As regulations continue to change, with proposed rules often getting delayed or modified, it's important for credit unions and small financial institutions to continually monitor regulations.
Relevant compliance calendars can be extremely helpful for tracking compliance dates. For example, credit unions can consult The National Association of Federally-Insured Credit Unions (NAFCU) compliance calendar to stay on top of regulations.
Similarly, banks can view the FDIC compliance calendar, which pulls in relevant regulations from government agencies such as the Consumer Financial Protection Bureau (CFPB).
The Federal Register site can also be searched for information on relevant regulations, but whatever source you use may not be a complete reference. For example, some data regulations may be industry-agnostic, so they may not show up on a bank regulator’s calendar. Thus, it’s important to conduct a thorough review of 2020 regulatory dates with your legal and compliance team.
That said, a few notable changes to keep in mind in 2020 include:
- The California Consumer Privacy Act (CCPA) comes into effect on January 1, 2020, which can affect the marketing activities of credit unions and small financial institutions that serve California consumers. Even if your organization does not do business in California, keep an eye on this law, as similar data privacy measures could come to other states or become federal law.
- In Illinois, the Artificial Intelligence Video Interview Act comes into effect on January 1, 2020, which relates to the use of AI in hiring. While the scope of the law is fairly narrow, it’s interesting to note how laws are starting to emerge around new technologies like AI. Financial institutions should be aware of evolving regulations around AI and related technologies, even if they do not do business in Illinois.
- On November 19, 2020, the CFPB’s rule for “Payday, Vehicle Title, and Certain High-Cost Installment Loans” for underwriting provisions comes into effect, where lenders have to meet certain requirements related to making and enforcing these loans. For example, lenders must “provide certain notices to the consumer before attempting to withdraw payment for a covered loan from the consumer’s account,” according to the CFPB. That may mean credit unions and financial institutions have to implement IT-related practices to track that these notices are being properly sent and managed, which exemplifies the many ways financial institutions need to think about data and IT systems going forward.
DataComm is a leading managed service provider with significant expertise helping financial services firms improve compliance. Our wide range of services includes implementing compliance-related software and processes, auditing compliance procedures, testing security practices and more.
We work with a variety of credit unions, community banks and regional banks to turn compliance challenges into opportunities to innovate. Contact an expert representative today.