Compliance Update with Amy K
by Amy Kleinschmit
Chief Compliance Officer

NCUA Webinar – Minority Depository Institutions and Financial Inclusion

The National Credit Union Administration (NCUA) will be hosting a free webinar on October 21 at 1:00 p.m. (CT) on “Pathways to Consumer Financial Well-Being: The Importance of Financial Inclusion and Minority Depository Institutions.”

Staff from the NCUA’s Offices of Consumer Financial Protection and Credit Union Resources and Expansion will detail how credit unions, specifically minority depository institutions, can provide financial products and services that help bring our nation’s most underserved communities into the financial mainstream.

Participants can submit questions at any time during the presentation or in advance by emailing The email’s subject line should read, “Pathways to Consumer Financial Well-Being.” Register for this webinar here.



The Consumer Financial Protection Bureau (CFPB) recently issued FAQs discussing topics under the Real Estate Settlement Procedures Act (RESPA) and Regulation X. The FAQs provide an overview of the provisions in RESPA Section 8 (and the respective sections in Regulation X) and they address the application of these provisions to gifts and promotional activities and also to marketing services agreements (MSAs).

As a reminder, RESPA Section 8 prohibits giving or accepting a fee, kickback, or thing of value pursuant to an agreement or understanding (oral or otherwise) for referrals of business incident to or part of a settlement service involving a federally related mortgage loan. Be sure to review these FAQs here.


IRS – Economic Impact Payments

The Internal Revenue Service (IRS) recently issued a state-by-state breakdown of nearly 9 million non-filers who will be mailed letters about Economic Impact Payments (EIP) and encouraging them to see if they’re eligible to claim an EIP.

Slightly over 19,000 individuals in both North and South Dakota will receive letters urging recipients to visit the special Non-Filers: Enter Payment Info Here tool on before the October 15 deadline to register for an Economic Impact Payment. These individuals haven't filed a return for either 2018 or 2019. Based on an internal analysis, these are people who don't typically have a tax return filing requirement because they appear to have very low incomes based on Forms W-2 and 1099, and other third-party statements available to the IRS.

The IRS cautions that receiving a letter is not a guarantee of eligibility. For more information on eligibility requirements, see the Economic Impact Payment eligibility FAQs on


CU Policy Pro Update

CU Policy Pro recently released 12 policy revisions, 1 policy addition, and 1 policy deletion. Many of the updates made this quarter were administrative or designed to increase the value of the policy.  However, some changes were made to capture formal guidance from the relevant regulatory agency, as appropriately linked below.

Policy 2111 – Hemp-Related Accounts (NEW POLICY) In order to assist credit unions more effectively, a new model policy specifically related to hemp was created.

Policy 2114 – Politically Exposed Persons (PEPs). This policy was revised to capture the latest guidance from FinCEN regarding BSA Due Diligence Requirements for Customers who may be considered politically exposed persons. 

Policy 2140 – Purchasing. This policy was substantially updated to provide more comprehensive content related to purchasing and expense authorization.

Policy 2213 – Trust Accounts. This policy was updated to include minor helpful changes.  Additionally, the reference to Unlawful Internet Gambling was removed based on the industry standard of not including Trust accounts within the “commercial account” definition.

Policy 2290 – Wire Transfers. This policy was updated to remove the reference to NACHA and ACH transactions.

Policy 2611 – ACH Management. This policy was revised to eliminate the outdated reference to the six-transaction limit under Regulation D.

Policy 3110 – Operating Charge Offs **Policy Deletion** This policy is being deleted and is considered redundant and out of date.  Currently, credit unions have access to multiple policies related to loan and account charge offs that are more comprehensive.   

Policy 7115 – Credit Underwriting Standards. This policy was revised to include the Interagency Statement on the use of alternative data in credit underwriting.

Policy 7213 – Military Personnel Loans. The Military Personnel Loans policy was updated to include the Space Force and commissioned corps of the National Oceanic and Atmospheric Administration and commissioned corps of the Public Health Service.  The policy was also updated to include the interpretive guidance Q&A that allows credit unions to utilize an ITIN to search if a borrower is covered under the MLA.  Last but not least, the previous requirement to keep the MLA disclosures separate from Regulation Z disclosures has been removed.

Policy 7218 – Payday Alternative Loans (PALs). This policy was revised as a result of the most recent final rule coming out of the CFPB on the Payday Alternative Loans that eliminated the mandatory underwriting provisions previously expected to become effective in November 2020.  As part of this rule, new commentary was provided regarding the prior exemption for the NCUA’s Payday Alternative Loan (PAL) 1, clarifying that the NCUA’s revised PAL 2 did not have the same exemption under the CFPB’s rules.  However, because of the way credit unions structure their PALs (both 1 and 2) loans, generally they will both be exempt from the CFPB’s rules.  That clarification has been added to the policy.

Policy 7362 – Temporary Policy for Loan Modifications and Reporting – COVID-19. This policy was revised to take into consideration the Joint Statement on Additional Loan accommodations Related to COVID-19.  Specifically, risk management considerations were added to assist credit unions.

Policy 7436 – CARES Act – Small Business Administration SBA Loans. This policy was revised to correct the deferral amount of the loan payments, which was extended from 6 months to 10 months. 

Policy 10012 – Record Retention – Tax Records. This policy was revised to include up-to-date guidance from the IRS regarding general instructions for information returns that a credit union may file, including employment tax recordkeeping, etc.

Policy 11002 – Furnishing Information to Credit Reporting Agencies. Revision to correct a reference.


As always, DCUA members may contact Amy Kleinschmit with any compliance related questions.


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