Compliance Update with Amy K
by Amy Kleinschmit
Chief Compliance Officer

Elder Financial Exploitation.

The Department of Justice, Office for Victims of Crime (OVC), has created a free hotline for people to report fraud against anyone age 60 or older. The OVC explains the hotline is staffed by professionals who know how to support victims of fraud. Callers will reach a case manager who will help them through the reporting process at the federal, state, and local levels. Callers may also be connected with other resources on a case-by-case basis

Fraud and romance scams aimed at older adults resulted in losses of more than $184 million in 2018. Many crimes go unreported because victims are scared, embarrassed, or don’t know who to call. That’s why DOJ created the hotline. 

The Hotline’s toll-free number is 833-FRAUD-11 (833-372-8311)

Scam Update.

Scammers are having a field day by taking advantage of us in this time of crisis. Please be aware of the latest scams connected to coronavirus:

  • Scammers are telling people that they can get $1,000 per adult and $500 per child if they would just provide their credit card number. This provision is not in place. IF it happens, you won’t need a credit card to get it!
  • Scammers are asking people to contribute to fake charities or fake crowdfunding.
  • Scammers are telling people that banks can take your money, so buy gold instead.
  • Scammers are going door-to-door selling fake COVID-19 tests or saying they are with the CDC.

The BBB has a page with Coronavirus updates.  

The FTC (Federal Trade Commission) has a page with Coronavirus updates.

KnowBe4 is offering a Free On-Demand Webinar in response to organizations asking traditional office-based employees to work from home during the pandemic.


FFCRA Summary Article.

Be sure to review related Memo story today on Congressional Actions. Also, in case you missed it, Colleen Kelly, Senior Federal Compliance Counsel for CUNA, wrote an excellent summary for the CUNA Compliance Community of The Families First Coronavirus Response Act (FFCRA) which was passed this week. I encourage you to take time to review it here as it has important additional details on required employee notice. You will need your CUNA password to log in.



The Consumer Financial Protection Bureau (CFPB) has a series of HMDA FAQs and recently updated them to answer the following question “If a natural person applicant submits a mail, internet, or telephone application under Regulation C but does not provide race, ethnicity, or sex information, what should the financial institution report regarding whether this information was collected on the basis of visual observation or surname?” Find the answer to this and other FAQs here.


Digital ID Guidance.

The Financial Action Task Force (FATF) recently issued guidance on the Digital Identity which can be found here. As discussed in the executive summary, “Digital payments are growing at an estimated 12.7% annually, and are forecast to reach 726 billion transactions annually by 2020. By 2022, an estimated 60% of world GDP will be digitalized.”

This guidance covers a number of items including exploring some of the benefits of digital ID systems, as well as the risks they pose. The Guidance highlights a number of ways in which the use of digital ID systems for CDD can support financial inclusion. Recommendations for regulated entities are discussed as well.


CFPB Enforcement Action.

Another interesting story about a bank opening unauthorized accounts all in the name of increasing sales. Last week, the Consumer Financial Protection Bureau (CFPB) announced a lawsuit filed against Fifth Third Bank. As explained in its press release, “The Bureau alleges that for several years Fifth Third, without consumers’ knowledge or consent: opened deposit and credit-card accounts in consumers’ names; transferred funds from consumers’ existing accounts to new, improperly opened accounts; enrolled consumers in unauthorized online-banking services; and activated unauthorized lines of credit on consumers’ accounts.”

The complaint alleges that for years, and continuing through at least 2016, Fifth Third used a “cross-sell” strategy to increase the total number of products and services it provided to existing customers. To increase sales of its products and services, from at least 2010 through at least 2016, Fifth Third imposed sales goals on bank employees and implemented an incentive-compensation program that financially rewarded employees for selling new products and services. Sales goals were often set at a level higher than the anticipated sales for thousands of employees. Fifth Third used the achievement or nonachievement of sales goals as a key component in performance ratings. Low performance ratings could result in disciplinary action, including termination.

By 2010, at the latest, Fifth Third was aware that employees were opening products and services in consumers’ names without those consumers’ knowledge or consent in order to achieve sales goals or obtain incentive rewards.


CUAD members may contact Amy Kleinschmit with any compliance related questions.

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