Credit Union Regulatory Guidance Including: NCUA, CFPB, FDIC, OCC, FFIEC

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n this episode of Samantha Shares, we present the verbatim text of the N C U A’s proposed rule on  Elimination of Reputation Risk.

The document covers:

• A Summary of the proposed rule to eliminate reputation risk from N C U A’s supervisory framework.
• Background and Policy Objectives — why reputation risk is subjective, inconsistent, and prone to examiner bias.
• Legal Authority — the Federal Credit Union Act provisions that give N C U A power to regulate.
• Description of the Proposed Rule and Changes — prohibiting examiners from citing, criticizing, or taking action against credit unions for reputation risk, including political, cultural, or religious reasons.
• Expected Effects — how this will affect all 4,370 federally insured credit unions, their members, and business partners.
• Regulatory Procedures — transparency, cost analysis, and references to Executive Orders and statutory requirements.

The proposal directly addresses concerns that reputation risk was being misused in examinations, particularly around politically sensitive or lawful but disfavored activities.

This audiobook-style episode presents the full Federal Register text as released, unedited and verbatim, for educational purposes.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Hello, this is Samantha Shares. This episode covers the Fair Credit Reporting Act; Preemption of State Laws. The following is an audio version of that document. This podcast is educational and is not legal advice. We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and forty years of National Credit Union Administration experience. We assist our clients with N C U A so they save time and money. If you are worried about a recent, upcoming, or in-process N C U A examination, reach out to learn how they can assist at Mark Treichel DOT COM. Also check out our other podcast called With Flying Colors, where we provide tips on how to achieve success with N C U A. And now, the Fair Credit Reporting Act; Preemption of State Laws.

The Consumer Financial Protection Bureau is issuing this interpretive rule to clarify that the Fair Credit Reporting Act broadly preempts state laws that attempt to regulate credit reporting. This action reflects Congress’s original intent to create national standards for the credit reporting system. This interpretive rule replaces an earlier Bureau rule from July twenty twenty-two, which had taken a narrower view of preemption. That rule was withdrawn in May twenty twenty-five.

The Fair Credit Reporting Act, or F C R A, was enacted in nineteen seventy and has been amended several times since. It established a national system for credit reporting and set rules for consumer reports and the use of consumer information. From the beginning, the law preempted state laws that were inconsistent with its provisions. In nineteen ninety-six, Congress strengthened this preemption by adding a new clause that barred states from regulating in certain specifically identified areas. This was meant to avoid a patchwork of conflicting rules. Originally, this stronger preemption was set to expire in two thousand four, but in two thousand three, Congress made it permanent. The intent was clear: to preserve uniform national standards and support the growth of the national credit reporting system.

In July twenty twenty-two, the Bureau published an interpretive rule suggesting that section sixteen eighty-one tee, subsection b, paragraph one, had only a narrow sweep. It concluded that many state laws affecting consumer reports could stand alongside federal law. For example, it suggested that state laws regulating medical debt, rental history, or arrest records could coexist with the F C R A. That interpretation was controversial. In May twenty twenty-five, the Bureau withdrew that interpretive rule, stating that it was unnecessary and that agencies lack special authority to interpret preemption unless Congress specifically delegates it. The Bureau also found that the twenty twenty-two rule created confusion and risked imposing higher compliance burdens. The Bureau now clarifies that the prior interpretation was flawed. The F C R A’s preemption clause was written in broad terms and must be applied broadly.

The text of section sixteen eighty-one tee, subsection b, paragraph one, uses sweeping language: “No requirement or prohibition may be imposed under the laws of any State with respect to any subject matter regulated under” certain provisions of the Act. Congress deliberately used expansive phrases like “no requirement or prohibition,” “with respect to,” and “relating to.” Read together, these show that Congress meant to occupy the field of consumer reporting.

The legislative history supports this interpretation. In the nineteen ninety-six amendments, lawmakers stressed the need for a uniform national credit system. In two thousand three, Congress decided to make preemption permanent, concluding that the national credit reporting system had expanded access to credit, lowered costs, and accelerated decisions. Allowing states to impose their own requirements would fracture the system, increase compliance costs, and undermine the usefulness of credit reports. Consumers would no longer be able to take their credit history with them as they moved, and lenders would struggle to compare creditworthiness across state lines.

The Bureau emphasizes that state laws attempting to regulate core areas of credit reporting—such as prescreening, dispute procedures, adverse action notices, or the content of consumer reports—are preempted. State efforts to ban certain categories of information, such as medical debt or rental arrears, are also preempted. The Bureau explains that rules about how long information may remain on a report and whether it may appear in the first place are points on the same continuum. Allowing states to prohibit categories outright would contradict Congress’s intent.

For the financial services industry, the rule restores clarity. Credit bureaus, lenders, and providers of consumer information can look to federal law as the governing standard without having to reconcile fifty different state regimes. For consumers, the effects are mixed. A national standard supports broader access to credit and ensures consistency. But some advocates will argue that state-level protections, particularly around medical debt, are now off the table.

This interpretive rule is guidance. It does not have the force of law. Courts remain the final arbiters of preemption questions. Still, the Bureau’s position is clear: Congress intended broad federal preemption under the Fair Credit Reporting Act, and the national credit reporting system depends on it.

This concludes the Fair Credit Reporting Act; Preemption of State Laws. If your credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at Mark Treichel DOT COM. This is Samantha Shares, and we thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

www.marktreichel.com

https://www.linkedin.com/in/mark-treichel/

Hello, this is Samantha Shares. This episode covers Frequently Asked Questions.

The following is an audio version of that document. This podcast is educational and is not legal advice. We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and forty years of National Credit Union Administration experience. We assist our clients with N C U A so they save time and money. If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel dot com. Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now the Frequently Asked Questions Regarding Suspicious Activity Reporting Requirements. October 3, 2005.

The Financial Crimes Enforcement Network, jointly with the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision, is issuing interpretive guidance in response to questions received regarding the filing of Suspicious Activity Reports. The purpose of this guidance is to clarify the regulatory expectations and requirements for financial institutions with respect to the reporting of suspicious activity. Financial institutions are reminded that Suspicious Activity Reports are one of the most important sources of information available to law enforcement and regulatory agencies for detecting financial crime, and are used in a wide range of investigations and enforcement actions. Below are answers to frequently asked questions regarding suspicious activity reporting requirements.

Question 1: S A R Filings for Potential Structuring related Activity.

Is a financial institution required to file a S A R for transactions or a series of transactions in which a person or persons are structuring transactions to avoid the C T R threshold, even though the total amount of currency involved does not exceed ten thousand dollars?

Yes. The mere purpose of structuring is evidence of suspicious activity regardless of the amount. If one person or two or more persons act together to break up currency transactions to avoid the ten thousand dollar C T R threshold, then information sufficient to identify the activity should be reported on a S A R. For example, if an individual conducts multiple cash deposits of nine thousand five hundred dollars or less into different accounts to evade a C T R, the financial institution is required to file a S A R.

A financial institution is required to file a S A R for a transaction conducted or attempted by, at, or through the institution if it involves or aggregates at least five thousand dollars in funds or other assets, and the institution knows, suspects, or has reason to suspect that the transaction: One, involves funds derived from illegal activities or is intended to hide or disguise funds from illegal activities. Two, is designed to evade Bank Secrecy Act requirements, such as structuring to avoid a C T R. Three, has no business or apparent lawful purpose.

FinCEN has consistently advised that financial institutions must file S A R s for structuring even when the total amount of currency is less than ten thousand dollars. Under FinCEN guidance, structuring transactions to evade reporting requirements is suspicious in and of itself and must be reported.

Financial institutions should not ignore structuring simply because the total amount falls below the C T R threshold. The fact that the amount is below ten thousand dollars does not eliminate the obligation to file a S A R.

Question 2: Continuing Activity Reviews.

Is a financial institution required to conduct a review of a customer or account following the filing of a S A R to determine whether suspicious activity has continued?

Yes. Recognizing that suspicious conduct does not end once an initial S A R is filed, FinCEN guidance issued in October two thousand advised that institutions must review their S A R filings to determine whether additional S A R s should be filed.

The continuing review should determine whether suspicious activity has persisted and whether further S A R s are warranted. Institutions are required to file continuing activity S A R s no later than ninety days after the date of the previously related S A R filing, if suspicious activity continues.

Financial institutions must establish policies and procedures to identify and report ongoing suspicious activity. Institutions are expected to document reviews conducted and provide the rationale for whether a subsequent S A R is necessary.

Question 3: Continuing Activity Reviews – Timeline.

What is the timeline for a financial institution that elects to file S A R s in accordance with FinCEN’s continuing suspicious activity guidance?

As noted in prior F A Qs, FinCEN previously recommended that financial institutions report continuing suspicious activity with a new S A R filing at least every ninety days. Subsequent S A R s must be filed no later than one hundred and twenty calendar days after the date of the initial S A R.

The standard timeline is: Day one: Date of suspicious activity detection, begin review. Day thirty: File initial S A R. Day ninety: Review whether suspicious activity continues. Day one hundred and twenty: File continuing S A R if necessary.

This timeline ensures that law enforcement is kept informed of continued suspicious activity. Institutions must maintain procedures that identify and escalate potential continuing suspicious conduct to compliance officers responsible for S A R decision-making.

Question 4: No S A R Documentation.

Is a financial institution required to document the decision not to file a S A R?

Yes. There is no requirement or regulation that requires an institution to document its reasons for not filing a S A R. However, FinCEN has stated that financial institutions should maintain sufficient documentation to support the rationale for their decision not to file.

This documentation should be retained in accordance with the institution’s internal policies and record retention requirements, and must be available to examiners and law enforcement upon request.

Outro. This concludes the document.

If your Credit Union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at Mark Treichel dot com. This is Samantha Shares and we thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA ...

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Hello, this is Samantha Shares. This episode covers Chairman Hauptman on Regulation by Enforcement.

The following is an audio version of that document. This podcast is educational and is not legal advice. We are sponsored by Credit Union Exam Solutions Incorporated, whose team has over two hundred and forty years of National Credit Union Administration experience. We assist our clients with N C U A so they save time and money. If you are worried about a recent, upcoming or in process N C U A examination, reach out to learn how they can assist at Mark Treichel dot com. Also check out our other podcast called With Flying Colors where we provide tips on how to achieve success with N C U A.

And now the document.

Chairman Hauptman On Regulation by Enforcement

ALEXANDRIA, VA, October 1, 2025 – The National Credit Union Administration Chairman Kyle S. Hauptman issued the following statement about N C U A’s No Regulation-by-Enforcement Policy:

Today’s policy statement fulfills a goal listed back in January upon being designated as Chairman: “Codifying our procedures to protect Americans from regulation-by-enforcement. For example, no enforcement action should ever set―or even clarify― policy. In America and other free societies, the sequence is: set speed limits, then give speeding tickets (no one has any obligation to be aware of someone else’s ticket).”

To be clear, this agency has a good track record regarding regulation-by-enforcement, so this statement shouldn’t be viewed as being the result of any recent N C U A actions. After all, it’s counterproductive for a deposit insurer to engage in regulation-by-enforcement against the same institutions we insure. That said, it’s important to put in writing a policy of fairness, whereby government employees give regulated credit unions the same due-process that they, under civil servant protections, rightly expect in their own careers. Today’s statement is born partly of my frustrating interactions with regulators, both in my time on Capitol Hill and in the private sector. I know that millions of others share the frustration of being told ‘if you want to figure out the rules, look at our prior settlements.’ Americans expect better from their government, including financial regulators.

No Regulation-by-Enforcement Policy Statement

Regulation-by-enforcement is unethical and not permitted at N C U A.

Enforcement actions shall only occur in the case of clear and significant violations of law or regulation. Therefore, no person or entity regulated by N C U A has any obligation to be aware of any prior N C U A enforcement actions because no new policy is ever set via an enforcement action.

No enforcement action, nor the timing of enforcement actions, shall be motivated by trying to boost the agency’s enforcement totals or get the enforcement done in a certain fiscal or calendar year.

Enforcement is a necessary tool, but is not, by itself, an accomplishment or a metric of success. Our goal is for credit unions to operate safely and soundly and in compliance with applicable laws and regulations. We will seek to remedy any such problems whenever we can without needing to use enforcement action. The goal is to resolve any problems, not to issue press releases, rack up enforcement numbers or improve the post-N C U A career options of agency staff. We don’t set “speed traps” to increase enforcement totals.

A guiding principle here is avoiding double-standards. In their own careers, civil servants are protected against arbitrarily poor performance reviews, allegations of misconduct, wrongful termination and other things that could harm their career path. In turn, government employees must extend the same due process protections to those they regulate.

If N C U A finds a harmful practice that threatens our mission or is otherwise injurious or abusive, and it is not currently addressed by law or regulation, then our next step is to consider rulemaking or other remedy. As is the norm in America, the sequence of events at N C U A is: one, publish rules, two, then and only then, enforce them.

This concludes the document.

If your credit union could use assistance with your exam, reach out to Mark Treichel on LinkedIn, or at Mark Treichel dot com. This is Samantha Shares and we thank you for listening.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

Take a Cruise with CUES and With Flying Colors!

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 N C U A Discontinues Risk Ratings and Reputational Risk

Show Notes
In this episode, Samantha Shares provides an audio version of the recent N C U A communications announcing the discontinuation of risk ratings and the elimination of reputational risk in credit union examinations.

In early September, N C U A emailed CEOs and Board Chairs that it would stop using individual risk ratings for categories like Credit, Liquidity, and Strategic risk. Later that month, the agency issued a press release confirming it would no longer use reputational risk or equivalent concepts, in line with White House Executive Order Fourteen Three Three One.

Listeners will hear the original text of these letters and announcements, voiced audiobook-style, without added commentary. This principle-based guidance is designed to streamline examinations, reduce duplicative scoring, and focus examiner attention on material issues reflected in CAMELS ratings.

Key points covered in the episode include:

• The removal of duplicative risk ratings for the seven traditional risk categories.
• Confirmation that N C U A examiners will still assess risk, but only in the context of CAMELS ratings.
• The elimination of reputational risk as a supervisory concept.
• Clarification that issues such as litigation exposure or insider abuse will still be reviewed under material financial impact.
• An emphasis on more streamlined examination reports and communications with credit unions.

This audiobook-style presentation is intended as an educational resource for credit union leaders and boards.

Disclaimer
This podcast is educational and is not legal advice.

Sponsor Message
Credit Union Exam Solutions Incorporated provides consulting support from a team with more than two hundred and forty years of N C U A experience. If your credit union is preparing for or undergoing an N C U A exam, visit MarkTreichel.com to learn more.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

www.marktreichel.com

https://www.linkedin.com/in/mark-treichel/

Tips on Starting an Exam Efficiently

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Show Notes: OCC Semiannual Risk Perspective Spring 2025

Episode Overview

This episode covers the Office of the Comptroller of the Currency's Semiannual Risk Perspective for Spring 2025, providing valuable insights for credit unions on key banking risks and industry trends.

Key Topics Covered

Federal Banking System Key Themes

• Overall system strength remains sound despite economic uncertainty
• Commercial credit risk increasing due to geopolitical risks and sustained higher interest rates
• Retail credit risk stable but consumer sentiment declining
• Market and liquidity risk stable with improved net interest margins
• Operational risk elevated due to cyber threats and digitalization challenges
• Compliance risk remains elevated

Economic Operating Environment

• Global: Slow growth forecast for 2025, trade policy uncertainty, geopolitical tensions
• Domestic: GDP 12% above pre-pandemic peak, unemployment at 4.2%, but economic uncertainty growing
• Projections: 1.2% growth in 2025, 1.3% in 2026; PCE inflation expected to reach 3.6% by Q3 2025

Credit Risk Insights

Commercial Credit

• CRE market conditions vary by property type
• Office vacancies projected to continue rising into 2026
• Multifamily market expected to stabilize later in 2025
• Refinance risk high for loans underwritten during low-rate periods
• Trade disruptions may compress industry margins

Retail Credit

• Delinquency rates manageable but trending upward
• Consumer payment prioritization favoring low-rate mortgages
• Tighter lending standards across consumer categories
• Natural disaster impacts on insurance and collateral administration

Market Risk

• Net interest margins improved in second half of 2024
• Unrealized investment losses remain a concern
• 10-year Treasury yield volatility affecting portfolio values
• Interest rate risk scenario testing critical given uncertainty

Operational Risk

Cybersecurity

• Continued targeting by threat actors with ransomware
• Increase in "double extortion" attacks
• ATM jackpotting attempts rising
• Third-party dependencies creating single points of failure

Innovation & Technology

• Cautious AI adoption with focus on fraud detection and credit underwriting
• Legacy system challenges amid digitalization demands
• New OCC guidance on crypto-asset activities (IL 1183 and IL 1184)
• Board oversight responsibilities for new technologies

Fraud Risk Management

• Traditional payment methods still targeted
• Social engineering and phishing schemes prevalent
• First-party fraud and insider abuse concerns
• Importance of customer education and staff training

Compliance Risk

BSA/AML and OFAC

• Elevated fraud levels increasing SAR filing obligations
• Fintech partnerships may lack adequate compliance resources
• Corporate Transparency Act requirements removed for US companies
• Need for continued CDD rule compliance

Consumer Compliance

• Investigation and resolution timeframes critical
• New deposit products requiring clear communications
• Rising insurance premiums affecting flood insurance compliance

Bank Performance

• Return on equity stable at 11.7% for federal banking system
• Net interest income growth slowed due to funding costs
• Loan growth weak at 1.6%, driven by C&I loan declines
• Balance sheet positioning may benefit from future rate cuts
• Net charge-off rates historically strong despite slight increases

Key Statistics

• Federal banking system liquid assets: 31% of total assets (vs. 16% in 2008)
• Employment: 5.5 million above pre-pandemic peak
• Unemployment rate: 4.2%
• Q1 2025 job creation: 177,000
• Federal banking system loan growth: 1.6%
• Deposit growth: 1.6%

Important Dates & Regulatory Updates

• March 7, 2025: OCC issued IL 1183 on crypto-asset activities
• May 7, 2025: OCC issued IL 1184 on crypto-asset custody services
• March 2025: Treasury removed beneficial ownership reporting requirements
• September 2024: Federal Reserve began rate cuts (100 basis points total)

Credit Union Applications

While this report focuses on OCC-supervised institutions, the principle-based guidance provides excellent insights for credit unions to:

• Assess similar risk exposures
• Benchmark risk management practices
• Prepare for evolving regulatory expectations
• Understand industry-wide trends affecting the financial sector

Sponsor Information

Credit Union Exam Solutions LLC

• Over 240 years of combined NCUA experience
• Assists credit unions with NCUA examinations
• Contact: Mark Treichel at MarkTreichel.com
• LinkedIn: Mark Treichel

Related Resources

• OCC Bulletin 2017-43: "New, Modified, or Expanded Bank Products and Services"
• OCC Bulletin 2023-17: "Third-Party Relationships: Interagency Guidance"
• OCC Bulletin 2019-37: "Operational Risk: Fraud Risk Management Principles"
• With Flying Colors Podcast: NCUA examination tips and strategies

This podcast is educational and is not legal advice. Content reflects conditions as of December 31, 2024, unless otherwise noted.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

www.marktreichel.com

https://www.linkedin.com/in/mark-treichel/

Show Notes: FDIC Consumer Compliance Supervisory Highlights - July 2025

Episode Summary

In this episode, we break down the FDIC's latest Consumer Compliance Supervisory Highlights report, covering 2024 examination results and compliance trends. While focused on FDIC-supervised institutions, this principle-based guidance serves as an excellent roadmap for credit unions and all financial institutions.

Key Takeaways

Overall Performance

• 97% of FDIC-supervised institutions rated satisfactory or better for consumer compliance
• 800 consumer compliance examinations conducted in 2024
• Risk-focused examination approach targets areas with greatest potential for consumer harm

Top 5 Most Cited Violations (73% of all violations)

1. Truth in Lending Act (TILA) - 470 violations (37%)
   • Periodic statement disclosure failures
   • Good faith estimate timing issues
   • Loan cost breakdown requirements
2. Flood Disaster Protection Act (FDPA) - 143 violations (11%)
   • Failure to provide required flood insurance
   • 45% of FDPA violations related to this single issue
3. Truth in Savings Act (TISA) - 129 violations (10%)
   • Inadequate deposit account disclosures
   • Pre-opening disclosure failures
4. Electronic Fund Transfer Act (EFTA) - 122 violations (10%)
   • Error investigation procedure failures
   • Timing and reporting requirement violations
5. Home Mortgage Disclosure Act (HMDA) - 65 violations (5%)
   • Incomplete data collection and reporting
   • Missing required borrower and loan information

Enforcement Actions & Restitution

• 31 formal and 23 informal enforcement actions
• $5.6 million in civil money penalties
• $33.3 million in voluntary restitution to ~400,000 consumers
• 3 referrals to Department of Justice for discrimination violations

Consumer Complaint Trends

• 26,451 complaints closed (14% increase from 2023)
• 100% acknowledgment within 14 days
• 98.6% response rate within performance goals

Top Complaint Categories:

• Credit cards: 4,733 complaints (29%)
• Checking accounts: 3,152 complaints (19%)
• Installment loans/CLOC: 2,708 complaints (12%)
• Residential real estate: 844 complaints (5%)

Most Common Issues:

• Credit reporting disputes (18%)
• Transaction errors (9%)
• Accounts opened without knowledge (6%)
• Disclosure problems (6%)
• Service availability issues (5%)

Emerging Trends

• 13% increase in third-party provider-related complaints (4,282 cases)
• Growing vendor oversight challenges
• Persistent credit reporting and account opening issues
• Fair lending complaints decreased 9% (68 to 62 cases)

Key Compliance Areas for Focus

High-Risk Areas

• Disclosure Management: TILA, TISA, and HMDA reporting accuracy
• Operational Procedures: Flood insurance, error resolution processes
• Vendor Oversight: Third-party provider compliance monitoring
• Data Collection: HMDA and other regulatory reporting requirements

Proactive Strategies

• Implement robust disclosure review processes
• Enhance staff training on operational compliance
• Strengthen vendor management programs
• Monitor complaint trends as early warning indicators

Why This Matters for Credit Unions

While this report focuses on FDIC-supervised banks, the consumer protection laws and compliance principles apply broadly across financial services. Credit unions can use these insights to:

• Benchmark their compliance performance
• Identify potential risk areas before they become problems
• Enhance training and procedures in high-violation areas
• Improve vendor management practices

Resources Mentioned

• FDIC Consumer Compliance Examination Manual
• Federal Financial Institutions Examination Council (FFIEC) Rating System
• FDIC National Center for Consumer and Depositor Assistance

Host Notes

This episode provides actionable insights for compliance professionals, with extensive use of direct quotes from the FDIC report to ensure accuracy. The data shows that while most institutions are performing well, concentrated issues in specific areas offer clear opportunities for improvement across the industry.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.

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Hello, this is Samantha Shares. This podcast is educational and is not legal advice.

Banking agencies have curtailed issuance of new guidance and regulations under the current administration. As a result, and to continue providing our listeners with valuable new episodes, we're excited to share our new initiative and cohost. We'll be providing AI-powered summaries of evergreen episodes from our sister podcast With Flying Colors. These episodes will highlight the key points in an easy-to-digest eight to twelve minute format.

We continue to embrace Artificial Intelligence, and like my voice, these new episodes will be introduced by me and then narrated by our guest AI voice. Today, Daniel will discuss 'NCUA Exam Alert: Risk Management Framework Essentials That Pass Exams.' This episode is also available on YouTube in AI video format, so be sure to check that out as well!

Now, here's Daniel with your summary.

Are you worried about an NCUA exam in process or looming on the horizon? Don't face it alone!

We're ex-NCUA insiders with decades of experience, ready to guide you to success. Our team understands the intricacies of NCUA examinations from the inside out.

Hire us and gain:

• Peace of mind during your exam process

• Insider knowledge of NCUA procedures and expectations

• Strategies to address potential issues before they become problems

• Continuous access to our extensive subject matter expertise

With our access retainer, you'll have on-demand support from former NCUA experts. We're here to ensure your credit union achieves flying colors in its next examination.

Contact Credit Union Exam Solutions today to learn more about our services and how we can help your credit union succeed.