IRA Basics Seminar on May 3 Canceled
The SDBA has canceled its IRA Basics Seminar on May 3 in Sioux Falls due to low registration numbers. Those in need of training are encouraged to attend the SDBA's 2016 IRA School on Sept. 7-9 in Sioux Falls. More information and register.
Encore Presentation of "Ransomware Nightmare Spurs Guidance" To Be Offered
Due to the popularity and demand of the Graduate School of Banking-Wisconsin's online seminar "Ransomware Nightmare Spurs Guidance," a special encore presentation will be offered on Monday, May 2, at 10 a.m. CDT.
If your bank received an email threatening to destroy bank or customer data if you don’t pay $1,000, what would your bank do? Is it a good business decision to pay up? Does someone really have the ability to control a computer at your bank?
Ransomware is so concerning that the FBI has issued warnings and guidance to banks.Join GSB in this webinar to see ransomware, live and in-action, to better understand the risk associated with this growing threat. Learn more and register.
ABA, ABIA to Host Webinar on Ag Credit Issues
Next week, ABA and the American Bankers Insurance Association will host a free webinar on crop insurance and the Farm Credit System. On Thursday, April 28, at 10 a.m. CDT, Tom Zacharias of National Crop Insurance Services and ABA VP Ed Elfmann will discuss challenges facing the crop insurance industry and ABA’s efforts to increase transparency and oversight at the FCS. Register now.
NIST Cybersecurity Seminar in Sioux Falls is Big Opportunity for Businesses
The state of cyberattacks and security practices will be the topic of discussion at a major training seminar for businesses May 3-4 at the Holiday Inn City Centre in Sioux Falls.
The seminar is an opportunity for businesses in the Upper Midwest and beyond to learn about a new federal framework for improving the security of the nation’s critical infrastructure. The guidelines were developed under the leadership of the National Institute of Standards and Technology, more commonly known as NIST. NIST is a non-regulatory agency within the U.S. Department of Commerce.
In response to President Obama’s executive order issued in 2013, NIST led the development of up-to-date standards, guidelines and practices designed to help businesses improve their cybersecurity risk management.
The training will equip attendees with the tools and knowledge to apply the framework within their companies. The event is sponsored by SDN Communications, South Dakota Telecommunications Association and Dakota State University. Learn more and register.
Question of the Week
If a mortgage loan is charged off, am I still required to provide the borrower with a Regulation Z escrow closing notice if I close his or her escrow account? The account is just a typical escrow for taxes and insurance and was not set up as the result of the customer’s delinquency.
Answer: Yes—a charged-off debt is not extinguished and is still the borrower’s obligation, so in the event you terminate the borrower’s escrow account, you still must send them the escrow closing notice as required by 12 CFR §1026.20(e) of Regulation Z, unless their obligation to pay the loan back was completely extinguished beforehand.
Not a Compliance Alliance member? Learn more about membership with Compliance Alliance by attending one of our live demos:
Compliance rules and regulations change quickly. For timely compliance updates, subscribe to Compliance Alliance’s email newsletters.
Compliance Alliance offers a comprehensive suite of compliance management solutions. To learn how to put them to work for your bank, call 888.353.3933 or email.
Upcoming Events
- Tri-State Trust Conference: April 25-27, 2016, Fargo, N.D.
- FHA and USDA Mortgage Skills: May 18-19, 2016, Pierre
- 2016 NDBA/SDBA Annual Convention: June 12-14, 2016, Bismarck, N.D.
- 2016 Dakota School of Banking: June 19-24, 2016, Jamestown, N.D.
- National School for Experienced Ag Lenders: June 20-23, 2016, Spearfish, S.D.
View all SDBA events
Sponsorship Opportunity
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Questions/Comments
Contact Alisa DeMers, SDBA, at 800. 726.7322 or via email.
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SDBA, Banks Run Ad on Tax Day
As part of the SDBA's ongoing efforts to educate the general public about the differences between tax-paying banks and tax-exempt credit unions, the SDBA ran an ad originally designed by the ABA as a quarter-page, full-color ad in South Dakota's 11 daily newspapers last Friday. (The ad appeared in the Capital Journal on Monday.)
Some SDBA member banks also made the decision to run the ad in their local weekly newspapers. Now, it is more crucial than ever that we power up, expand bankers' participation in the political process and work to rebuild the banking industry's political clout. Running this ad on or around Tax Day was just one small step in that direction.
The message is pretty simple. According to the IRS, an American family of four will pay $14,057 in federal income taxes. This nation's one-trillion-dollar credit union industry will pay $0. View the ad.
The SDBA also shared this message on its website, via Facebook and on Twitter. The SDBA asks bankers to go out and help spread this message through social media.
Nichols Calls on Congress to End CU Tax Exemption
As millions of Americans filed federal income taxes, ABA President and CEO Rob Nichols wrote to Congress urging lawmakers to end the credit union tax exemption. With the 10-year cost estimated by the Congressional Budget Office at $27 billion, the exemption is one of the single largest corporate tax loopholes in the U.S.
Nichols argued that the line between banks and credit unions has blurred over time, and that the Great Depression-era tax exemption is no longer justifiable for the $1.1 trillion credit union industry, since many credit unions now operate virtually the same way as banks. Furthermore, he wrote, the benefits of the tax exemption are rarely if ever passed along to consumers; recent research has shown that in most cases, credit unions leverage the tax subsidy to raise employee salaries or expand the size of their institution.
And while credit unions have made the argument that they deserve tax-exempt status because they are customer-owned, Nichols pointed out that other banks with cooperative, customer-owned structures such as mutual savings banks and thrifts have been subject to federal income taxes for decades.
“The status quo is unacceptable,” Nichols wrote. “On this day, when individuals and businesses will settle up with the government for nearly $2 trillion in federal income taxes, it is simply not fair that the entire credit union industry pays nothing. The public policy justification disappeared long ago, and taxpayers should no longer subsidize these large aggressive credit unions.” Read Nichols' letter.
Democratic Senators Call for New GAO Study of Fintech
Senate Banking Committee Ranking Member Sherrod Brown (D-Ohio), joined by Sens. Jeff Merkley (D-Ore.) and Jeanne Shaheen (D-N.H.) on Monday called on the Government Accountability Office to conduct a new study of the fast-growing nonbank financial technology sector. GAO’s previous fintech study was issued in 2011, when fintech was focused on peer-to-peer lending, and fintech has grown substantially in loan volume, in investment volume and in the number of financial product markets it competes in.
“It is possible that the current online marketplace for small business loans falls between the cracks for federal regulators,” the senators wrote. “We are very interested in ensuring that fintech provides credit to small businesses and consumers in a way that prevents abusive practices while expanding economic opportunity.”
The senators specifically asked the GAO to study the current scope and scale of fintech lending, potential risks to individual investors, changes in the regulatory framework, differences in regulation of banks and fintech firms, underwriting practices, disclosure requirements, data security standards and anti-money laundering rules. Read more.
House Passes ABA-Backed Relief for Small Bank Holding Companies
The House voted by a bipartisan 247-171 margin to pass an ABA-advocated bill expanding the regulatory relief offered under the Federal Reserve’s small bank holding company policy statement. Sponsored by Rep. Mia Love (R-Utah), H.R. 3791 raises the asset threshold for relief under the statement from $1 billion to $5 billion, exempting more than 400 additional community banks from certain capital and regulatory requirements. The threshold was previously raised from $500 million to $1 billion in 2015.
“This legislation facilitates the ability of community banks to issue debt and raise capital; thus increasing their involvement in promoting the growth of their local economies,” ABA said in a memo sent to House members last week. “This is important as regulators have proposed through other regulations to increase capital requirements for both community banks and larger institutions in the coming years.” Read the memo.
Fed Launches Off-Site Reviews for Electronic Loan Records
The Federal Reserve on Tuesday announced that the banking organizations it supervises with less than $50 billion in assets may choose to have Fed examiners review loan files off-site, provided the bank can transmit readable and comprehensive loan information securely. The move to streamline the exam process has been signaled by top Fed officials for years and is expected to reduce the burden that on-site exams place on the day-to-day operations of community banks.
According to Fed guidance, for banks that have demonstrated their ability to meet the security, imaging and comprehensiveness requirements, “Reserve banks should make all efforts to accommodate the request for an off-site loan review.” The Fed said it would handle submitted loan data in accordance with its existing security policies and practices. Read more.
Visa Offers Free Tech to Speed Up Chip Card Readers
Visa on Tuesday announced the launch of Quick Chip for EMV, a technology enhancement designed to speed up EMV card authorizations to two seconds or less and allow shoppers to dip and withdraw their cards instantly--just as they do with magstripe cards. The new offering would eliminate the concerns expressed by many customers--and by merchants who have refused to upgrade to EMV card readers--that chip card authorizations take too long.
Visa is making the Quick Chip specification available free of charge to merchants via their payment processors and acquiring banks. The technology is available now for Visa transactions, but Visa said it will make Quick Chip available to other payment networks to customize. It requires only a software update to the merchant’s card terminals or point-of-sale system, Visa said.
In related news, Visa released figures showing that chip cards are already having an effect on card counterfeiting. At the five largest EMV-enabled retailers, counterfeit card fraud fell by 18 percent from the end of 2014 to the end of 2015. However, only about 20 percent of all merchant locations nationwide have chip-enabled terminals. Read more.
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