The Federal Reserve published a Consumer Compliance Supervision Bulletin in July, which provides high level summaries of a variety of compliance issues the agency has observed in its supervised entities. These issues are examined in a recent CUNA CompBlog post.
The two key focuses of the bulletin are fair lending risks and Unfair, or Deceptive Acts of Practices (UDAP), important areas of concern for credit unions.
Fair lending topics include:
- Redlining: Institutions should conduct a redlining review to properly mitigate risk, which includes assessing:
- Whether the CRA assessment area excludes minority census tracts
- Whether the lending record shows significant disparities
- Whether the branching strategy excludes minorities
- Whether the marketing and outreach strategy excludes minorities
- A review of complaints to determine whether the institution treats certain geographies differently on a prohibited basis.
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