Federal Financial Institutions Examinations Council (FFIEC)
Financial Regulators Update Examiner Guidance on Financial Institutions’ Information Technology Development, Acquisition, and Maintenance
The FFIEC has issued a new booklet to help examiners assess information technology practices. The “Development, Acquisition, and Maintenance” booklet will provide examiners with fundamental examination expectations regarding entities’ development and acquisition planning and execution, governance and risk management, and maintenance and change management practices.
The booklet will reflect changes in the technological environment and the increasing need for security and resilience. It will also highlight the importance of providing examiners with current information regarding safety and soundness, consumer protection, and provision of secure and resilient business services to consumers.
This booklet will replace the existing, “Development and Acquisition” what was issued in April 2024.
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Consumer Financial Protection Bureau (CFPB)
CFPB Ordered NewDay USA to Pay $2.25 Million for Illegally Luring Veterans and Military Families into Cash-Out Refinance Loans
The CFPB has taken action against New Day Financial for repeatedly deceiving active duty servicemembers and veterans seeking cash-out refinance loans. It was found that NewDay USA provided misleading and incomplete cost comparisons to borrowers refinancing in North Carolina, Maine, and Minnesota, making the company’s loan appear less expensive relative to their existing mortgages. The CFPB has now ordered NewDay USA to pay a $2.25 million civil penalty to the CFPB’s victims relief fund.
New Day Financial, LLC is a non-bank direct mortgage lender that specializes in offering mortgage loans guaranteed by the United States Department of Veterans Affairs (VA). The company currently operates under the brand name NewDay USA and utilizes patriotic imagery to lure military customers.
The CFPB, VA, and Ginnie Mae all have previously taken action against NewDay USA over concerns of loan churning. Ginnie Mae limited the lender’s ability to package and sell these loans to investors while the VA has taken significant steps to rein in churning activities. In 2015, the CFPB acted against NewDay for paying illegal kickbacks and deceiving borrowers about a veterans’ organization’s endorsement of NewDay USA products.
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League InfoSight Highlight: Let's Have a Conversation
September is National Preparedness Month and the theme for 2024 is “Start a Conversation.” Discussing preparedness can be difficult because it is focused on events that may disrupt our lives and cause trauma to those we love. It is, however, vital to have these conversations as they are the foundation on which we build the learnings and actions needed to prepare.
Understanding the various threats to our families, communities, and workplaces that exist where we live, work, and travel is a critical first step in the preparedness process. These threats can be environmental, physical, technical, or political. They can be caused by accidental or deliberate actions, can be fast occurring or develop slowly, and can be readily apparent or difficult to discover. Some threats may be newsworthy events impacting thousands or millions, while others may impact only a handful of individuals and go virtually unnoticed.
Ready.gov is a great resource to initiate these conversations. It offers information about common hazards and safety tips for before, during, and after an event. There are also tools to help create an emergency plan for your family, set up local warnings and alerts, identify
evacuation options for you and your pets, stock emergency kits with necessary supplies, backup power options to keep medical devices running and store medications, and safeguard important documents and treasured possessions.
In the credit union community, events that impact our facilities, systems, and people can affect our ability to deliver critical financial services to our members, especially during a disaster. This reinforces the importance of starting preparedness conversations.
But preparedness does not stop there! Conversations build engagement, leading to plan development. These plans must be kept current through ongoing validation and maintenance and made more effective through training and awareness. These activities, combined with ongoing conversations at every stage of the process, are vital to achieve and maintain preparedness. As new threats emerge, processes evolve, new technologies are implemented, and member needs change over time, continued conversations will enable your credit union to adapt and enhance your preparedness efforts.
RecoveryPro is an effective tool credit unions can utilize to plan and prepare for disruptions. Content is divided into individual activity sections to make the preparedness process more manageable and is supported by a wide variety of documentation, training, and resources. RecoveryPro can assist credit unions of any size build and maintain a robust Business Continuity Program.
National Preparedness Month is also a good time to check/change batteries in smoke detectors, inspect fire extinguishers, review and test evacuation and shelter-in-place plans, review and update your family emergency plan, update credit union call trees, vendor contacts, and business processes, publish and share updated plan documentation, conduct annual preparedness training and tabletop exercises, and start (or continue) the conversation.
At League InfoSight, we are here to help. If you have any questions or need additional information or assistance with your credit union’s business continuity plan, please feel free to contact us at info@leagueinfosight.com.
Bill Ashland
AVP, Business Continuity
Synergent
(RecoveryPro Content Expert & Partner)
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