
Complaints
▶▶ Seven Individuals Indicted in Mortgage
Scheme
▶▶ CFPB Reports Increased Complaint
Volume
Other Industry Issues of Interest
▶▶ FDIC Quarterly Banking Profile
Released
▶▶ $122M Settlement Announced by FHFA
▶▶ The FHFA, as conservator of Fannie
Mae and Freddie Mac, announced on
February 27, 2014 a settlement with
Société Générale, related companies and
specifically named individuals for $122
million.
▶▶ ID Theft Still at Top of Consumer
Complaint List
▶▶ NMLS Conference Blog Available
▶▶ Credit Report Error Tips by CFPB
▶▶ The sixth annual NMLS Conference
▶▶ Reminder of Removal of OFAC
and Training concluded on February
21. The conference featured popular
general sessions, breakouts by industry
type, and training opportunities. The
Conference Blog provides highlights,
along with interviews and commentary
from speakers and guests.
▶▶ Stress Test Results Release Dates by FRB
▶▶ On February 25, 2014 the FRB
announced March 20 and March 26 as
release dates for the latest supervisory
stress tests results and related results
from the Comprehensive Capital
Analysis and Review.
▶▶ OCC State Fact Sheets Released
▶▶ FDIC Consumer News Available
Archives
▶▶ FDIC Enforcement Actions Released
▶▶ FDIC CRA Evaluations Issued
▶▶ CFPB Reports on Servicemember
Complaints
▶▶ FRB Fixed-Rate Offering Results
Available
▶▶ FDIC state profiles Posted
▶▶ FRB Annual Statements Available
▶▶ March FedFlash Released
▶▶ FATF Issues Mutual Evaluation Reports
Issued
▶▶ CFPB Financial Planning Worksheet
▶▶ HUD Disaster Recovery Grants
▶▶ The CFPB Blog released on February
▶▶ On March 17, 2014 HUD issued press
Available
25, 2014 features instructions for the
use of the CFPB My New Money Goal
financial planning worksheet.
▶▶ Insured Institutions Earn $40.3B In
Fourth Quarter
CHARTWELL COMPASS | MAY 2014
Announced
releases announcing a total of $436M
in additional Disaster Recovery Grants
will be provide to help communities
in Oklahoma, Illinois, and Colorado
recover from 2013 tornadoes, storms
and flooding
13
▶▶ FEMA to Suspend Communities
▶▶ FRB Announces Bank Stress Test
Results
▶▶ CFPB Consumer Complaint Report
Available
▶▶ Tax Return Preparer Permanently
Barred
▶▶ OCC Posts Enforcement Actions
▶▶ Comptroller’s Handbook Exam
Procedures Update
▶▶ OCC Bulletin 2014-8 was issued
on March 24, 2014 announcing
the addition of supplemental
examination procedures regarding
end-user derivatives and trading
activities to the “Risk Management of
Financial Derivatives” booklet of the
Comptroller’s Handbook.
▶▶ OCC Reminders Of Impending
Compliance Dates Issued
▶▶ FRB Mobile Banking Survey Issued
▶▶ On March 25, 2014 the FRB issued
a summary report of its most recent
Survey of Consumers’ Use of Mobile
Financial Services. The first survey was
conducted in December 2011 and the
recent survey was conducted online
during December 2013 with over 2,600
responding.
▶▶ CCAR Results Released by FRB
▶▶ OCC Mortgage Metrics Report
Available
▶▶ CFPB TILA-RESPA Rule
Compliance Guide Released
▶▶ New Garnishment Booklet Added to
Comptroller’s Handbook
CHARTWELLCOMPLIANCE.COM
A Closer Look at
Enforcement Actions
Jill Emerson
To no surprise, the 4th quarter of 2013 demonstrated the continued increase of formal enforcement actions by federal regulatory agencies
for financial institutions and nonbank financial
institutions alike. Large civil money penalties
are connected to these enforcement actions. Not
to mention, the number of informal enforcement actions likely reached heightened records.
What are enforcement actions?
Federal regulators employ the use of enforcement actions as a standardized way for communicating deficiencies in a financial institution’s
condition and for outlining corrective actions
necessary to return the financial institution to
sound condition and full compliance with laws
and regulations. Enforcement actions usually
establish timetables for required corrections to
be resolved.
Can you identify the types of enforcement actions?
Each federal regulator follows policies and
procedures for the initiation of an enforcement
action. While the agencies may take a different
approach as to whether an enforcement action
should be instituted or the degree of severity of
an enforcement action, the agencies all use similar enforcement tools and each agency labels
these actions differently. Also, keep in mind,
Since the financial
crisis of 2007, we
have witnessed a
number of significant
compliance
breakdowns and
the subsequent
importance on
consumer protection.
CHARTWELL COMPASS | MAY 2014
that state banking regulators have the authority to generate enforcement
actions, which for state-chartered institutions could result in dual enforcement actions. It’s important to recognize the various types of enforcement actions in the event that your financial institution may need to
respond if an enforcement action is presented by your federal regulator.
Also, it’s a good business practice to briefly analyze enforcement actions
as they are released (more on this later).
There are two broad classifications of enforcement actions: informal
and formal. Federal regulators utilize a variety of informal tools used in
less serious circumstances; examples include:
▶▶Commitment letters
▶▶Board resolutions
▶▶Memoranda of understanding
▶▶Safety and soundness plans
Informal actions are not public and are not enforceable in court. While
informal actions may seem minor; left unresolved, they can become a
perpetual thorn and can evolve into much more serious actions.
Formal enforcement actions are enforceable and various actions include:
▶▶Consent Orders
▶▶Temporary Cease and Desist Orders
▶▶Cease and Desist Orders
▶▶Removal and Prohibition Orders
▶▶Written Agreements
▶▶Prompt Corrective Action Directives
▶▶Safety and Soundness Orders
▶▶Suspension/Termination of Insurance
▶▶Civil Money Penalties
Because of the public nature of formal enforcement actions as well as
the costs of corrective measures to comply with the action, a financial
institution’s reputation is at stake. With the increase and severity of enforcements and the civil money penalties that follow, it is imperative that
financial institutions take preventative measures to protect their reputations.
Why the increase in enforcement actions?
Since the financial crisis of 2007, we have witnessed a number of significant compliance breakdowns and the subsequent importance on
consumer protection. State and federal regulators are now more vigilant
evidenced by historic high rates of enforcement actions, and this trend
may continue. While enforcement actions are one of the unfortunate
consequences of the financial crisis, your financial institution does not
have to be one of the casualties.
14
CHARTWELLCOMPLIANCE.COM
In December 2013 the CFPB joined with the authorities in 49
states and the District of Columbia in filing a proposed court
order requiring the country’s largest nonbank mortgage loan
servicer, Ocwen Financial Corporation, and its subsidiary,
Ocwen Loan Servicing, to provide $2 billion in principal
reduction to underwater borrowers. The consent order addresses Ocwen’s systemic misconduct at every stage of the
mortgage servicing process. Ocwen must also refund $125
million to the nearly 185,000 borrowers who have already
been foreclosed upon and it must adhere to significant new
homeowner protections.
Fair lending
In December 2013 the CFPB and Department of Justice filed
a joint complaint and proposed Consent Settlement Order
against National City Bank for charging higher prices on
mortgage loans to African-American and Hispanic borrowers than to similarly creditworthy white borrowers between
the years 2002 and 2008. The Order would require PNC
Bank, National Association, the successor-in-interest to National City Bank, to establish a settlement fund to pay $35
million in restitution to harmed African-American and Hispanic borrowers.
Understand what’s being enforced – do you know?
With the Dodd-Frank Wall Street and Consumer Protection Act (Dodd-Frank Act) rollout, the spotlight is directed
more towards consumer protection in all facets of financial
services including fair lending, unfair and deceptive abusive
acts and practices (UDAAP), and mortgage lending, not to
mention others. As we’ve all experienced, financial institutions undergo regularly scheduled examinations. As regulators find deficiencies, dependent on the nature, scope and
seriousness, regulators have a menu of options to issue informal or formal enforcement actions. The issues that typically
arise from such examinations include capital, asset quality or
management from the safety and soundness arena; or, BSA/
AML compliance and consumer protection issues regarding
compliance with consumer protection laws and regulations.
Just during the 4th quarter of 2013 we’ve seen the following
enforcement actions surrounding:
In December 2013 the CFPB in conjunction with the Department of Justice announced an order requiring Ally Financial
Inc. and Ally Bank to pay $80 million in damages to harmed
African-American, Hispanic, and Asian and Pacific Islander
borrowers, plus $18 million in penalties. The CFPB and DOJ
determined that more than 235,000 minority borrowers paid
higher interest rates for their auto loans between April 2011
and December 2013 because of Ally’s discriminatory pricing
system.
▶▶Multiple flood enforcement actions
▶▶Regulation B violations resulting in civil money penalties
▶▶Various actions for BSA/AML compliance and OFAC
▶▶HMDA penalties
▶▶Various fair lending actions ▶▶UDAAP violations
▶▶Multiple nonbank entities and consumer protection
In November 2013 HUD announced that MortgageIT, Inc.,
an indirect subsidiary of Deutsche Bank, agreed to pay $12.1
million under a Conciliation Agreement with HUD, to resolve allegations that the residential lender discriminated
against African American and Hispanic borrowers seeking
mortgage loans. HUD had alleged that the lender’s practices contributed to minority borrowers being charged higher
APRs and fees than similarly-situated white borrowers, and
denied minority applicants loans more often than similarlysituated white applicants.
concerns
Examples of Recent Actions
Here are examples of enforcement actions taken during the
fourth quarter of 2013:
UDAAP
In December 2013 the OCC, CFPB and FDIC coordinated their actions and issued separate orders against several
American Express companies under their regulatory supervision for billing and marketing practices violating Section
5 of the Federal Trade Commission Act, 15 U.S.C., section
45(a)(1), which prohibits unfair and deceptive acts or practices, including its marketing and delivery of certain “credit
card add-on” products. The combined orders, with previously completed reimbursements, resulted in restitution of approximately $59.5 million to more than 335,000 consumers.
CHARTWELL COMPASS | MAY 2014
BSA/AML/OFAC
In December 2013 the FRB announced the payment of $50
million by the Royal Bank of Scotland (RBS) to settle potential civil liability for apparent violations of the Iran, Sudan,
Burma, and Cuba sanctions programs. In separate actions,
OFAC announced a settlement of $33 million, which is
deemed satisfied by the payment to the Fed; and the New
York State Department of Financial Services announced its
own settlement of $50 million with RBS. The RBS payment
to the Federal Reserve will be passed on to the U.S. Treasury.
15
CHARTWELLCOMPLIANCE.COM
In November 2013 the Treasury announced a $91,026,450 settlement—
a record amount outside of the banking industry—with Weatherford
International Ltd. and its subsidiaries and affiliates regarding potential
liability for violations of Cuban Assets Control, Iranian Transaction
and Sanctions, and Sudanese Sanctions regulations. The base penalty
for the 586 violations totaled over $107 million. OFAC determined that
Weatherford’s conduct was willful, and various executives and senior
management knew or had reason to know of the conduct that led to
the violations. The penalty was mitigated because Weatherford had not
been subject to prior OFAC penalties, took significant remedial steps
to ensure future compliance, and substantially cooperated with OFAC’s
investigation.
Do you know what to analyze when reviewing enforcement actions?
Reviewing enforcement actions does not have to be a lengthy or
time-consuming process. It is a good business practice to peruse actions to glean any information that may shine light on any deficiencies
in your compliance program. Self-identified deficiencies may be treated differently by your regulator. Each regulator releases enforcement
actions and it is highly recommended to register your email address for
news alerts with each agency. Listed below are steps to take in analyzing
enforcement actions:
▶▶What specific laws and/or regulations were involved?
▶▶If available, what violations of law created the action?
▶▶Were the actions taken by the financial institution that led to the
enforcement action willful neglect?
▶▶Were consumers harmed and how?
▶▶What compliance program deficiencies were noted? Look for any
of the following findings:
›› Deficient compliance management systems
▶▶Make sure your compliance program for
consumer compliance and BSA/AML is
strong:
›› Have you completed or have in place
updated risk assessments for appropriate
areas, such as BSA/AML, overall
compliance management, fair lending,
UDAAP, service providers/third-party
relationships?
▶▶Maintain strong internal controls and
monitoring systems (manual or automated)
that allows for early identification of risks
or other issues. Central to strong internal
controls are strong policies, procedures and
practices. ‘Strong’ is repeatedly emphasized
here for a reason!
▶▶Utilize your internal audit function which
allows you to continuously monitor the
bank’s condition and your compliance
program. In conjunction, what do external
audits reveal? Make sure to immediately
address any issues identified by internal and/
or external auditors. Self-identified issues are
less costly to correct, especially compared
to costs involved with formal enforcement
actions and your reputation may be spared.
▶▶Should any deficiencies be discovered by
›› Inadequate internal controls
regulators, address those issues promptly.
›› Insufficient monitoring
▶▶While it appears that the economy continues
›› Ineffective policies, procedures and practices
›› Deceptive marketing practices
›› Discrimination
›› Inadequate due diligence and oversight of third parties/service
providers
›› Deficient internal audit function
›› Lack of staff/employee training
›› Insufficient consumer complaint process
▶▶What steps are required to correct the compliance program
deficiencies?
What preventative measures can you take to avoid the spotlight of a
formal enforcement action?
As the saying goes ‘an apple a day keeps the doctor away’. The same is
true here. Acting with diligence in maintaining a compliant compliance
CHARTWELL COMPASS | MAY 2014
program goes along way. While the following list
is not exclusive, consider these tips of prevention:
16
to recover, regulators will maintain their
vigilance by utilizing all enforcement tools
to enforce rules and regulations. Maintain
a system of sound governance, a strong
compliance management system, and strong
internal controls.
Jill Emerson has worked in AML Compliance in the financial services industry for
over 20 years. She directed the compliance
and BSA functions of several community banks – conducting independent reviews, identifying weaknesses
and potential high-risk areas for compliance violations
and utilizing automated BSA software to detect and
monitor for suspicious activity as well as meeting regulatory reporting requirements.
CHARTWELLCOMPLIANCE.COM
Financial Industry Regulatory
Compliance: A New Era of
Government Enforcement
Jeffrey B. Coopersmith and Ashley L. Watkins, Davis Wright Tremaine LLP
Recent enforcement efforts by the Department of Justice (DOJ) have shifted focus
from the 2008 financial crisis to alleged involvement by banks in aiding criminal activity committed by bank customers, such as
consumer fraud schemes.
Under the Bank Secrecy Act (BSA), all
banks are required to establish and maintain effective internal compliance programs
to prevent fraud and other illegal uses of the
banking system by customers. See 31 U.S.C.
§5311, et seq. The program must contain
certain anti-money laundering checks to
prevent such diverse harms as international
wire fraud, improper payday loan lending practices, and theft via unauthorized
ACH debits. Under the banner of fraudprevention, the Department of Justice has
embarked on aggressive enforcement initiatives against financial services providers for
perceived failures in compliance with BSA
requirements. A recent complaint and consent order
filed by the DOJ in North Carolina against
Four Oaks Bank & Trust Company illustrates this trend. Under “Operation Choke
Point,” a sweeping, multiagency enforcement initiative targeting banks and other financial institutions that serve online payday
lenders, the DOJ is investigating scores of
financial institutions. The Operation Choke
Point name reflects the DOJ’s stated goal of
preventing fraud by cutting off perpetrators
of fraud from access to the banking system. The Four Oaks case, the first publicized
action by the DOJ under Operation Choke
Point, involved a civil enforcement action brought by DOJ accusing Four Oaks
of turning a blind eye to wire fraud being
committed by a customer who processed
payments for payday lenders engaged in
CHARTWELL COMPASS | MAY 2014
defrauding consumers. Four Oaks settled
and paid over $1 million in penalties. In another recent, and very high-profile,
case, the DOJ brought a criminal action
against JP Morgan Chase based on Chase’s
banking relationship with the Ponzi schemer Bernie Madoff. The case resulted in a deferred prosecution agreement and the payment of over $2 billion in penalties by the
bank. See http://www.dwt.com/QuarterlySecurities-Enforcement-Briefing-01-212014/#Largest (last article). The tentacles of the DOJ, including
through Operation Choke Point, have also
reached non-bank financial services companies -- for example, Western Union recently revealed that it is being investigated
by the U.S. government for failing to properly monitor and prevent fraudulent wire
transfers to third parties. The DOJ has also
targeted the bank customers themselves,
particularly online payday lenders and payment processors. Because it is the rare bank or financial institution that intentionally aids a customer
in committing consumer fraud or other
criminal conduct, the DOJ has relied on a
variety of more subtle evidence. For example, the lack of proper licensing by a third
party payment processor, or the processor’s
merchants, might be considered a “red flag”
viewed by the DOJ as creating an inference
that the bank looked the other way at fraud
being committed by a customer. Thus, in
its complaint against Four Oaks, the DOJ
stated that certain merchants for whom the
third party payment processor processed
payments were unlicensed, and this fact
should have tipped the bank off that the
processor may have been operating illegally. Due diligence gaps or a lack of attention
17
to anything that could be viewed later as a
red flag -- things that may once have been
viewed as indicative of negligence, at the
most -- may now be viewed by the DOJ as
evidence of complicity by banks in their
customers’ criminal conduct. And, as a
practical matter, the DOJ may look at a
bank’s compliance program with the benefit of hindsight to judge what more could
have been done to detect and prevent fraud. Banks today are expected to not only thoroughly know their customers, but also to
know their customers’ customers.
When banks fall short of the government’s very high expectations, the government has a variety of enforcement tools at
its disposal. The DOJ can bring criminal
cases against banks, which may result in
convictions at trial (although trials are rare
in this area), guilty pleas, or deferred prosecution agreements. The DOJ can bring civil
enforcement actions under the Financial
Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), which is what
happened in the Four Oaks case. Regulators such as the OCC, the Federal Reserve,
FinCEN, the FDIC, and state banking agencies may also impose fines and compliance
remedies. Both criminal and civil enforcement actions can result in large financial penalties and court-ordered compliance plans,
among other things. The government’s increasing use of these tools should make all
banks and financial institutions particularly
vigilant when on-boarding and monitoring
customer accounts. Mr. Coopersmith is a partner at Davis
Wright Tremaine and a former federal
prosecutor who defends and investigates
civil and criminal white-collar cases and
matters in the financial services and other
industry sectors. He frequently represents
and advises clients in Bank Secrecy Act/
AML compliance and enforcement matters.
Mr. Coopersmith practices out of DWT’s
Seattle and Los Angeles offices and can be
reached at [email protected].
Ms. Watkins is an associate in the firm’s
Portland office who focuses her practice on
complex litigation, including white-collar
defense and investigations. She can be
reached at [email protected].
CHARTWELLCOMPLIANCE.COM
Representative Engagements
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
▶▶Regulation AA: Unfair or Deceptive Acts or Practices Act
▶▶Regulation BB: Community Reinvestment Act
▶▶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
CHARTWELL COMPASS | MAY 2014
18
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.
BSA/AML
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.
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.
CHARTWELLCOMPLIANCE.COM
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 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.
CHARTWELL COMPASS | MAY 2014
19
Representative Engagements
Chartwell was hired on one day’s
advance notice by a publicly traded
financial institution software business to provide a full-day crashcourse on the regulatory compliance
framework for money services businesses. The engagement helped the
customer win a major AML software
deal, and to subsequently hire Chartwell again.
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.
CHARTWELLCOMPLIANCE.COM
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 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 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.
Enroll Today
Visit: chartwellcompliance.com/icbahelpdesk/
Email: [email protected]
Call: 1.800.541.6744
CHARTWELL COMPASS | MAY 2014
20
CHARTWELLCOMPLIANCE.COM
Chartwell Compliance Shows You the Way
“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 COMPASS | MAY 2014
hartwell Compliance offers all-in-one integrated regulatory
C
compliance and risk management consulting, testing,
audit and examinations, and outsourcing services. We serve
bank and non-bank financial service providers 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.
21
CHARTWELLCOMPLIANCE.COM
Value Propositions
Chartwell Consultants
▶▶One of the best 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 industry’s foremost authorities on regulatory compliance, information security,
licensing, and fraud such as:
AML/CFT, Financial
Crimes and state license consultancies in the world
▶▶One of North America’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.
▶▶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,
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
CHARTWELL COMPASS | MAY 2014
22
CHARTWELLCOMPLIANCE.COM
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.
CHARTWELL COMPASS | MAY 2014
23
CHARTWELLCOMPLIANCE.COM
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:
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.
With its finger on the pulse of the financial services, real estate
and IT industries, OnCourse Learning provides best-in-class
education and compliance solutions that help people get started
and succeed in their chosen professions.
Consistently ranked as number one in the space, NICE
Actimize experts apply innovative technology to protect
institutions and safeguard consumers and investors assets by
identifying financial crime, preventing fraud and providing
regulatory compliance.
First Manhattan Consulting Group provides strategy, risk
management, and marketing services to financial institutions
across the globe
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.
CHARTWELL COMPASS | MAY 2014
24
chArtwe ll coMPliA
nce | eDition
1
APRIL 2012
Welcome to the inau
W
gural edition of Char
elcome to the inaugura
l edition of the Chartwel
Compliance “Compas
s”, our periodic publicatio l
about financial
n
financial crime preventio institution regulatory compliance,
n, and risk managem
contributors are dedicated
ent issues. The
to ensuring our
practical, real-worl
d view of a wide range readers have a
may have an effect
of subjects which
on the operations
of their businesses.
goal is to provide
Our
updates, analysis
and recommendations
that enable you to
stay attuned with
new
emerging trends,
deter fraud and money regulations and
attain compliance
laundering, and
in practical ways in
order to help maintain
fee revenue, lower
costs, and address
the recommendations
your federal and state
of
regulators.
In ThIs Issue
Fiserv, Inc. (NASDAQ: FISV) is the leading global provider of
information management and electronic commerce systems for
the financial services industry.
CHARTWELL COMPASS
A PublicAt ion of
twell Compass
The professionals at
Chartwell are a team
eraging 30 years of
of
experience with backgrou individuals, avexaminers, enforcem
nds of bankers,
ent directors, law
enforcement officers,
security and fraud
specialists, and licensing
hope you find the
specialists. We
information useful
and we welcome your
suggestions for topics
you would like to see
well Compliance looks
addressed. Chartforward to meeting
all of your compliance and licensing
needs.
Daniel Weiss
President and CEO
Chartwell Complian
ce
Fraud and Money
Laundering: Can You
Think Like a Bad
Nationwide Mortga
Guy? | Expansion
ge Licensing System
of the
and Registry (NMLS)
Changes and Revisio
| Important Recent
ns for the Financi
al Services Industr
Force | Chartwell
y by the Financial
Compliance Conund
Action Task
rum | Director Liability
Prepare Yourself for
Renewe
Your Next Exam: Bank
of Foreign Assets
Secrecy Act/Anti-Money d | Checklist:
Control (BSA/AML/OFA
Laundering/Office
C) | About Chartwe
ll Compliance
Request your complementary
digital subscription of
Chartwell Compass today at
info@chartwellcompliance.
com and start receiving the
latest on financial institution
regulatory compliance,
financial crime prevention,
and risk management issues.
Chartwell grants permission
to all subscribers to freely
distribute this publication.
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chartwellcompliance.com
Chartwell Compass is intended to provide
education and general information on regulatory
compliance, reasonable management practices
and corresponding legal issues. This publication
does not attempt to offer solutions to individual
problems and the content is not offered as legal
advice. Questions concerning individual legal issues
should be addressed to the attorney of your choice.
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