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UPDATE: Complaints and UDAAP – The Risk is RealWith Andy Zavoina
- 1 Video
Like compliance, UDAAP is a corporate-wide event. That is, most areas in the bank, certainly all the customer contact areas have UDAAP risk.
As you prepare a training calendar or risk-assessment, consider the customer service representative or teller selling an overdraft feature of an account or an add-on insurance feature. If scripts are used, everything can be right, or everything can be wrong. When that sales talk goes wrong promises may be made which cannot be fulfilled or features are not understood and that is a UDAAP situation even if that consumer wasn’t actually harmed. The same holds true in the loan area and add-on products, especially when sold by vendors. Vendors are not bank employees and this can sometimes cause a disconnect that leads to UDAAP problems in both Loans and Operations as products may be sold that a consumer is not eligible for, that was not specifically requested, or are sold as a trial period when in fact fees are actually charged. And in the beginning, there was product development and advertising. Where was compliance? When will UDAAP be integrated into the entire product or services lifecycle? Training staff to understand what UDAAP is will go a long way to mitigating these risks.
UDAAP risk exists today in your bank. Staff bank wide needs training on UDAAP because an ounce of prevention is worth avoiding a monetary penalty. Read the enforcement actions, the risks are real.
Mr. Zavoina has been in finance and banking for 37 years. Over 20 years were with a two-bank holding company which had $534 million in assets, 89 branches spanning Texas and nearly 500 ATMs. He managed loan workouts, has been a consumer, commercial and real estate lender, managing those departments, as well as being his banks first Webmaster. He was responsible for compliance -management, -auditing, and -training for both banks.
Andy is a frequent webinar presenter for BOL Learning Connect and a key contributor to conferences put on by BOL Conferences, Inc. In addition, Andy teaches live presentations at state association schools and regional compliance organizations across the U.S. and has served on the faculty of national banking schools. He has written articles and lectured on many facets of compliance, the use of the internet and technology as a tool, as well as compliance in cyberspace.
As a BankersOnline Guru, Andy assists banks in every day, and not so every day, compliance questions on BankersOnline, BankCompliance.com and other organizations.
Mr. Zavoina is a recipient of the American Bankers Association’s Distinguished Service Award for his involvement and accomplishments in the field of regulatory compliance management. He is a past Chairman of the ABA’s Compliance Executive Committee, the Editorial Advisory Board for the ABA Compliance Magazine and served as a member of the ABA’s Compliance School Board. He also served on the Texas Bankers Association's Compliance Committee.
He is a graduate of the ABA National Commercial Lending School, National Compliance and National Graduate Compliance School and is a Certified Regulatory Compliance Manager with the Institute of Certified Bankers.
You can reach Andy on the Internet by using his e-mail address, firstname.lastname@example.org, or visiting http://www.bankersonline.com.