November 9, 2015 10:13 am

By: Mikel Dunnagan

In its most recent version of Supervisory Highlights (or lowlights as some may say), the CFPB announced its exam findings for both the second and third quarters.  While the CFPB is responsible for examining financial institutions with assets greater than $10 billion, stuff generally tends to run downhill.  So, you should expect these points of examination focus coming soon to an examiner near you.

In addition to patting themselves on the back for generally beating up the schoolyard bully (bankers) turning them upside-down and shaking the change out of their pockets (to the tune of over $1 billion), the report goes on to note examination emphases in the following areas of interest to community bankers:

  • Consumer Reporting
    • Failure to have policies and procedures addressing accuracy and integrity with respect to furnishing information on deposit accounts
    • Adverse action notices to consumers that failed to include the name, address and telephone number of the CRA that provided the information relied upon
    • Failure to monitor and track direct FCRA disputes received from consumers and indirect FCRA disputes they received from CRAs
  • Mortgage Origination
    • Violation of Reg. X tolerances
    • Failure to document reasons for issuing a new GFE due to changed circumstances
    • Settlement statement inaccuracies in dollar amounts and identification of proper payee for a particular service charge
    • Third party fees not matching corresponding invoices
    • Failure to provide homeownership counseling disclosures
    • Inaccurate privacy notices that didn’t accurately describe a bank’s privacy practices or identify bank affiliates
    • Failure of appropriate employees to be registered with the NMLS
  • Mortgage Servicing
    • Inadequate policies and procedures to address:
      • Dealing with the death of a borrower and subsequent communication with successors in interest
      • The bank’s loss mitigation process
      • The bank’s loss mitigation options available to borrowers
      • Handling foreclosure proceedings
    • Failure to comply with the regulatory requirements of loss mitigation
    • Failure to terminate PMI within the appropriate time period and refund unearned PMI premiums.
  • Fair Lending
    • Underwriting disparity in loan granting and denials.

To read to full Supervisory Highlights, please visit,