One of the benefits of your credit union's League membership is access to InfoSight--a valuable online compliance resource. This newsletter contains some timely highlights, and access to InfoSight is a benefit of League affiliation, so it is password-protected. If you have a specific compliance issue or concern, contact our Consulting Department at (800) 285-5300. Replies to this email will be directed to SVP, League Services & Regulatory Analysis Joe Guilfoy .
InfoSight Highlight
InfoSight – Employment
On the Employment channel in InfoSight are 30 different topics, some of which may apply to YOUR credit union!  Are you hiring new employees and need to know the questions you can and can’t ask or learn more about the Equal Employment Opportunity requirements? What if one of your employees has questions about the Family and Medical Leave Act? And - do you know what should – or shouldn’t – be kept in a personnel file? 

Be sure you are kept up-to-date with the information in the Employment channel today!
Compliance Videos
Compliance Outlook for Q1 and Q2 2018
In this video, Glory LeDu provides the overview of what’s ahead in the compliance world for 2018 . This covers annual threshold updates, HMDA changes, Payday Alternative Loans, Military Lending Act, ACH Same-day ACH processing and more!
 
Just a reminder that Compliance videos since 2016 can be found on YouTube at the Compliance Connection channel , where they are generally updated quarterly.
Compliance News
IRS reminds taxpayers to report virtual currency transactions
The Internal Revenue Service recently reminded taxpayers that income from virtual currency transactions is reportable on their income tax returns.  Read the complete article here.
 
Source: IRS.gov
Fed adjusts interest rates in Regulations A and D
The Federal Reserve Board published in the recent  Federal Register amendments to Regulations A and D. The  Regulation A amendment  changes the interest rates in § 201.51(a) for primary credit and in § 201.51(b) for secondary credit provided to depository institutions by the Federal Reserve Banks to 2.25 percent and 2.75 percent, respectively, and applicable to credit extended beginning March 22. The  Regulation D amendment  increases the interest rates in § 204.10(b)(5) paid by the Federal Reserve Banks on required and excess reserves to 1.75 percent and applicable to reserve balances beginning March 22.

Source: Federal Register
New CDD Rule: Exceptions and Exemptions
Beginning May 11, 2018, credit unions will be required to obtain identifying information about the beneficial owners of their legal entity accounts. 
 
We also know that beneficial owners are defined in the rule as:

  • Ownership Criteria: Each individual, if any, who, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, owns 25 percent or more of the equity interests of a legal entity customer: and
  • Control Criteria: A single individual with significant responsibility to control, manage, or direct a legal entity customer, including:

  1. An executive officer or senior manager (e.g. a Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, Managing Member, General Partner, President, Vice President, or Treasurer); or
  2. Any other individual who regularly performs similar functions.

There are some legal entities and some accounts that are so unlikely to foster money laundering that FinCEN has provided exceptions to the rule. In the final weeks before the compliance date, let's review the exceptions and exemptions of the new requirements.
Quasi-Exception:   The following are instances when a credit union will only obtain the information required by the control criteria as described above:

  • When there is no individual or entity that owns at least 25% of the legal entity opening the account at the credit union;
  • When the legal entity is established as a nonprofit corporation or similar entity and has filed its organizational documents with the appropriate State authority as necessary; and
  • When the legal entity is a pooled investment vehicle that is operated or advised by a financial institution not already excluded by one the several exceptions in the rule as described below.
 
Click here to read the rest of CUNA’s blog post!
 
Source: CUNA Compliance Community
Advocacy Highlight
CUNA Hosts Webinar on USAA Remote Capture Patent Issues
CUNA and outside Counsel conducted a webinar to discuss the letters credit unions are receiving from a law firm inviting them to negotiate a patent licensing deal with USAA for the continued usage of remote deposit capture (RDC) technology. According to the letter, USAA was the first to develop and patent RDC technology, and the patent licensing campaign is an effort to recover “a small and fair portion” of the value USAA has provided to the financial services industry.

Did you miss the webinar? To obtain a recorded version, click here.
CUNA and LSCU File Amicus Brief in Support of The Infirmary FCU
CUNA and the League of Southeastern Credit Unions and Affiliates (LSCU)   filed a brief in support of a credit union   facing a predatory lawsuit alleging noncompliance with the Americans with Disabilities Act (ADA). The brief was filed in Scott v. The Infirmary FCU in the U.S. District Court for the Southern District of Alabama.

“This brief was filed by CUNA and LSCU to continue our aggressive defense of credit unions hit with predatory lawsuits from plaintiffs’ attorneys looking to exploit a law that protects disabled Americans,” said CUNA President/CEO Jim Nussle. “Credit unions unfortunately continue to see a string of meritless lawsuits taking advantage of ambiguities about what is required for website accessibility. In our brief, CUNA once again highlights that credit unions need clarity beyond a private industry standard and deserve due process.”
The primary arguments of the joint brief are :
  • The plaintiff lacks standing to file suit against the credit union;
  • A website is not a place of public accommodation;
  • Applying Title III of the ADA to websites renders the statute impermissibly vague in the absence of any implementing regulations by the Department of Justice; and
  • The court should dismiss the complaint pursuant to the Primary Jurisdiction Doctrine. [Read more here]
 
Source: CUNA Advocacy
Keeping up with CUNA Advocacy
To stay abreast of the issues on which CUNA has provided input to lawmakers and regulators, here is a list of those topics .
Weekly Regulatory Advocacy Report
The Weekly Advocacy Report provides links to information about a number of recent League, CUNA and NCUA regulatory and advocacy activities. 
   
Upcoming Education Sessions
The League has several education sessions coming up. Several focus on compliance issues. They are listed in calendar format on the League website.
   
League Consulting Department Staff
(800) 285-5300
Compliance Calendar
April
  • April 19, 2018: Amendments to the 2013 Mortgage Servicing Rules
  • April 29, 2018: 5300 Call Report Due to NCUA
May
  • May 11, 2018: Customer Due Diligence – CDD (FinCEN) – Effective date
  • May 28, 2018: Memorial Day - Federal Holiday
July
  • July 1, 2018: Regulation CC Amendments – Availability of Funds and Collection of Checks
  • July 4, 2018: Independence Day - Federal Holiday
  • July 29, 2018: 5300 Call Report Due to NCUA
September
  • September 3, 2018: Labor Day - Federal Holiday
October
  • October 8, 2018: Columbus Day - Federal Holiday
November
  • November 12, 2018: Veterans Day (observed) - Federal Holiday
There's more available from InfoSight
InfoSight content is available from the League's website . Visit anytime to get sample policies, links to federal regulations and summaries of issues that are hot-topics at your credit union. 
 
Access to InfoSight is a benefit of League affiliation, so it is password-protected. If you don't have a password or if you have forgotten yours, click on the tan "Log In" button in upper right corner of the site; a box will open. Click on the blue wording to get your password.