This article highlights four “must-know” regulatory and compliance updates a financial institution should be aware of. February has brought more COVID-19 scams, 2021 stress test scenarios and an update on FedNow.
2021 Stress Test Scenarios Released
The Federal Reserve Board has announced the hypothetical scenarios for the 2021 bank stress tests. The stress tests help to ensure that large financial institutions can lend to businesses and consumers, even in the midst of a recession. The stress test evaluates the resilience of a large financial institution by estimating their loan losses and capital levels under hypothetical recession scenarios.
Why Is This Important to Me?
If you are considered a large bank, you will want to review these hypothetical scenarios for the 2021 stress tests.
CFPB: Beware of Online Romance Scams
The CFPB released a blog, “Break up with Online Romance Scams,” as a warning to consumers of the increased use of romance scams as the pandemic continues. Increased loneliness is one trigger that makes consumers more vulnerable to scammers. The article offers advise on how to spot a romance scammer and how to avoid such scams.
Why Is This Important to Me?
Romance scams are one of the top ways consumers are frauded out of their money, and financial institutions could use as many resources as possible to help educate their clients. Share this blog post with client-facing employees in your institution who may be looking for ways to help educate their clients on ways to protect their money from scammers.
FinCEN Advisory on Frauds Related to COVID-19
FinCEN has released an advisory titled, “COVID-19 Health Insurance– and Health Care-Related Fraud.” The advisory contains descriptions of COVID-19 related fraud involving health care benefit programs and health insurance. The advisory also contains red flag indicators, examples and information on reporting suspicious activity.
Why Is This Important to Me?
COVID-19 scams have been around since the pandemic started, and they will continue getting more complex until the pandemic is over. Share this advisory with client-facing colleagues within your institution who may be looking for ways to help educate their clients on ways to protect their money from scammers.
FedNow Service to Launch in 2023
The Federal Reserve has announced the launch date of its instant payments platform will be in 2023, advancing the expected delivery timeframe by a full year. The initial launch will include core clearing and settlement functionality and value-added features. Additionally, the Federal Reserve has created a quick overview video that follows a payment from start to finish and shows what financial institutions need to know about their role in the process.
Why Is This Important to Me?
FedNow is going to be a game-changer for financial institutions. It will allow institutions to meet the evolving needs of consumers and keep pace with Fintech competitors, such as PayPal and Venmo. Other benefits the implementation of FedNow may bring are:
- Retention of current clients and attraction of new clients
- Lowering costs through efficient automation
- Growing revenue through other product offerings, transaction fees, etc.
About the Author
Rachel Davis
Product Manager at OnCourse Learning
Rachel Davis is the Product Manager of GRC and professional education for banks, credit unions, and non-bank financial services at OnCourse Learning. Rachel has worked in the financial services industry for 12 years and keeps up to date on financial industry hot topics. Rachel received her Bachelor of Arts in English Literature from Saint Louis University.
About the Author
Rachel Davis
Product Manager at OnCourse Learning
Rachel Davis is the Product Manager of GRC and professional education for banks, credit unions, and non-bank financial services at OnCourse Learning. Rachel has worked in the financial services industry for 12 years and keeps up to date on financial industry hot topics. Rachel received her Bachelor of Arts in English Literature from Saint Louis University.
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