Both the Equal Credit Opportunity Act (ECOA) and the Fair Credit Reporting Act (FCRA) contain requirements for providing notice of action taken. This webinar reviews the requirements of both laws and covers common violations and provides solutions.
Examiners closely scrutinize denial notices for compliance with ECOA and FCRA requirements. Adverse action violations are frequently cited in exam reports. Items as simple as the failure to check a box or checking a box that should remain unchecked are frequent violations.
Corrective action can be painful. Pursuant to a consent order with its regulator, one bank was required to search its records for two previous years to identify loan applicants that never received, or who had received inadequate, adverse action notices. The bank was required to send new notices to affected applicants within seventy-five days from the date of the order. This action was burdensome for the creditor, confusing for the denied applicants, and completely avoidable.
Failure to comply with adverse action requirements can lead to civil liability and enforcement actions from the regulators. This webinar covers the proper and timely handling of denial notices in accordance with ECOA/Regulation B and FCRA. Participants receive a detailed manual that serves as a handbook long after the program is completed.
Upon completion of this two-hour program participants understand:
The adverse action notice requirements of both the Equal Credit Opportunity Act (Regulation B) and the Fair Credit Reporting Act;
How to complete the model adverse action form;
The rules for providing notices to multiple borrowers;
The rules for determining who provides the notice in situations with multiple creditors or a broker and an investor;
Proper handling of counteroffers, and withdrawn and incomplete applications;
Timing rules for adverse action notices;
How to select the correct reasons for denial;
Rules for commercial loans;
The differences between applications, completed applications and inquiries, prequalifications and preapprovals;
When an adverse action notice is needed for a deposit account;
Listing credit scores for adverse action versus the HMDA LAR;
Who is listed as the credit bureau where the credit report is obtained from an aggregator who includes three credit scores from three different companies; and
Common errors in completing adverse action notices.
The program is designed for compliance officers, auditors and for those with responsibility for completing adverse action notices.
Jack Holzknecht is the CEO of Compliance Resource, LLC. He has been delivering the word on lending compliance for 39 years. In Jack's 34 years as a trainer over 125,000 bankers (and many examiners) have participated in his live seminars and webinars. Jack's career began in 1976 as a federal bank examiner. He later headed the product and education divisions of a regional consulting company. There he developed loan and deposit form systems and software. He also developed and presented training programs to bankers in 43 states. Jack has been an instructor at compliance schools presented by several state bankers associations. He developed and delivered compliance training for the FDIC and OTS for ten years. He is a Certified Regulatory Compliance Manager and a member of the National Speakers Association. He is also a "BOL Guru."