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Washington Archive

Washington

CU execs New HMDA regs must be justified by govt

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ATLANTA, Ga. (7/19/10)—Credit union executives at a recent Federal Reserve hearing on the Home Mortgage Disclosure Act (HMDA) said that while they were not opposed to new HMDA reporting requirements, those requirements, if issued, must be justified. American Airlines FCU's Vice President and General Counsel Faith Anderson and State Employees CU Senior Vice President Phil Greer, both of whom were recommended by CUNA, testified at the Atlanta hearing. Anderson in a prepared statement added that her credit union supported changes to the HMDA requirements “provided that they further the goal of ensuring fair lending and anti-discriminatory practices.” However, Anderson said she was concerned that some proposed changes “would only serve to impose significant, additional compliance and reporting burdens.” Greer in his testimony added that HMDA reporting may at times indicate discriminatory practices that do not exist, and additional reporting may actually help to refute such concerns. The Credit Union National Association’s senior assistant general counsel Jeffrey Bloch said that most members of the panel, which included credit union and bank representatives as well as academics, regulators, and consumer groups, agreed that certain HMDA reporting requirements are generally not useful, such as information on loan preapprovals. Additional HMDA hearings will take place on Aug. 5 in San Francisco, Sept. 16 in Chicago, and Sept. 24 in Washington, D.C., and the input gathered in these hearings will be considered as new HMDA rules are developed. The new reporting requirements will be issued by the Consumer Financial Protection Bureau, which will be established under financial regulatory reform legislation that passed the Senate last week.

NCUA cautions CUs on home equity schemes

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ALEXANDRIA, Va. (7/19/10)--The National Credit Union Administration (NCUA) in a regulatory alert warned credit unions of potential red flags for home equity fraud schemes. The NCUA release, which mirrors a recent advisory from the Financial Crimes Enforcement Network (FinCEN), advises credit unions to specifically include the well-defined Home Equity Conversion Mortgage (HECM) program in the narrative portions of any relevant Suspicious Activity Reports (SARs) that are forwarded to authorities. According to the NCUA, potential criminals may use credit unions to receive, deposit or move funds as part of a HECM fraud scheme. Credit unions may be made aware of these scams through discussions with members who have become victims. If members become victims of these scams, credit unions should “include all information available for each party suspected of engaging in this fraudulent activity.” “This information should include the individual or company name, address, phone number, and any other identifying information,” the NCUA added. This type of extensive background information should also be provided by victims of the fraud schemes. Homeowners may be listed as suspects in the fraud if there is evidence that they participated in the fraud. For the full NCUA release, use the resource link.