Reg CC Notice of Hold-"Exceptions/Knowledge Gaps"

Question:

When doing a Reg. CC review, holding funds for too long or too much constitutes a clear violation. What if, for example, the Notice of Hold was not completed properly (placed big "X" through all reasons as if to say N/A to all, or they simply selected no reasons, or left out the number of days funds would be held). I've received feedback advising these are not violations, just "exceptions/knowledge gaps" and on a review should be listed as such.

Answer:

A rose by any other name would smell as sweet... Shakespeare

A violation by any other name is still a violation. Your regulators and third party reviewers may or may not find the distinction you have been offered amusing and may question the value of the audit and the feedback being provided to the bank.

I'm fascinated by euphemisms and the psychology behind them. Once I dealt with a bank that could not bring enough pressure to bear to homogenize its compliance procedures among its different offices. They called them "branch variations." I just called them sloppy.

First published on BankersOnline.com 1/14/13