Fair Lending & Complaint Hot Buttons

I just returned from the 2013 ABA Regulatory Compliance Conference and took away lots and lots of good BSA Training and Banking Regulations Compliance Consulting jerod11 - Fair Lending & Complaint Hot Buttonsinformation.  Two topics in particular stuck with me…  Fair Lending and Consumer Complaints.

I don’t believe I attended a session where the words “fair lending” didn’t come up.  It seemed as though every topic came with a fair lending caveat or disclaimer.  My take-aways regarding fair lending were:

  1. Disparate Impact

Make certain Management and the Board understands what it is, where it could occur in your bank and what to do about it.

2.  Disparate Treatment

Lender discretion MUST be justified, monitored and controlled.

By now you’ve probably figured out that the Consumer Financial Protection Bureau (CFPB) has a thing for complaints.  If you’re not sure what I’m getting at, a simple Google of the term “CFPB” and “complaint” should get you up to speed. So what does this mean for your financial institution?  My take, after attending the ABA Conference, is you need to be prepared to discuss and demonstrate how your financial institution monitors and manages complaints.  The key points I jotted down were:

  1. “Covered” complaints aren’t just those that are put in writing.  The CFPB is painting with a much broader brush and with an expectation that any complaint (written or verbal) be documented and addressed.
  2. Documentation, resolution, tracking and Board/Management oversight will be key components necessary to demonstrate effective complaint management.

    Published
    2013/06/20
    Jerod Moyer

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