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Compliance CTRs and joint account withdrawals

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WASHINGTON (1/17/08)--A credit union member withdraws $15,000 in cash from the joint account he shares with his wife. In completing a currency transaction report (CTR), must the credit union list only the individual who made the withdrawal or all of the owners on the account? This question currently is the subject of much debate, according to the Credit Union National Association's (CUNA) Compliance Challenge. For years, financial institutions--both credit unions and banks--were advised to complete CTRs for withdrawals on joint accounts with only the information of the individual completing the transaction, unless there is reason to believe that the other joint owners on the account will benefit from the withdrawal. However, some institutions are being advised to assume all joint owners are benefiting from the withdrawal, which means all should be listed on the CTR form. This latter position appears to be based on an older piece of Financial Crimes Enforcement Network (FinCEN) guidance, which is embedded in an inactive FDIC Financial Institution letter, according to the Challenge. CUNA recently received clarification that the FinCEN guidance remains active and is considered standing authority on this particular issue. The association said FinCEN is expected to issue clarification on this issue in the near future.

Inside Washington (01/16/2008)

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* WASHINGTON (1/17/08)--At least 10 states are pushing mortgage reform legislation as the foreclosure crisis continues. They include California, Maine, Indiana, Utah, Illinois, Maryland, New Hampshire, West Virginia, New York and Kentucky (American Banker Jan. 16). California’s Assembly could pass three mortgage bills by February, and the state’s Senate Banking Committee was scheduled to question several major lenders on loan modifications Wednesday. The committee also was expected to approve a bill that would give borrowers the opportunity to work out loan problems with lenders before foreclosure, lengthening the notification period and assessing fines of $1,000 per day to lenders who do not maintain foreclosed homes. Maine’s legislature also has amended a predatory lending bill this month that the state passed last year. State action is necessary, said Kevin Stein, associate director at the California Reinvestment Coalition. He said that his organization receives daily complaints from agencies and borrowers who cannot successfully deal with loan servicers ... * WASHINGTON (1/17/08)--Third parties are not liable for fraud claims if investors did not rely on those parties’ statements, the Supreme Court ruled Tuesday. The case involved Stoneridge Investment Partners, which claimed that Scientific Atlanta and Motorola Inc. inflated prices for Charter Communications cable boxes so that suppliers could use the extra money to buy advertising from Charter. Senate Banking Committee Chairman Christopher Dodd (D-Conn.) criticized the court’s decision, stating that the decision would protect “wrongdoers.” Conversely, Rich Whiting, executive director of the Financial Services Roundtable, supported the ruling, saying that its rejection would have triggered other allegations ... * WASHINGTON (1/17/08)--National Credit Union Administration Chairman JoAnn Johnson announced that the HOPE NOW hotline is featured on MyMoney.gov. The hotline gives homeowners access to Department of Housing and Urban Development-approved credit counselors ... * WASHINGTON (1/17/08)--Credit Union Development Educators (CUDE) volunteers will pack 15,000 meals on March 2 from 9 a.m. to noon at the Credit Union National Association (CUNA) Governmental Affairs Conference in Washington, D.C. as a part of “Stop Hunger Now.” The project is seeking donations to cover the cost of the meals. The program is presented by the National Credit Union Foundation with support from World Council of Credit Unions, CUNA and CUNA Mutual Group ...