Business Continuity Planning – Pandemic

A pandemic is a global disease outbreak that spreads easily person-to-person, causing serious illness, and can sweep across the country and around the world in very short time. There is frequently no vaccine for these pandemics, and people have little or no immunity for the illness. Many health experts say the question is not if, but when, the next pandemic will occur.

A pandemic may come and go in waves, each of which can last for six to eight weeks. An especially severe pandemic could lead to high levels of illness, death, social disruption, and economic loss.
The recent Ebola concerns bring back similar concerns from the H5N1 flu a couple of years ago. While it is very unlikely that the Ebola virus will affect any credit union, it does provide a visible opportunity to review the policies and procedures that need to be in place, just in case.

The Pandemic topic in the Business Continuity Channel can help prepare the credit union should an epidemic occur. Click here for the topic

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


U.S. Ebola cases reminder for CUs of pandemic prep: Agility
MADISON, Wis. (10/20/14)--Given how seriously the United States is taking the presence of Ebola in this country, it seems unlikely that a widespread outbreak of the deadly disease could manifest itself at a large scale.

That said, the sensational nature of the disease does serve as a reminder about the importance of preparing for the threat of pandemics of all kinds, such as the flu or other more common viruses.

"Nobody wants to think about pandemic planning," Paul Sullivan, vice president/general manager of Agility Recovery, a disaster recovery solutions company, told News Now. "The reason they don't want to think about it is because it has no boundaries--it's all about people. And in my mind, credit unions are all about people."

Agility, a CUNA Strategic Services alliance provider, released a white paper and checklist Friday that credit unions can look to when preparing themselves for potential pandemic events.

Called "Gone Viral: Protecting Your Employees and Your Bottom Line from the Effects of Pandemics," the paper outlines the various viruses the world is currently dealing with; who's most vulnerable; what impacts those viruses can have on an organization; and what steps credit unions can take to cut down on potential risks.

To access both the white paper and Agility Recovery's Seasonal Influenza Preparedness Checklist, use the resource links below.

Among the viruses most likely to be encountered in the United States is Enterovirus D68, an airborne virus that often spreads when an infected person coughs, sneezes or touches commonly used surfaces, according to Agility. Mild symptoms include fever, a runny nose, sneezing, coughing and muscle aches.

Then, of course, there's influenza, the most serious cases of which occur in people 65 years and older.

To ensure an organization is minimizing the risk of an outbreak that could severely affect its operation, Agility recommends that organizations take a number of proactive steps, including:

  • Forming health and wellness teams to take the lead on illness prevention for the organization;
  • Meeting once a year to stress the importance of prevention and to keep employees informed;
  • Encouraging employees to get flu vaccines, or if possible offer free vaccines to employees;
  • Placing hand sanitizer dispensers throughout the office;
  • Promoting telecommuting when employees are feeling sick; and
  • Routinely sanitizing common surfaces such as kitchen countertops, conference room tables and door handles.

Even when a comprehensive plan is followed, however, the truth is that flu season is unavoidable, Agility says, and there's still always a chance an organization could be impacted.

Should a health crisis occur, Agility recommends:

  • Developing a work redundancy plan to make sure every employee is trained to cover at least one other person in their group;
  • Setting up a communication system that includes voice messages, text messages and emails to be able to quickly alert employees and members about such an outbreak;
  • Setting threat-level guidelines that determine when it's appropriate to cancel meetings or travel; and
  • Monitoring unusual increases in absenteeism, among other actions.

"With proper planning, education and services such as the flu vaccine, an organization can minimize sick days and reduce health costs, while ensuring that productivity and quality care are maintained," Agility says.

Source: CUNA News Now

OFAC consolidates all non-SDN sanctions lists
WASHINGTON (10/20/14)--With the goal of making is easier to comply with its regulations, the U.S. Treasury's Office of Foreign Assets Control (OFAC) is offering all of its non-Specialty Designated Nationals (SDN) lists in one consolidated data list. Known as the Consolidated Sanctions List, the files comply with all of OFAC's existing data standards.

According to OFAC, the effort is designed to reduce the number of list-related files that must be downloaded in order to maintain an automated sanctions screening program. If OFAC creates a new sanctions list where the action required of a U.S. person does not necessarily entail blocking, the office will add the new data associated with that list to the files if appropriate.

The lists include:

  • Non-SDN Palestinian Legislative Council List (NS-PLC);
  • Part 561 List;
  • Non-SDN Iran Sanctions Action List (NS-ISA);
  • Foreign Sanctions Evaders List (FSE); and
  • Sectoral Sanctions Identifications List (SSI).

In approximately six months, OFAC will cease issuing independent data files for the FSE, the SSI and the NS-PLC lists. OFAC will continue to provide and update PDF and TXT versions of the FSE, SSI, NS-ISA, NS-PLC and Part 561 lists and their respective archive of changes. These file formats will continue to be available after the transition period.

OFAC has also upgraded its Sanctions List Search tool, which provides users the ability to search for a name on the SDN lists and the consolidated list. All lists are available in Sanctions List Search.

Source: CUNA News Now

CFPB develops tools for student loan relief
WASHINGTON (10/1714)--Struggling student loan borrowers are increasingly reporting that they receive little information or help when they get in trouble, according to a new report from the Consumer Financial Protection Bureau's (CFPB) student loan ombudsman.

The report is primarily based on 5,300 student loan complaints filed with the bureau from financial institutions with $10 billion or more in assets.

"We are hearing from consumers that they are driven into default because private student loan companies are not providing concrete loan modification options," said CFPB Director Richard Cordray. "Struggling private student loan borrowers are finding themselves out of luck and out of options. Lenders and servicers must redouble their efforts to deal with these distressed borrowers."

Common complaints from distressed borrowers include:

  • Many private student lenders and servicers are not transparent in communications, nor are they consistent with information ways to avoid default;
  • Options for assistance are often only for a short period of time;
  • Some options are only provided from lenders and servicers only after the loan is in default;
  • Experiences of unusual processing delays, unclear requirements and unaffordable fees; and
  • Many lenders' in-school deferment policies force borrowers to choose between finishing school and repaying a loan.

Among the recommendations in the ombudsman's report are potential changes to the U.S. Bankruptcy Code. One potential option is to determine whether the special bankruptcy protection afforded to lenders may be limited to those lenders that offer certain loan modification options.

"Providing incentives for market participants to encourage student loan borrowers to successfully repay and avoid default can also help to ensure that these borrowers will be able to fully participate in the economy even if they encountered economic challenges early in their working lives," reads the report.

The bureau also recommended that it be determined whether lenders and service providers are providing adequate and timely disclosures about repayment options, particularly in times of financial hardship.

Use the resource links below to access the full report, as well as a blog post from the ombudsman.

Source: CUNA News Now

FIs can post privacy notices online under new CFPB rule
WASHINGTON (10/21/14)--A rule allowing financial institutions that meet certain requirements to post annual privacy notices online has been finalized by the Consumer Financial Protection Bureau (CFPB).

The Gramm-Leach-Bliley Act (GLBA) requires financial institutions to send annual privacy notices to customers, describing whether and how it shares consumers' nonpublic personal information. If the institution does share this information, it must notify consumers of their right to opt out and inform them how to do so.

Under the CFPB's new rule, requirements that allow financial institutions to post privacy notice online include:

  • The financial institution does not share data in ways that would trigger consumers' opt-out rights;
  • Consumers are informed annually about the availability of the disclosures; and
  • A notice is included on a regular consumer communication, such as a monthly billing statement for a credit card, letting consumers know that the annual privacy notice is available online and in paper by request at a provided telephone number.

If an institution chooses not to use the new disclosure method, it will need to continue to deliver annual privacy notices to its customers using other delivery methods.

The new rule applies to all financial institutions within the CFPB's jurisdiction under the GLBA. Institutions that choose to rely on this new method of delivering privacy notices will be required to use the model disclosure form developed by federal regulatory agencies in 2009.

The rule is effective upon publication in the Federal Register.

Source: CUNA News Now

Federal Regulators approve final QRM rule
WASHINGTON (10/21/14 Updated 12:05 p.m.)--Federal regulators have approved a final qualified residential mortgage (QRM) rule, which requires investment banks to hold at least 5% of a loan's risk on their books when securitizing loans unless the loans meet the definition of a QRM. The rule also more closely aligns the definition of QRM with the Consumer Financial Protection Bureau's (CFPB) qualified mortgage (QM) definition, an alignment for which the Credit Union National Association strongly advocated.

"CUNA has advocated strongly for the important step of aligning the Qualified Residential Mortgage with the existing Qualified Mortgage definition," said Mary Dunn, CUNA's deputy general counsel and senior vice president. "Doing so encourages lenders to work with creditworthy borrowers to make home loans that will continue to drive the country and our economy forward."

Thomas Curry, Comptroller of the Currency, said the rule is an important milestone.

"The rule we are approving today will require lenders to retain some of the risk for the loans that go into securitized pools except for home mortgages that meet the standards necessary under the qualified residential mortgage, or QRM, exception," he said. "Under this rule, QRM is equivalent to QM, that is, the qualified mortgage rule approved by the Consumer Financial Protection Bureau."

Federal Housing Finance Agency (FHFA) Director Mel Watt called it "a major step forward" to providing certainty to the housing market.

"Aligning the qualified residential mortgage standard with the existing qualified mortgage definition also means more clarity for lenders and encourages safe and sound lending to creditworthy borrowers," he said.

CUNA supported aligning the definition of a QRM more closely with the definition of a QM in commenting on the proposal last year. However, CUNA does not support the 43% debt-to-income ratio a borrower must meet for a QM.

The rule also states that regulators will review the QRM standards in four years.

"By then, we should have enough experience with the standards to know whether they strike the right balance between long-term financial stability and the home-financing needs of American families, and we can adjust them if necessary," Curry said.

The joint rule was proposed by the Federal Reserve Board, Federal Deposit Insurance Corp., U.S. Department of Housing and Urban Development, FHFA, Office of the Comptroller of the Currency and the Securities and Exchange Commission.

Source: CUNA News Now


CUNA Continues to Seek Comments on HMDA Proposed Rule

CUNA is continuing to speak with credit unions and leagues on the CFPB’s proposed rule regarding the Home Mortgage Disclosure Act (HMDA), and welcomes additional comments. The deadline for submitting comments to the CFPB is October 29. Last week, CUNA staff participated on separate conference calls with both credit unions and the Small Business Administration’s Office of Advocacy to discuss concerns with the CFPB’s proposal. Among other things, the concerns from credit unions and others include the overreach of the CFPB in requiring additional data points that are beyond the Congressional mandate of the Dodd-Frank Act, the inclusion of home equity lines of credit (HELOCs) for HMDA reporting purposes, and the extremely low proposed reporting threshold of 25 covered loans, excluding HELOCs, in the preceding calendar year. Leagues and credit unions should continue to send their comment letters as well as comments on the proposed rule to Jared Ihrig, CUNA’s Associate General Counsel for Regulatory Advocacy. Click here for CUNA’s Regulatory Call to Action.

CFPB Issues Proposed Policy on No-Action Letters

Last week, the CFPB issued a proposed policy on no-action letters, and is accepting comments until December 15. In specifying the purposes, objectives, and functions of the CFPB in section 1021 of the Dodd-Frank Act, Congress authorized the CFPB to “exercise its authorities for the purpose of ensuring that markets for consumer financial products and services operate transparently and efficiently to facilitate access and innovation.” In line with the CFPB’s authority, it is proposing a policy under which CFPB staff would issue no-action letters (NALs) to specific applicants in instances involving “innovative financial products or services that promise substantial consumer benefit where there is substantial uncertainty” whether, or how, specific provisions of statutes or CFPB regulations would be applied.

As proposed, a NAL would advise the recipient that, the staff does not presently intend to recommend an enforcement or supervisory action against the requester with respect to a specified matter. Further, NALs would be:

  • Subject to modification or revocation at any time in the sole discretion of the staff, and may be conditioned on particular undertakings by the applicant with respect to product or service usage and data-sharing with the CFPB;
  • Publicly disclosed; and
  • Non-binding on the CFPB, courts, or other regulators or parties in litigation.

See CUNA’s Regulatory Call to Action on the proposed policy.


Regulatory Advocacy Report

The CUNA Regulatory Advocacy Report 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. You can view the current report and past reports from the archive.

Compliance eNEWSLETTER

October 24, 2014
Vol. 8, Issue 41

Created in partnership with the

Credit Union National Association

Disaster Recovery
The National Credit Union Administration (NCUA) expects all federally insured credit unions to have a comprehensive contingency plan that is regularly tested. This presentation provides the information your credit union’s needs for a Disaster Preparedness and Recovery Plan.

Click here for the video

October, 2014 November, 2014
  • November 2nd, 2014: Daylight Savings Time Ends
  • November 11th, 2014: Veterans' Day - Federal Holiday
  • November 17th, 2014: Remittance Transfer - Regulation E Change
  • November 27th, 2014: Thanksgiving Day - Federal Holiday
December, 2014 January, 2015


October 19 – 22
CUNA Attorney's Conference, Dana Point, CA

October 26 - 29
CUNA Bank Secrecy Act Conference
, Las Vegas, NV

CUNA Webinars
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!

Harassment, Discrimination and Workplace Violence webinar 10-22-2014

Online Banking for Business Accounts webinar 10-22-2014

DNEs and Reclamations - A Financial Institutions Liability webinar 10-23-2014

CUNA Bank Secrecy Act Conference (2014) 10-26-2014

HR Audits - The Whats and the Whys webinar 10-29-2014

CUNA Bank Secrecy Act eSchool (2014) 11-05-2014

CUNA Information and Technology Compliance eSchool 11-07-2014

Vendor Management - The Big Picture webinar 11-07-2014

Social Engineering the Credit Union webinar 11-14-2014

IT Examination Hot Spots and Examination Focus webinar 11-21-2014

Electronic Discovery in Litigation webinar 12-05-2014

IT Compliance and Enterprise Risk Management webinar 12-12-2014