Compliance Insights compliance-newsletter-march-2020 | Page 11

Regulatory HMDA • • Requirements are overly burdensome and costly. • Additional HMDA data elements needing to be collected can result in increased reporting errors and additional staff time devoted to data collection. • • Excessive cost of compliance not being offset by increases in revenue. HMDA reporting requirements making it challenging for banks to increase their mortgage lending activities. Rules and regulations negatively impacting community banks because they were written for large banks, ultimately making it harder to improve profitability. TRID • • • Disclosure requirements being costly, resulting in a large volume of paperwork, confusing to consumers and ultimately impacting mortgage profitability. Qualified mortgage-rule restrictions (debt-to-income limitation) making it challenging to fund purchase money residential mortgages. Ensuring adequate and consistent compliance training for staff. BSA • Beneficial ownership rules being too complex and burdensome on staff and customers, as well as costly and delaying the opening of accounts. This puts institutions in a position of “policing” customers’ behavior. • • Beneficial ownership rules are onerous to small community banks that already know their customers and have customer identification procedures in place. • Potential for HMDA requirements becoming applicable to certain commercial loans. Marijuana • The need for greater transparency in examination procedures regarding marijuana-related businesses. • Clearer regulatory guidance and expectations are needed to aid institutions in determining whether to provide services to cannabis or industrial hemp- related customers. • Conflicting state and federal laws resulting in BSA requirements becoming taxing. After regulatory issues, the next biggest topic of interest was examination issues, more specifically consumer compliance and BSA. The Ombudsman Office is assuming the lead role in soliciting post- examination survey responses after each consumer compliance examination conducted by FDIC examiners. lll Topics of Interest Breakdown 26% Regulatory Burden 16% Truth in Lending and Real Estate Settlement Procedures Act (TRID) 15% Bank Secrecy Act (BSA) 7% Home Mortgage Disclosure Act (HMDA) 5% Marijuana 31% Non-Compliance Items The $10,000 threshold for Currency Transaction Reports is outdated and should be increased. 11