Representative Payees

A “representative payee” is a person who has contracted with the Social Security Administration (SSA) to act as a recipient for funds of a person who is incompetent because of age (i.e. under 18) or due to a mental or physical condition and is incapable of handling his or her own affairs. When benefit payments are required to be paid into a separate dedicated account, the representative payee is required to establish an account in a financial institution. This dedicated account may be in any of the following types of accounts:

  • Share draft/checking
  • Share/savings
  • Money market

Dedicated accounts may not be in the form of share certificates/certificate of deposits. 

A representative payee must use the payments received only for the use and benefit of the beneficiary in a manner and for the purposes he or she determines to be in the best interests of the beneficiary. The credit union is not responsible for monitoring the activity of the account or ensuring that withdrawals are used for any required purpose.

For additional information, click here for the topic.

Review the information today to help your credit union remain in compliance.


CFPB information on unauthorized Wells Fargo

The CFPB has posted an article with information for consumers who incurred fees as a result of an unauthorized Wells Fargo account. The CFPB suggests that customers of any bank or credit union should always closely monitor their accounts to make sure they don’t see unauthorized products or account activity. If they suspect that they had an unauthorized account opened, they should visit their local bank branch or call their financial institution. If they continue to have an issue, they can submit a complaint to the CFPB, either online or by calling toll-free (855) 411-2372. Wells Fargo customers should not have to contact the bank to receive a refund of fees they incurred as a result of the bank's recently revealed illegal conduct. Wells Fargo has already been ordered to identify affected consumers and make the required refunds.

Source: CFPB

NCUA board briefed on new cyber risks

At an open meeting, the NCUA Board received a briefing from the regulator’s Office of Examination and Insurance on the rapidly changing nature of cybersecurity. The Board was told the financial services sector is experiencing an "Uber moment," and technological innovation, the expansion of social networking and growing interconnectivity are fueling fundamental change in cybersecurity procedures and processes. That change carries with it more sophisticated risks and more numerous vulnerabilities for community-based financial institutions like credit unions. Potential effects on credit unions include higher mitigation costs and lower consumer confidence, as well as greater financial and legal risks. The agency maintains a cybersecurity resources webpage that offers extensive, detailed information on cybersecurity matters. Credit unions are encouraged to use this resource.

Source:  NCUA

NACHA announces third-party sender registration rule

NACHA has announced that a new rule has been approved that will require Originating Depository Financial Institutions (ODFIs) to identify and register their Third-Party Sender customers. The registration process will promote consistent customer due diligence among all ODFIs, and serve as a tool to support NACHA’s continuing efforts to maintain ACH Network quality. A Third-Party Sender is a processing intermediary between a financial institution and an end-user of ACH payments. The Third-Party Sender Registration Rule, which becomes effective September 29, 2017, will require ODFIs to provide a limited set of initial, basic registration information, such as name of business and contact information, for each Third-Party Sender with which it maintains a relationship. ODFIs that do not maintain any Third-Party Sender relationships will be required to provide a statement to that effect.

To help support the industry with managing and identifying Third-Party Sender relationships, NACHA has developed a number of tools and resources, including a Third-Party Sender Identification Tool and an Operations Bulletin that provides examples to help ACH participants properly categorize the parties in payment scenarios involving payment intermediaries, many of which are Third-Party Sender relationships.

Source:  NACHA

FinCEN Advisory on E-mail Compromise Fraud Schemes

FinCEN recently issued an advisory to financial institutions on e-mail compromise fraud schemes in which criminals misappropriate funds by deceiving financial institutions and consumers into conducting wire transfers. This advisory provides red flags that institutions can use to identify and prevent these schemes. The red flags were developed in consultation with the FBI and U.S. Secret Service.

The main types of e-mail compromise fraud include:

  • Business E-mail Compromise (BEC): which targets a financial institution's commercial customers; and
  • E-mail Account Compromise (EAC): which targets a victim's personal accounts.

BEC and EAC schemes are among the growing trend of cyber-enabled crime adversely affecting financial institutions, with 22,000 reported cases of BEC and EAC fraud involving $3.1 billion since 2013.

Click here for FIN-2016-A003: Advisory to Financial Institutions on E-Mail Compromise Fraud Schemes

Updated FATF-Identified Jurisdictions with AML/CFT Deficiencies

This past June, the Financial Action Task Force (FATF) updated its list of jurisdictions with strategic Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) deficiencies. These changes may affect U.S. financial institutions' obligations and risk-based approaches with respect to relevant jurisdictions.

The FATF has identified the following jurisdictions as having deficiencies in their AML/CFT regimes: Afghanistan, Bosnia and Herzegovina, Guyana, Iraq, Lao PDR, Syria, Uganda, Vanuatu, and Yemen. These countries have developed an action plan with the FATF to correct these deficiencies. Myanmar (Burma) and Papua New Guinea have been removed from the FATF listing.

Click here for FIN-2016-A004: Advisory on the FATF-Identified Jurisdictions with AML/CFT Deficiencies

Source: FinCEN


Action Alert:  CFPB's Small Dollar Loan Proposal

The Consumer Financial Protection Bureau (CFPB) released an extremely complex 1300+ page small dollar rule in early June. The proposed rule includes some reforms to predatory lending practices, which credit unions would support if narrowly tailored. Unfortunately, the CFPB's proposed rule badly misses the mark of targeting predatory behavior, and instead threatens to limit consumer-friendly alternatives to short-term, small dollar loans.  We encourage you to share your story with the CFPB, and tell them the negative impact this rule will have on your ability to provide services to your members. The comment period closes on October 7.

California Credit Union Act Modernization Signed into Law

A bill modernizing California’s state credit union act, A 2274, passed its final hurdle in when it was signed by the governor yesterday. The bill is the product of an extensive push by the California Credit Union League, which worked closely with lawmakers to ensure the bill’s passage.

The legislation strengthens the state charter by:

  • Allowing member business loans to exceed a member's deposits
  • Eliminating board approval of membership applications
  • Allowing for an audit committee in lieu of a supervisory committee
  • Allowing non-members to act as the co-borrower, surety, or guarantor of a loan made to a member
  • Redefining which credit union officials' loans are subject to certain limitations and are required to be reviewed by the board
  • Allowing credit unions to decide whether their boards need to meet on a monthly basis, or if they should opt to meet less often based on the needs of the credit union
  • Removing unnecessary loan documentation requirements

The provisions are effective January 1, 2017.

FOM Parity Granted in South Carolina

Last week, the South Carolina State Board of Financial Institutions (BOFI) expanded the Field of Membership (FOM) for South Carolina state-chartered credit unions. The BOFI updated state regulations to include “members of the household of a member in the credit union’s field of membership.” This change provides parity with federally chartered credit unions.

Prior to the change, the term "household" was not defined in the state statute, regulations, or operating instructions governing state-chartered credit unions in South Carolina. With support from the Carolinas Credit Union League, credit union representatives on the BOFI worked to ensure the changes provided the necessary flexibility for state-chartered credit unions.

Credit Union Hike-the-Hills Provide Opportunities to Voice Concerns on CFPB Small Dollar Rule

This month, representatives from dozens of credit unions are traveling to Washington, DC to represent the industry on Capitol Hill and federal agencies. With only a few weeks remaining in the comment period for the CFPB’s payday and small dollar loan rule, credit union representatives are using this time to voice concerns about how the CFPB’s overly broad rule could detrimentally impact credit union members, who rely on consumer friendly credit union small dollar loans. Credit unions continue to urge the CFPB to focus the rule on predatory practices in the payday lending market, and to avoid adding new requirements to credit union small dollar loans, which consumers need as a safe and affordable alternatives. They will also continue to urge the CFPB to more narrowly tailor the rule so that totally different types of loans, such as auto refinances, are not impacted. 

Source:  CUNA Advocacy

CUNA Advocacy Update

The CUNA Advocacy Update is published at the beginning of every week and keeps you on top of the most important changes in Washington for credit unions--and what CUNA is doing to monitor, analyze, and influence government agencies and federal law. 

ComplySight Level 2.5 – What is it?  NEW Webinar!

In response to feedback from many users, a new access level – L2.5 – has been added to ComplySight.  To explain a little more about why a user may want to have this access and what purpose it serves, a new webinar, Level 2.5 – Reviewer Access, will be held on October 18, 2016 at 3:30 p.m. ET.  Click here to register now! You won’t want to miss it!

ComplySight: 30 Day Free Trial!

League InfoSight is offering a free, 30-day trial of ComplySight so you can see the benefits first hand. It's easy to get started. Just visit us online.

FREE Webinars on ComplySight, the League's latest compliance resource

Registration is now open for your front row seat to learn about ComplySight, League InfoSight’s newest addition to your compliance toolbox. If you're looking for a solution to the compliance tidal wave, this system is for you!


For “recorded” webinars, click on the title of the webinar to listen.  Users may be asked to download WebEx, which is a safe download for viewing the webinars.  These are also available on the Dashboard in ComplySight and are available 24/7! 

Introduction to ComplySight
Designed to introduce and show the many features and benefits of ComplySight.

ComplySight Training & TipsWhere to Start?
This webinar will: suggest a starting point as a new ComplySight user, discuss how Factor Grading works, review the Action Item Build/Edit process, and discuss the need for a compliance management tool that regulators - and you - will appreciate.

ComplySight Training & Tips Regulatory Alerts, Assigning Employees, Preview of L2.5, Tools in the Help Area
What should be done when you get an email about a Regulatory Alert?  Where are “old” Regulatory Alerts? How do I assign an employee to an Area, and what will be different with the upcoming Level 2.5?  And – what tools are available in the Help area?  This webinar will explore all of this – and more!

ComplySight Training & TipsHow to Export Data
When you need to archive or copy data out of ComplySight for a fresh start or to provide information for a Board meeting, this webinar will explain the process.

ComplySight Training & TipsReports in ComplySight
What information is contained on the reports in ComplySight and how are they used?

Compliance eNEWSLETTER

September 23, 2016
Vol. 10, Issue 38

Created in partnership with the

Credit Union National Association

Military Lending and 3rd Quarter 2016 Review

This video provides an overview of the key changes made to the Military Lending Act that credit unions are going to need to consider and implement prior to the compliance effective date of October 3, 2016.  View the video here.

Be sure to view this new video, where Glory LeDu, Manager of League System Relations provides an overview of the compliance challenges your credit union is facing now in the 3rd quarter of 2016. 

Same Day ACH Preview

In this newly released video Amy Smith, VP and Executive Director of The Clearing House Payments Authority, provides background information on the current batch-and-forward ACH payment system and introduces the “Phased Approach” of the Same Day ACH program, which will begin in September of 2016.  You will want to pay special attention to Amy’s suggestion to review current ACH files you may be transmitting.  View the video here.

October, 2016 November, 2016
  • November 6th, 2016: Daylight Savings Time Ends
  • November 11th, 2016: Veterans' Day - Federal Holiday
  • November 24th, 2016: Thanksgiving Day - Federal Holiday
December, 2016
  • December 1st, 2016: Overtime Rule (Department of Labor) – Effective date
  • December 26th, 2016: Christmas Day (observed) - Federal Holiday
January, 2017

Interagency Fair Lending Hot Topics Webinar

The 2016 Interagency Fair Lending Hot Topics live webinar will be hosted by the Federal Reserve from 2–3 pm ET on October 4, 2016.  During the session, representatives from six federal agencies will discuss a variety of emerging fair lending issues and hot topics, including:

  • CFPB updates
  • Compliance management
  • Redlining
  • HMDA validation
  • Automobile lending

The presentation will be followed by a Q&A, where speakers will respond to audience questions.  Please click on the URL or copy and paste it into your browser to register for this webinar:

NCUA Webinars - Regulatory Compliance Training

Hot Topics in Compliance (click to register)

  • An overview of the Bank Secrecy Act, with discussion of requirements and common violations; 
  • Monitoring of money laundering; 
  • Suspicious Activity Reports; 
  • Equal Credit Opportunity Act adverse action notice requirements; and 
  • Office of Consumer Protection contact information. 

Cybersecurity – Intrusion threats and vulnerabilities


CUNA offers hundreds of online training events that make it easy for you to learn right at your desk. Whether you are looking for a beginner course or want a comprehensive understanding on a specific topic, CUNA webinars, audio conferences and eSchools have what you need. 

Click here for updates on compliance, operations, lending topics and more!