September 22, 2021
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State treasurers join opposition to IRS reporting plan

ICBA’s campaign opposing proposed IRS reporting requirements continued making headlines while a coalition of state treasurers joined in.
 
New reports from American Banker and Reuters detail ICBA’s opposition to the proposal, which would require banks to report customer account information to the IRS.
 
Meanwhile, state treasurers from 22 states issued a joint letter to the Biden administration calling the proposal “one of the largest infringements of data privacy” in U.S. history. Arkansas State Treasurer, Dennis Milligan, is the 2021 chairman of this organization. ACB thanks him for the support.
 
ICBA is calling on community bankers to use its customizable email text and social media content to urge consumers to contact Congress in opposition to the plan.
 
In addition, community bankers can call their members of Congress using a new ICBA call alert and customizable script on the proposal.

Source: ICBA
OCC issues proposal on rescinding CRA

The OCC formally published its proposal to rescind its June 2020 Community Reinvestment Act rule and replace it with interagency rules adopted in 1995.
 
The OCC in July said it would rescind the CRA rule and work with other agencies on a joint rulemaking, which the FDIC and Federal Reserve Board affirmed in a separate statement.
 
The OCC is also considering maintaining guidance on qualifying CRA activities for the period between the rescission of the rule and issuance of interagency rules, which is expected next year.
 
Comments on the proposal are due Oct. 29. The proposal is slated to take effect Jan. 1, 2022.
Source: OCC
Nacha issues ACH rules changes

Nacha issued rules on the roles and responsibilities of third-party senders in the ACH Network.
 

  • Define “Nested Third-Party Sender” relationships, in which a third-party sender has an agreement with another third-party sender to act on behalf of an originator and does not have an agreement with the originating depository financial institution, or ODFI.
  • Establish a “chain of agreements” and responsibilities in these arrangements.
  • Clarify requirements that third-party senders conduct risk assessments of their ACH activities.
  • Take effect Sept. 30, 2022, with grace periods for certain portions through March 31, 2023.
 
Nacha also issued a package of minor topics, including clarifications related to the new Meaningful Modernization rules, effective immediately.
Source: Nacha
CSBS Supports Revised Student Lending Policy

The Conference of State Bank Supervisors (CSBS) expressed support this week for the U.S. Department of Education's new legal interpretation regarding state regulation of federal student loan servicers and debt collectors.
 
In a letter to the Education Department, CSBS and the North American Collection Agency Regulatory Association (NACARA) stated their strong support of the legal interpretation made in August, which recognizes state authority and supports state and federal cooperation. The legal interpretation replaces a policy made in 2018 by the Trump Administration that attempted to prevent state financial regulators from supervising federal student loan servicers and providing consumer protections under state law.

The legal interpretation makes clear that neither state laws requiring licensure nor state laws imposing affirmative obligations would be preempted by federal law, the letter said.
 
In addition to voicing their support, CSBS and NACARA encouraged the Department to restore provisions in its servicing contracts to require federal student loan servicers and debt collectors to comply with state law and regulation. These provisions, removed under the Trump Administration policy, foster cooperative federalism, which improves student loan servicing for the benefit of student borrowers and their families.
Source: CSBS
FinCEN issues online child sexual exploitation notice

The Financial Crimes Enforcement Network issued a notice on increasing online child sexual exploitation. The notice provides financial institutions with specific suspicious activity report filing instructions and highlights trends, including a 147% increase in related SAR filings between 2017 and 2020.

Source: FinCEN
Rural economy grows at slower pace in September

Creighton University’s Rural Mainstreet Index slipped in September but remained above growth-neutral for the 10th consecutive month. The index declined to 62.5 from 65.3 in August, with solid grain prices, record-low interest rates, and growing exports underpinning the rural economy while respondents expressed concern with proposals to repeal stepped-up basis.
Source: Creighton University
Consumer sentiment remains bleak

The steep August falloff in consumer sentiment ended in early September, though consumers retained a bleak economic outlook, according to the University of Michigan. The index of consumer sentiment rose slightly from 70.3 in August to 71.0 this month, the least favorable economic outlook in more than a decade.
Source: University of Michigan