On June 13, 2019, the FDIC released its first edition of Consumer Compliance Supervisory Highlights, the purpose of which is to increase transparency regarding the FDIC’s consumer compliance supervisory activities. The publication provides a high-level overview of the consumer compliance issues identified through approximately 1,200 consumer compliance examinations conducted in 2018 for non-member state-chartered banks and thrifts.
In describing these supervisory highlights, the FDIC noted that 98% of all FDIC-supervised institutions were rated satisfactory or better for consumer compliance. However, the FDIC brought 21 consumer compliance-related formal enforcement actions that included civil money penalties totaling approximately $3.5 million. The institutions subject to these formal enforcement actions paid approximately $18.1 million in required restitution and $4 million in voluntary restitution. The most frequently cited violations in 2018 included the Truth in Lending Act (Regulation Z), the Truth in Savings Act (Regulation DD), Electronic Funds Transfer (Regulation E), the Flood Disaster Protection Act, and the Equal Credit Opportunity Act/Regulation B.
In the publication, the FDIC discusses a number of areas in which it has found violations, including overdraft programs (unfair and deceptive acts or practices), mortgage loan referral payments to third parties (RESPA), electronic fund transfers (Regulation E), skip-a-payment loan programs (unfair or deceptive acts or practices), and finance charges and annual percentage rate (“APR”) calculations (Regulation Z). These findings are described below. In addition, the publication includes summaries of actions taken to mitigate the risks of violations.
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