Consumer Financial Services Alert - August 12, 2008

The OCC published an interpretive letter opining that, based on the facts presented by the party requesting the opinion, an operating subsidiary of a national bank should export the interest rate and fees considered interest that the most-favored lender may charge in its parent bank’s home state, even though the operating subsidiary has no offices located in that home state. Click here for the letter.

The FFIEC issued examination procedures to be used when determining compliance with regulations issued by the Department of Defense regarding limitations on consumer credit extended to service members and their dependents. The regulations cover payday loans, motor vehicle title loans, and tax refund anticipation loans, and apply to all persons engaged in the business of extending such credit and their assignees. Click here for the procedures.

The FFIEC issued updated examination procedures for Regulation DD. The update provides guidance on delivering disclosures electronically, and procedures to ensure paper disclosures are provided at branches before accounts are opened in response to a GAO study that suggested problems in this area. Click here for the procedures.