Federal banking regulators were busy last week with various proposed rules and guidance related to financial stability and regulatory measures. Meanwhile, there were also several unrelated enforcement and supervision developments, which you may have missed and we have rounded up below.
FTC lawsuit leads to charges against scammers
The owners and operators of Financial Education Services (FES), a major credit repair operation, were found to be operating a pyramid scheme during the discovery period for a lawsuit filed by the Federal Trade Commission (FTC). FES also violated the Credit Repair Organizations Act, according to the FTC. The proposed court orders include substantial monetary penalties, including $12 million in penalties to FES and fines against four individuals ranging from $215,000 to $5.5 million. The FTC first filed suit against FES in May 2022, alleging the company preyed on consumers with low credit scores by luring them in with the false promise of an easy solution. The company then would convince them to join a pyramid scheme selling the credit repair services to others, costing them millions of dollars. Learn more about the case here.
OCC releases CRA evaluations for 27 banks
The Office of the Comptroller of the Currency (OCC) released a list of Community Reinvestment Act performance evaluations made public between July 1 and July 31. The list contains national banks, federal savings associations and insured federal branches of foreign banks to receive ratings. The possible ratings are outstanding, satisfactory, needs to improve, and substantial noncompliance. Of the 27 evaluations made public this month, one is rated substantial noncompliance, 20 are rated satisfactory, and six are rated outstanding. For more details, follow this link.
Fed seeks members for Insurance Policy Advisory Committee
The Federal Reserve is seeking individuals with expertise in insurance perspectives in life, property and casualty, and reinsurance issues to serve on its Insurance Policy Advisory Committee which is comprised of 21 members, serving staggered three-year terms. Members have diverse professional backgrounds, including insurance accounting, actuarial science, academia, insurance regulation, and policyholder advocacy. The Fed selects seven individuals annually to each serve three-year terms. The Fed is allowed to select additional individuals to fill any term that is unexpired and vacated by an existing member. The deadline to apply is Oct. 7. Learn more about how to apply here.
OCC allows banks affected by hurricanes to close
In light of the unsafe conditions caused by Hurricane Debby in Florida and Georgia, the OCC issued a proclamation permitting national banks, federal savings associations, and federal branches and agencies of foreign banks in the affected area to close their offices. The OCC expects only bank offices directly affected by potentially unsafe conditions to close. The agency said those offices should make every effort to reopen as quickly as possible to address the banking needs of their customers. More information on OCC Bulletin 2012-28, “Supervisory Guidance on Natural Disasters and Other Emergency Conditions,” is available here.