An Oklahoma-based bank has been hit with a consent order from the FDIC after posting significant losses in its first year of operation. On June 28, the FDIC announced that it took an enforcement action against the bank mandating it to increase its capital reserves, revise its business strategy, and implement technology-based audit policies.Continue Reading Oklahoma Bank Faces FDIC Consent Order
On March 28, the FDIC released the spring edition of its consumer compliance supervisory highlights. The FDIC supervises approximately 3,000 state-chartered banks and thrifts that are not members of the Federal Reserve System. Most of these institutions are community banks that provide credit and services locally. Like the CFPB, the FDIC conducts supervisory activities, including examinations, to review institutions’ compliance management systems. Its examination focuses on identifying the greatest potential risk of harm to consumers, based on the business model and products offered by a particular institution. The FDIC’s report highlights consumer compliance issues identified by the agency’s examination of close to 900 institutions in 2023. While the entire report is worth a read, here are some key areas of focus:Continue Reading Takeaways From the FDIC’s Spring 2024 Consumer Compliance Supervisory Highlights
On January 30, a Tennessee-based community bank entered into a consent order with the Federal Deposit Insurance Corp. following the agency’s allegations that the Bank engaged in unsafe or unsound banking practices relating to its third-party risk management practices with its fintech partners. While the order does not list the FDIC’s concerns with the bank’s third-party partnerships, the order requires it to come up with a plan within 60 days to end its relationship with its “significant third-party fintech partners.” In addition, the bank must implement a program to evaluate and manage the risks associated with the fintechs it directly works with, and fintechs with whom its direct partners work. Continue Reading FDIC Issues Consent Order Against Tennessee Bank
On December 21, the Office of Inspector General (OIG) of the FDIC issued its audit memorandum on the FDIC’s Regional Service Provider (RSP) Examination Program. The OIG’s objective was to assess the effectiveness of the FDIC’s RSP Examination Program related to third-party risks to banks, including for compliance with interagency service provider guidance (we discussed this final guidance in a previous blog post here).Continue Reading OIG Issues Audit Memorandum to FDIC’s Regional Service Provider Examination Program, Impacts Fintechs