ABA Compliance Committee Report
 Michael A. Olson, Community Bank President of US Bank in Pella and New Sharon, recently returned from a meeting in Washington, D.C. with the American Banker’s Association Compliance Executive Committee (CEC). The CEC is comprised of twelve compliance professionals from banks across the U.S., with community, regional, and national organizations all represented. ABA staff from the Government Relations and Professional Development Groups support the committee.
The issue of subprime and predatory lending has received a great deal of attention from Congress. The House appears to be more interested in subprime legislation than the Senate. Both houses of Congress have shown interest in predatory lending, with hearings being held from which legislation could emerge. It is important to remember that even when there is substantial agreement on a piece of legislation it can take up to two years or more to implement it. In the meanwhile, the banking agencies have proposed guidance on subprime mortgage lending on which the ABA is filing comment. Congressional pressure has also prompted the Federal Reserve to conduct a public hearing on its HOEPA powers on June 14th. ABA has offered to provide industry testimony at the hearing. In a related matter, several large banks have recently reported numerous requests from regulators for HMDA and Fair Lending data.
The seasoned customer exemption from CTR reporting has passed the House, however it is unlikely that anything will be introduced in the Senate until after a Government Accountability Office study is completed in 2008.
ABA staffers believe that the final ID Theft regulations will include a board of directors approval requirement, even though it is not a part of the legislation that was passed by Congress. Though the comment period has closed, ABA continues to vigorously oppose the inclusion of this requirement. On the legislative front, ABA continues to stay engaged with the various versions of data breach bills, advocating that Gramm-Leach-Bliley be the standard for banks, that all other entities be required to bring their standards up to that level, and that state laws be pre-empted for banks in compliance with federal regulatory standards.
The banking agencies have proposed a Simplified Privacy Notice that will be considered a safe harbor for GLBA privacy rule compliance. The notice is the result of consumer testing by the agencies and is very prescriptive in terms of format and content. ABA will file comments by the May 29th deadline.
Real estate appraisal guidance could come any time in 2007, as the regulatory agencies continue to work together to issue common guidance.
This fall the ABA will conduct a four-week pandemic exercise. Doug Johnson of ABA is seeking volunteers for the exercise as well as committee members for a Pandemic Issues Group.
It was reported that some banks have begun using the new Suspicious Activity Report (SAR), which has caused problems for the Treasury and the filing bank. As a reminder, use of the new SAR is not currently authorized and the effective date has recently been postponed indefinitely.
While in Washington, I also met with executives from the United States Mint at Mint headquarters to discuss the recently released George Washington dollar coin and the Presidential Dollar Coin series. This program has gotten off to a great start thanks in part to the participation of banks. However, in order for the coin to be better accepted in circulation, retailers must return the coin in change to the consumer. New product offerings for circulation as well as for collectors were discussed, and I can assure you that the Mint has some exciting coins in the works that will be of great interest to novice and experienced collectors alike. Updates are available on their website, www.usmint.com.
The ABA’s Center for Regulatory Compliance has many resources available to the compliance professional, many of which are available on its website: www.aba.com/compliance. Members may also register to receive regular compliance updates via e-mail. I can be reached at 641.628.2121 or michael.olson4@usbank.com.
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