Top Stories for November 2003

The OCC, the SEC, and the New York Attorney General have jointly announced a series of actions against Phoenix, Arizona-based Security Trust Company, N.A. and three former executives, arising from their participation in mutual fund late trading and market timing schemes. The bank will begin a process that will result in an orderly dissolution by March, 31, 2004.OCC NR    SEC PR    Consent Order 11/26/03

CMP Assessed For BSA and AML Violations

FinCEN has assessed a $10,000 civil money penalty against a Georgia financial institution for willful violations of the BSA and AML Program requirements regarding correspondent accounts.Assessment 11/26/03

FinCEN Issues Two NPRs

FinCEN has issued one notice of proposed rule making regarding the imposition of special measures against Burma as a jurisdiction of Primary Money Laundering Concern and a second notice regarding Myanmar Mayflower Bank and Asia Wealth Bank as financial institutions of Primary Money Laundering Concern. Burma NPR    Banks NPR 11/26/03

Counterfeit Cashier's Checks Special Alert

The FDIC has issued a Special Alert regarding counterfeit cashier's checks issued by Affinity Bank, Ventura, California; Capital Bank & Trust Company, Nashville, Tennessee; and Suburban Bank & Trust Company, Elmhurst, Illinois. Details regarding the counterfeit cashier'
s checks and contact information have been placed on the BOL Alerts & Counterfeits page. 11/26/03

International Reserve Position

Treasury has released the U. S. International Reserve Position for the week ending November 21.Reserve Position 11/26/03

OTS Issues 2003 Financial Report

The 2003 Financial Report has been issued by OTS.OTS Financial Report 11/26/03

Thrift Charge-Off Rates Released

OTS has released the thrift industry charge-off rates by asset types report for the third quarter 2003.Charge-Off Rates 11/26/03

USA PATRIOT Act Section 311 Designations

Published in the Federal Register the Treasury has announced the designation of Burma and two Burmese banks to be of "primary money laundering concerns" under Section 311 of the USA PATRIOT Act and a notice of proposed rulemaking that would require U.S. financial institutions to terminate correspondent accounts involving Burmese financial institutions, subject to certain specified exemptions. This announcement previously appeared on 11/20/03 on BOL. 68FR66305 (txt)    68FR66305 (pdf)    68FR66299 (txt)    68FR66299 (pdf) 11/25/03

Injunction Against MasterCard Issuer

The FTC has charged Platinum Universal, LLC, its principals, and its successor, Pulsar Data, Inc. with violating the FTC Act and the Telemarketing Sales Rule in connection with the offer of credit cards to consumers for an advance fee. The FTC alleges that the defendants falsely represented to English- and Spanish-speaking consumers that they would obtain a credit card after paying the defendants a fee, when, in fact, consumers did not receive a credit card. The defendants have stipulated to a preliminary injunction which appointed an individual to monitor all of the past, present and future activities, assets and financial transactions of the corporate defendants. Court Documents 11/25/03

OFAC Interim Rule

OFAC is amending the Iraqi Sanctions Regulations to incorporate a general license authorizing U.S. financial institutions to transfer certain claims against the Government of Iraq for unpaid loans and other debts to their home offices or to other foreign offices of the same institution. 68FR65844 (txt) 68FR65844 (pdf) 11/24/03

SAR Preparation Guidance Issued

FinCEN has issued a three part guidance package designed to provide assistance in the preparation of SARs to provide more useful narrative information to the authorities. Guidance 11/24/03

FRB Issues Order of Prohibition

The FRB has announced the issuance of a Final Decision and Order of Prohibition against Garfield C. Brown, Jr., a former employee of Mellon Bank, N.A., Pittsburgh, Pennsylvania.Final Decision    Order 11/24/03

OTS Updates Holding Companies Handbook

OTS has issued a regulatory bulletin which updates the Large and Complex Enterprises (Conglomerates) section of the Holding Companies Handbook. RB 35 11/24/03

FedImage Services Check Image Retrieval

The Federal Reserve has integrated FedImage Services with several home banking applications, including Fiserv's GalaxyPlus Netbranch, Fiserv's IntegraSys Virtual Branch and Worldwide Interactive Services' Your MSR.com to support image access. This integration enables customers of financial institutions to retrieve check images from the Federal Reserve's national archive.GalaxyPlus    IntegraSys    Worldwide 11/24/03

SARs and EAs Regarding Individuals

The FRB has issued a SR letter concerning SARs and Enforcement Actions against individuals. The Special Investigations Section of the Division of Banking Supervision and Regulation has recently had its responsibilities expanded and is now responsible for enforcement actions against current and former officers, directors, employees and other institution-affiliated parties. This SR letter provides guidance to Reserve Banks regarding the coordination of enforcement matters with the Special Investigations Section once a SAR against an institution-affiliated party has been identified for follow-up action. SR Letter 03-20 11/21/03

Change in Control Procedures Guidance

A SR Letter has been issued by the FRB regarding guidance on change in bank control procedures. The letter identifies when an individual or other affected party should contact the Federal Reserve regarding the filing of a notice under the Change in Bank Control Act and the Board's implementing regulations. SR Letter 03-19 11/21/03

Thrift Regulatory Handbook Updated

OTS has issued a Regulatory Bulletin which updates the Capital Adequacy section of the Thrift Regulatory Handbook.RB 32-31 11/21/03

OTS Publishes Instructions for March 2004 TFR

The new instructions are for only new, modified, or renumbered lines for the March 2004 TFR. 11/21/03

Greenspan - International Impact of the Deficits

Read the comments of Chairman Greenspan at the 21st Annual Monetary Conference regarding the impact of the U.S. trade deficits on the world economy and learn why he feels that current imbalances may be defused with little disruption.Speech 11/21/03

SARs to be Filed by Brokers and Merchants

FinCEN has announced a Final Rule that amends BSA to define futures commission merchants and introducing brokers in commodities as

financial institutions and requires them to file SARs with FinCEN. Final Rule 11/21/03

USA PATRIOT Act Section 311 Designations

Treasury has announced the designation of Burma and two Burmese banks to be of "primary money laundering concerns" under Section 311 of the USA PATRIOT Act and a notice of proposed rulemaking that would require U.S. financial institutions to terminate correspondent accounts involving Burmese financial institutions, subject to certain specified exemptions. Designation 11/20/03

Federal Register Publishes BSA Changes

The amendments add futures commission merchants and introducing brokers in commodities to the regulatory definition of ‘‘financial institution'
'
and require that they report suspicious transactions to FinCEN. 68FR65392 (pdf) 68FR65392 (txt) 11/20/03

2003 National Money Laundering Strategy

Treasury has issued the 2003 National Money Laundering Strategy which expands the framework for identifying, disrupting, and dismantling global terrorist financing and money laundering operations. National ML Strategy 11/20/03

FTC Files Lawsuit Against AmeriDebt

The FTC has filed a complaint in federal court charging that a national organization that promotes itself as a non-profit credit counseling agency is engaged in deceptive practices. The complaint contends that the organization failed to provide privacy notices to consumers as required by the GLB Act and misrepresented that they charge no up-front fee for their services, that they operate as a non-profit, and that they teach consumers how to handle their finances. Complaint 11/20/03

December 2003 FFIEC 030 Report Online

The FFIEC 030 Report Form for December 2003 along with instructions has been posted online.030 Report Form Instructions 11/20/03

Third Quarter Thrift Earnings Strong

The OTS has announced that the nation'
s thrift industry reported net income in the third quarter of 2003 was up 16 percent from the third quarter of 2002 which made it the second best earnings quarter in history. Thrift Earnings 11/20/03

International Reserve Position

Treasury has released the U.S. reserve assets data for the week ending November 14, 2003.International Reserve Position 11/19/03

Highly Profitable Thrifts Report

OTS has released a special report reviewing the characteristics of highly profitable community thrifts.Report 11/19/03

FinCEN Receives Over 6,900 314(a) Responses

FinCEN has announced that from February through October of 2003, financial institutions had provided 6,987 responses to 314(a) requests. The information is contained in the November 2003 SAR Activity Review – Trends, Tips & Issues, Issue 6, which was released on November 17, 2003. SAR Activity Review 11/18/03

December HOEPA APR Reference Rates

The Federal Reserve has posted the new reference rates which lenders must use to determine if loans for which applications are received in December will be subject to HOEPA under the APR trigger test. Use the FRB H.15 to find applicable release which lists the Treasury Security with the same maturity term as your loan. To make the calculation, you use the yield in effect on the 15th of the month that precedes the month you received the application. H. 15 Daily Rates H. 15 Weekly Rates 11/18/03

GLB Report To Congress

As required by GLB Section 103(d), the FRB and Treasury have presented a report to Congress which discusses the new or expanded activities conducted by financial holding companies under the GLB Act, the actions that the Board and the Secretary of the Treasury have taken to expand the activities permissible for financial holding companies, and the effect that any nonbanking mergers and acquisitions by financial holding companies under the Act have had on market concentration. Report to Congress 11/18/03

Morgan Stanley To Pay Customers $50 Million

The SEC has announced the institution and simultaneous settlement of an enforcement action against Morgan Stanley DW Inc. (Morgan Stanley) for failing to provide customers important information relating to their purchases of mutual fund shares. As part of the settlement, Morgan Stanley will pay $50 million in disgorgement and penalties, all of which will be placed in a Fair Fund for distribution to certain Morgan Stanley customers. Settlement Order 11/18/03

Counterfeit And Stolen Checks Special Alert

The FDIC has issued a Special Alert regarding counterfeit cashier's checks issued by Shoreline Bank, Shoreline, Washington and The First National Bank of Sonora, Sonora, Texas. In addition, Heartland Community Bank, Franklin, Indiana, has reported that 1,200 checks marked

loan proceeds have been stolen. Details regarding the counterfeit cashier'
s checks and the stolen checks along with contact information have been placed on the BOL Alerts & Counterfeits page. 11/18/03

FIL Regarding Announced SDGTs

The FDIC has issued FIL 89-2003 concerning SDGTs that were added to and those that were removed from the OFAC list on November 10, 2003. Information regarding the changes was previously announced in a BOL Special OFAC Alert and placed on the BOL OFAC Page. 11/18/03

Acronyms Reference Sheet

FinCEN has placed a list of commonly used acronyms for government agencies; U.S. statutes, laws and reports; and organizations on its Web site. Acronyms 11/18/03

IRS Brochures Explain 501(c)(3) Exemption

The IRS has published two new brochures to help charities understand the tax laws conferring tax-exempt status. One brochure is designed to help prospective charities apply for tax exemption under the tax law. The other is a compliance guide that explains the record keeping, return filing and disclosure rules for those organizations. Applying For 501(c)(3) 501(c)(3) Compliance Guide 11/18/03

November FEDS Papers Released

The FRB has released five new papers in the Finance and Economic Discussion Series on the following topics: The Excess Sensitivity of Long-Term Interest Rates: Evidence and Implications for Macroeconomic Models; Welfare Effects of Tax Policy in Open Economies: Stabilization and Cooperation; Estimating the Worldwide Volume of Counterfeit U.S. Currency: Data and Extrapolation; Bank Risk Ratings and the Pricing of Agricultural Loans; and Capital Flows Among the G-7 Nations: A Demographic Perspective.Excess Sensitivity    Welfare Effects    Estimating    Bank Risk    Capital Flows 11/18/03

OCC Enforcement Actions Announced

The OCC has announced 12 new enforcement actions taken against national banks and individuals currently and formerly affiliated with national banks. Enforcement Actions 11/17/03

CRA Evaluations Released By OCC

The OCC has released a list of CRA performance evaluations made public from October 15, 2003 through November 14, 2003. Of the 46 evaluations released, 8 were outstanding and 38 were satisfactory. None were needs to improve or substantial noncompliance.OCC CRA Evaluations 11/17/03

OTS CRA Ratings Released

OTS has released the CRA ratings for savings associations that were evaluated in October 2003. Of the 23 associations evalutated, 6 were rated outstanding and 16 were satisfactory. One was needs to improve and none were substantial noncompliance.OTS CRA Evaluations 11/17/03

OTS Comment Letters

OTS has added to its Web site the most recent comment letters it has received in response to proposed regulations.OTS Comment Letters 11/17/03

NCUA Issues Prohibition Orders

NCUA has issued Orders of Prohibition against three former officers and employee of credit unions in Hawaii, New Jersey and Massachuettes.Orders of Prohibition 11/17/03

November Interpretations and Actions Online

The OCC has placed the November 2003 issue of Interpretations and Actions online.Electronic Interpretations and Actions 11/17/03

October G.17 Statistical Release

The FRB has issued the G. 17 Industrial Production and Capacity Utilization statistical release for October 2003.October G. 17 11/17/03

FRB Bulletin Featured Article Announced

The FRB has selected "Global Integration in the Banking Industry " as the featured article from the November 2003 FRB Bulletin.Featured Article 11/17/03

OCC Publishes FY 2003 Annual Report

The OCC has published its 2003 Annual Report which lists accomplishments in supervision, regulation, risk analysis and chartering. It also describes management initiatives, financial management results and OCC partnerships and outreach to industry, community and consumer organizations.OCC Annual Report 11/17/03

Cost of Funds Reports Released

The OTS has released the historical and current reports regarding the cost of funds for OTS regulated SAIF insured institutions.Historical Report     Current Report 11/17/03

Texas Bank Must Refund Fees and Interest

The OCC has announced a precedent-setting enforcement action that requires the complete reimbursement of fees and interest charged by Clear Lake National Bank of San Antonio, Texas, in a series of predatory loans. The OCC found that the loans violated the HOEPA, TIL, and RESPA. The Consent Order entered into by the bank'
s new owners requires $100,000 to be paid in restitution to 30 or more borrowers.Consent Order 11/14/03

EO Indebtedness Report On FFIEC Web Site

The FFIEC has posted the December 2003 Executive Office Indebtedness Report Form with Instructions on its Web site.Report Form 11/14/03

OCC To Allow Florida Banks To Close

The OCC has issued a proclamation allowing national bank offices to close during the week of November 17, 2003, if events related to the Ministerial Meeting of the Free Trade Area of the Americas in Miami, Florida, should necessitate such action.Proclamation 11/14/03

HMDA Contacts Updated

The St. Louis Fed has placed updated OCC District Offices and HUD contact information on its HMDA Help site.Contact Information 11/13/03

Fairbanks Capital Refunds $40 Million

The FTC has announced settlements with Fairbanks Capital Holding Corp., its subsidiary, and their founder and former CEO resulting in payments of over $40 million in refunds to consumers. In a complaint filed in federal district court, the FTC and HUD charged Fairbanks with engaging in a variety of unfair, deceptive, and illegal practices in the servicing of subprime mortgage loans.Court Documents 11/13/03

FTC Consumer Rights Brochure

The FTC has issued a consumer brochure, "Mortgage Servicing: Making Sure Your Payments Count", to help consumers understand their rights. The brochure explains mortgage servicers' responsibilities, in particular under RESPA.Consumer Brochure 11/13/03

FIL Regarding Announced SDGT

T
he FDIC has issued FIL 87-2003 concerning a SDGT that was added to the OFAC list on October 31, 2003. Information regarding the SDGT was previously announced in a BOL Special OFAC Alert and placed on the BOL OFAC page. 11/13/03

International Reserve Position

Treasury has released the U.S. reserve assets data for the week ending November 7, 2003.Reserve Position 11/13/03

G.17 Revision Report Released

The G.17 (419) 2003 Historical and Annual Revision of the Industrial Production and Capacity Utilization report has been released by the FRB. The index of industrial production and the related measures of capacity and capacity utilization for the period from January 1972 to September 2003 has been revised. G.17 Revision 11/11/03

OFAC Change Added SDGT

As noted in Monday's BOL OFAC Alert, OFAC has added fifteen entries as Specially Designated Global Terrorists and removed three entries from the SDN list. Information regarding the entry and AKAs has been added to the BOL OFAC page. 11/11/03

OFAC Civil Penalties Against Eleven Banks

OFAC has issued the November list of civil penalties and informal settlements regarding violations of OFAC Sanctions Programs. Eleven banks were cited for violations of programs concerning Sudan, Iran, Libya and Cuba with penalties ranging from $2,684 to over $158,000.OFAC Civil Penalties 11/10/03

Counterfeit Cashier'
s Checks Special Alert

The FDIC has issued a Special Alert regarding counterfeit cashier's checks issued by Cornerstone Community Bank, St. Petersburg, Florida; Cache Bank & Trust, Greeley, Colorado; and HomeStreet Bank, Seattle, Washington. Details regarding the counterfeit cashier'
s checks and contact information have been placed on the BOL Alerts & Counterfeits page. 11/10/03

G. 19 Consumer Report Released

The FRB has released the September 2003 G. 19 Consumer Credit report which indicates that the rate of consumer credit growth increased in the Third Quarter. G. 19 11/10/03

Greenspan'
s Economic Outlook

Chairman Greenspan discussed his outlook for the US economy at the Securities Industry Association annual meeting. Greenspan Speech 11/7/03

SOD Updates Online

The FDIC has placed the June 30, 2003 Summary of Deposits data for more than 85,000 branches/offices of FDIC-insured institutions online. SOD Data 11/7/03

IRS Launches Online Tools

The IRS has launched the first of a suite of Internet-based business tools know as e-services that give financial institutions and tax professionals easier access to client information. The tools will provide new choices for working electronically with the IRS. The first three products provide a foundation for future services that will significantly enhance how the IRS does business with those who file selected information returns, such as banks and other financial institutions. E-Services 11/7/03

CRA Ratings Released

The FDIC has issued its monthly list of state nonmember banks recently evaluated for compliance with the CRA. The list covers evaluation ratings that the FDIC assigned to institutions in August 2003. CRA 11/6/03

FRB Written Agreement With Virginia Bank

The FRB has announced the execution of a Written Agreement by and among the Bank of Gassaway, Gassaway, West Virginia; the West Virginia Division of Banking, Charleston, West Virginia; and the Federal Reserve Bank of Richmond.Written Agreement 11/5/03

Flood Violation Civil Money Penalty

The FRB has announced the issuance of a consent Order of Assessment of a Civil Money Penalty in the amount of $4,550 against the Gulf Bank, Miami, Florida in connection with alleged violations of FRB Regulations implementing the National Flood Insurance Act. Order 11/5/03

HMDA Help Page Updated

The HMDA Help page maintained by the St. Louis Fed has been updated to include high-cost mortgage worksheets, added a link to the standard disclosure, added new FAQs and modified the definition to Syntactical Edits.Updates 11/5/03

SEC Adopts Corporate Governance Standards

The SEC has approved new rules proposed and adopted by the New York Stock Exchange and the NASDAQ Stock Market requiring widespread strengthening of corporate governance standards for listed companies. The new rules establish a stricter, more detailed definition of independence for directors and require the majority of members on listed companies' boards to satisfy that standard.SEC Rules 11/5/03

FDIC Sets 2004 Bank Assessment Rates

The FDIC has announced the assessment rates charged to insured banks and savings associations for the first half of 2004.Assessment Rates 11/5/03

BIF and SAIF Third Quarter Financials

The FDIC has released the Third Quarter 2003 financial results for the Bank Insurance Fund and the Savings Association Insurance Fund.BIF & SAIF Third Quarter 11/5/03

Emerging Risks in Banking Reviewed

The FDIC FYI for November contains a paper entitled

Economic Conditions and Emerging Risks in Banking that was provided to the FDIC Board as part of the FDIC insurance funds outlook and premium rate recommendations for the first semiannual period of 2004.FYI 11/5/03

September Call Report Forms Online

The FDIC has placed the September 30, 2003 Call Report forms online.September Call Report 11/4/03

Senior Officer Lending Practices Survey

The FRB has released the October 2003 Senior Loan Officer Opinion Survey on Bank Lending Practices which addresses changes in the supply of, and demand for, bank loans to businesses and households over the past three months. In addition, the survey contains a supplementary question on potential demand for C&I loans, a series of questions on banks' participation in the secondary market for C&I loans, and a question on loans secured by real estate but used for purposes other than the acquisition or improvement of real estateSurvey 11/4/03

OTS Outsources Cash Collection

OTS has given notice to customers making payment by check that its cash collection function has been outsourced to the Bureau of Public Debt'
s Administrative Resource Center. Each check will be converted into electronic fund transfer.OTS Notice 11/4/03

Treasury Market Financing Estimates

Treasury has announced its estimate of net borrowing of marketable debt for the Fourth Quarter of 2003. Market Estimates 11/4/03

International Finance Discussion Paper Released

The FRB has released a new International Finance Discussion Paper entitled,

The High-Frequency Response of Exchange Rates and Interest Rates to Macroeconomic Announcements.Discussion Paper 11/4/03

October G.5 Issued

The FRB has issued the October 31, 2003 edition of the G.5 Foreign Exchange Rates statistical release.October G. 5 11/4/03

$1.4 Billion Settlement Approved

The SEC has announced Court approval of the $1.4 billion global settlement of enforcement actions against ten of the nation's top investment firms and two associated individuals. The enforcement actions alleged undue influence of investment banking interests on securities research at brokerage firms. In addition to the monetary payments, the firms are required to undertake dramatic reforms to their future practices, including separating their research and investment banking departments. Settlement Information 11/3/03

OFAC Change Added SDGT

As noted in Friday's BOL OFAC Alert, OFAC has added a new SDGT to the OFAC List. Information regarding the entry and AKAs has been added to the BOL OFAC page. 11/3/03

FRB Check Restructuring Changes

The Federal Reserve is making changes to its check processing and adjustments operations in response to the changing market, including the decline of check volumes industry wide.Check Processing Changes    Check Adjustment Changes    FAQ    Communications 11/3/03

FRB Cash Services Forms Online

FRB Financial Services has place its standard cash service forms and instructions on its Web page. Cash Services Forms 11/3/03

2004 FRB Fee Schedule Announced

New pricing information for 2004 has been announced by FRB Financial Services.2004 Fees 11/3/03