By Elva Coffey-Sears, CRCM
Managing regulatory change has never been more challenging than it is today. On a daily basis, we are bombarded with news reports that the new administration will roll back recent regulatory changes. Thus far, it has mandated reviews of regulations implemented in response to the 2008 financial crisis, ordered delays in implementation of recent regulations and regulatory amendments, and challenged the leadership and infrastructure of financial regulatory agencies. What’s a compliance officer to do?
Stay focused! Remember, regardless of what POTUS says, substantive changes in financial regulation cannot happen without Congress.
But wait, you say, the January memorandum to freeze new and pending regulations resulted in delays in certain proposals. This action is fairly common for a new administration with a change in the controlling party. This action can delay release and/or push back effective dates for new regulations, but it cannot change regulations that have already been implemented.
Stay focused! Monitor the notices published by the CFPB and your primary functional regulatory agency. These notices include proposed rules, requests for comment, and final rules and represent your call to action. Review the proposals to determine potential impact on your institution, respond to requests for comment either individually or in conjunction with industry trade groups such as the ABA or state banking associations, and develop implementation plans for final rules.
Stay focused! Follow proposed bills in the House and Senate – this is where regulatory change starts. Each proposal is assigned to a committee for review and to determine whether to recommend approval as written, revise and recommend approval, or to discontinue consideration of the bill. If the bill is approved, it is codified as a Statute and technically becomes enforceable. The statute delegates rulemaking authority to a specific agency and a regulation is born. Each regulation must follow the process established by the Administrative Procedures Act, which includes notice requirements by the issuing agency.
An effective change management program coupled with routine monitoring of vital information sources provides a strong foundation to an effective compliance risk management program.
ABS is here to assist with your compliance needs! Contact us at (405) 607-7000.