* ALEXANDRIA, Va. (9/2/10)--Credit unions interested in accessing the Federal Reserve Board’s sample opt-in notice for overdraft services can do so through a regulatory alert (10-RA-12)
recently posted by the National Credit Union Administration. As of Aug. 15, financial institutions are prohibited from charging consumers fees for paying overdrafts on ATM transactions and one-time debit card transactions unless consumers specifically “opt in” to overdraft services. While the alert noted that credit unions are not required to use the Fed’s sample notice, the NCUA said the model is a convenient way to provide the required notice to members. “The Fed’s easy-to-understand notice was created to raise consumers’ awareness of overdraft fees, as well as options available to reduce those fees,” the alert said … * WASHINGTON (9/2/10)--The Financial Crimes Enforcement Network (FinCEN) last week assessed a civil money penalty against a North Carolina limited liability company (LLC) for what the agency identified as a host of offenses against anti-money laundering (AML) and suspicious activity rules under the Bank Secrecy Act (BSA). Pinnacle Capital Markets, LLC, based in Raleigh--without admitting or denying either the facts or determinations of FinCEN--consented to the penalty. Among the charges alleged by FinCEN were these failures: lack of adequate internal controls combined with deficient training and independent testing, resulting in an ineffective AML compliance program not tailored to the risks of Pinnacle’s business; failure to verify the identity of customers by not obtaining required customer identification program information for accountholders; and deficiencies in the firm’s procedures and monitoring for suspicious transactions leading to failure to file suspicious activity reports in accordance with the BSA. FinCEN also determined that Pinnacle’s business model encompassed heightened AML risk due to concentrated exposure to high risk foreign jurisdictions. This civil money penalty order states that the fine will be paid in two $25,000 payments to the Treasury Department … * WASHINGTON (9/2/10)--Federal Deposit Insurance Corp. (FDIC) Chairman Sheila Bair said the agency is preparing an interim rule regarding its new resolution authority over systemically important financial institutions and nonbanks. The rule will clarify how the agency will treat creditors, Bair said (American Banker
Sept. 1). The FDIC will follow the same priority that bankruptcy court does in regards to concerns over the regulatory reform law--signed July 21--which gives FDIC flexibility to differentiate among creditors during a resolution. The authority would be used only to maximize recovery she added ... * WASHINGTON (9/2/10)--The Financial Crisis Inquiry Commission Wednesday tried to overturn the notion that Wells Fargo’s purchase of Wachovia was completed without the government’s help. During a hearing, members focused on a change to tax code made by the Internal Revenue Service (IRS) after the Federal Deposit Insurance Corp. said it would provide open-bank assistance to Wachovia (American Banker
Sept. 1). Under the deal, announced Sept. 25, 2008, the FDIC would have guaranteed Wachovia’s sale to Citigroup. A few days later, the IRS announced a change to allow banks to carry over losses from the acquisition of a troubled institution. Robert Steel, former Wachovia CEO, said the deal wasn’t a government bailout because it helped several institutions. Bill Thomas, commission vice chair, said the change was a “rifle shot,” because the IRS modified the law for a certain group of institutions. Congress later reversed the change ...