SDBA eNews

July 15, 2021

Still Time to Register for SDBA's Ag Credit Conference Next Week

Ag Conference GraphicIt is not too late to make plans to attend the SDBA's Agricultural Credit Conference next Wednesday and Thursday, July 21-22, in Pierre at the Ramkota Hotel & Conference Center.

Session topics include the U.S. economy in 2021 and beyond, current fraud trends impacting the banking industry, cutting expenses versus increasing yields, proper loan restructuring, weather risk in production agriculture, higher prices and increased volatility in the grain and cattle markets, avoiding the pitfalls of marijuana and hemp, federal banking and policy update, and speed networking. The event will also include a networking reception on Wednesday evening and an exhibit hall. 

See the full agenda and register.

ABA Urges Bankers to Encourage Lawmakers to Co-sponsor ECORA Act

The ABA is calling on bankers to encourage their lawmakers to co-sponsor the Enhancing Credit Opportunities in Rural America Act—a bill that would promote greater access to credit and reduce borrowing costs for ag producers.

As net farm income declines, the availability of low-cost credit is extremely important to the agricultural sector, and bankers are urged to ask Congress to co-sponsor this important bill to help the nation's farmers and ranchers and revive rural ag economies. Take action now.

Biden Order Calls for Movement on Data Access Rule, Review of M&A Rules

President Biden last Friday issued a wide-ranging executive order on competition issues across the U.S. economy. Among provisions related to the financial services industry, the order calls on the Consumer Financial Protection Bureau to complete its implementation of Section 1033 of the Dodd-Frank Act and to enforce the prohibition on unfair, deceptive or abusive acts and practices consistently with Section 1031 of Dodd-Frank. The order also calls for the Justice Department and federal banking regulators to review current policies on bank mergers and for the Treasury Department to report on the effects of large tech companies’ and other nonbanks’ entry into financial services.

The CFPB last fall issued an advance notice of proposed rulemaking on Section 1033, which addresses consumers’ rights to access and control information about their accounts. “ABA and our members fully support customers’ ability to access and share their financial data in a secure, transparent manner that gives them control,” said ABA President and CEO Rob Nichols. “We have been working with the CFPB since 2017 on how to ensure consumers remain protected when they share their financial data outside of the secure banking ecosystem. The bureau’s early decision to establish guiding principles has allowed banks and technology companies to collaborate on tools that are already facilitating access to financial data in a way that protects and empowers consumers.”

As regulators and the Justice Department “revitalize” M&A oversight pursuant to the order, Nichols added that ABA “will continue to call for updating merger review guidelines to finally consider nonbank competitors, such as fintechs and credit unions, that account for a growing share of the financial services marketplace, yet don’t have to meet bank requirements for compliance and community investment, and in some cases don’t even have to pay federal taxes.”

Nichols added that “if the administration wants to see competition in action, the nation’s banking sector is a good place to start. The U.S. has the deepest and most diverse banking system in the world, with nearly 5,000 banks of all sizes, charters and business models who compete for business every day. The depth and resilience of today's banking industry was on full display during the pandemic, as banks of all sizes provided unprecedented support to their customers, communities and the broader economy, while also meeting their rigorous regulatory obligations.” Read the order. For more information, contact ABA’s Rob MorganGinny O’Neill or Hu Benton.

ABA Urges Further Action to Address Misuse of FDIC Name, Logo

The ABA urged the FDIC last week to address potentially deceptive practices by nonbank entities implying deposit insurance coverage that could mislead consumers. Responding to a notice of proposed rulemaking, ABA and the Bank Policy Institute welcomed the agency’s recognition of an increasing number of potential violations of false advertising, misrepresentation of insured status, and misuse of the FDIC’s name or logo.

ABA and BPI recommended that banks not be held responsible for third-party activities beyond the bank’s control, and they urged the FDIC to clarify the application of the proposed rules to bank communications with respect to non-deposit and hybrid products, strengthen a proposed bright-line rule for knowing misrepresentations and clarify that banks may submit complaints through the proposed process.

The associations also urged the FDIC to coordinate with other financial regulators to ensure a consistent approach, “given the diversity of the activities and businesses of nonbank entities.” Read the letter. For more information, contact ABA's Alison Touhey.

CFE Fund Announces Milestone of 100-Plus Certified 'Bank On' Accounts

The Cities for Financial Empowerment Fund announced on Monday that the number of Bank On-certified deposit accounts has surpassed 100. Newly certified accounts from BMO Harris Bank, BOM Bank and Wintrust Community Banks were among those identified by the CFE Fund as helping to reach the milestone.

There are now 108 certified accounts from institutions representing 50% of U.S. deposit market share and 40% of U.S. bank branches, the CFE Fund said. When ABA President and CEO Rob Nichols, speaking at the association’s Unconventional Convention in October 2020, challenged all banks to consider offering a Bank On-certified account, there were 43 banks offering certified accounts. Today, there are more than 80 banks offering the accounts—with substantially more participation from community banks—and many more are in the certification process. Last fall, Nichols also announced that 20 core technology providers—including Fiserv, FIS, Jack Henry and Associates and Finastra—have committed to simplify the process for their bank clients to create and offer a Bank On-certified account, facilitating community banks’ participation.

“We are thrilled to learn that more than 100 financial institutions, including a growing number of America’s banks, now offer low-cost Bank On certified accounts,” Nichols said. “We congratulate the Cities for Financial Empowerment Fund, which created the Bank On standards, for this important achievement and for the CFE Fund’s ongoing efforts to reduce the number of unbanked in the country. ABA looks forward to doing all we can to continue to support the Bank On movement and make sure everyone in the country can enjoy the many benefits that come with a bank account.”

Bank On accounts are designed to extend bank access to the roughly 5% of U.S. households that remain unbanked. Key features include low costs, no overdraft fees, robust transaction capabilities via a debit or prepaid card, and free online bill pay. Read more. Learn more about Bank On certification.  

Agencies Seek Comment on Proposed Third-Party Risk Management Guidance

The Federal Reserve, FDIC and OCC are seeking comments on a joint proposal designed to manage risks associated with third-party relationships, including relationships with nonbank fintech firms.

The agencies said the proposal would assist banks in identifying and addressing the risks associated with third-party relationships and responds to industry feedback requesting alignment among the agencies about third-party risk management guidance.

The proposed guidance takes into account the level of risk, complexity and size of the banking organization, as well as the nature of the third-party relationship, the agencies said, adding that it would replace each agency’s existing guidance on the topic and would be directed to all banking organizations supervised by the agencies. Comments on the proposal are due 60 days after publication in the Federal Register. View the proposal. For more information, contact ABA's Krista Shonk.

SDBA Women in Banking Conference Lodging Open

Lodging is now open for the SDBA's LEAD STRONG: Women in Banking Conference set for Sept. 14-15 at the Sioux Falls Convention Center. To reserve a room at the Sheraton Sioux Falls, click here. The room block will be released on Aug. 15. 

The SDBA is looking forward to seeing people face-to-face at this year's Women in Banking Conference in Sioux Falls. Be watching for the full agenda and event registration, which is coming soon. 

Learn About Impact of Incidents on Cyber Insurance and Data Security

The current threat landscape--especially in the wake of incidents like Colonial Pipeline, JBS and Kaseya--have already impacted cyber insurance and data security. 

If you are asking "where do I go from here" or "how does this impact my organization and cyber insurance policy," then join Marco on Thursday, Aug. 5, at noon CDT to get the answers to those questions. Join speakers from Marco, Marsh & McLennan Agency, LLC and VLP Law Group LLP for a virtual meeting via Webex as they discuss the impact of incidents on cyber insurance and data security.

Learn more and register


Question of the Week

Question: For a debt-collector within the meaning of the FDCPA, what are some of the restrictions around communicating with a borrower regarding a debt?

Answer: The FDCPA, § 805, sets forth the following procedural requirements that apply to debt-collectors within the meaning of the Act: 1) No calls before 8AM or after 9PM, unless you have specific knowledge of circumstances to the contrary; 2) If the debtor is represented by an attorney, the credit must communicate with the attorney, not the debtor; 3) do not call them at their place of work; 4) Communication MUST cease upon request; and 5) without prior consent, do not inform a third-party that the borrower owes debt and that you are trying to collect.

(a) Communication with the consumer generally

Without the prior consent of the consumer given directly to the debt collector or the express permission of a court of competent jurisdiction, a debt collector may not communicate with a consumer in connection with the collection of any debt --

(1) at any unusual time or place or a time or place known or which should be known to be inconvenient to the consumer. In the absence of knowledge of circumstances to the contrary, a debt collector shall assume that the convenient time for communicating with a consumer is after 8 o'clock antemeridian and before 9 o'clock postmeridian, local time at the consumer's location;

(2) if the debt collector knows the consumer is represented by an attorney with respect to such debt and has knowledge of, or can readily ascertain, such attorney's name and address, unless the attorney fails to respond within a reasonable period of time to a communication from the debt collector or unless the attorney consents to direct communication with the consumer; or

(3) at the consumer's place of employment if the debt collector knows or has reason to know that the consumer's employer prohibits the consumer from receiving such communication.

FDCPA, §805(a), (b), and (c), 

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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 and ask for our Membership Team.

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Contact Alisa Bousa, SDBA, at 605.224.1653 or via email.