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Compliance

 

The Consumer Financial Protection Bureau CFPB

CFPB released an analysis of student loan industry data 

This month the CFPB released an analysis of one student loan industry data sample which shows that 9 in 10 of the highest-risk borrowers are not enrolled in federal affordable repayment plans. This data is significant because student loan providers are obligated to inform borrowers about any affordable repayment options that they may qualify for.

From the point of view of the CFPB, this data offers new evidence that borrowers, taxpayers, and student loan companies would benefit from a clearer, more streamlined process to help previously defaulted borrowers succeed over the long term, and to ensure borrowers avoid default in the first place. Last year, the Bureau warned that hundreds of thousands of struggling student loan borrowers may end up back in default over the next two years, racking up at least $125 million in unnecessary interest charges along the way.

 

Compliance

 

FDIC

FDIC released their new bank development handbook

On May 1st 2017, The Federal Deposit Insurance Corporation (FDIC) released their long awaited plain-language handbook to assist with the development of new banks.  The handbook provides an overview of the requirements of the application process, and is intended to provide interested parties with a clear explanation on the process of obtaining deposit insurance and the three phases of establishing an FDIC insured institution; pre-filing, the application process, and pre-opening.

Compliance 

SEC

SEC filed fraud charges on Fitbit stock

SEC recently filed fraud charges against a mechanical engineer who is accused of plotting to manipulate the price of Fitbit stock, by filing a phony regulatory report. The SEC claims that Robert W Murray purchased Fitbit call options minutes before a fake tender offer that he arranged was filed on the SEC’s EDGAR system suggesting that a company named ABM Capital LTD sought to acquire Fitbit’s outstanding shares at a substantial premium.  Fitbit’s stock price temporarily spiked when the tender offer became publicly available, and Murray sold all of his options for a profit of approximately $3,100. 

 

Others

Other Regulatory Bodies

Federal Reserve Bank fines former Global Head of Foreign Exchange (FX)

 

The Federal Reserve Board announced that it has imposed a $1.2 million fine against Christopher Ashton, the former Global Head of Foreign Exchange (FX) Spot Trading at Barclays Bank PLC, for his role in the manipulation of FX pricing benchmarks. Ashton also received a lifetime ban from any future employment in the banking industry.

 

Ashton failed to appear at a hearing in administrative law proceedings after the Board charged him in June 2016 with unsafe and unsound practices related to his use of electronic chat rooms to coordinate FX trading, facilitate manipulation of FX pricing benchmarks, and disclose confidential customer information to traders at other organizations, as well as his failure to appropriately supervise other Barclays traders.

The enforcement proceedings against Ashton came after the Board previously filed enforcement actions against Barclays in May 2015 for unsafe and unsound practices related to its compliance and control failures concerning its practices in the FX markets resulting in Barclays paying $342 million in penalties.