Alert February 23, 2010

OCC Issues Guidance on Refund Anticipation Loans

The OCC issued a policy statement and a consumer advisory on tax refund-related products, including refund anticipation loans. The policy statement addresses risk management practices and consumer protections for tax refund-related products and covers the following topics:  board and management responsibility, consumer protection standards, third-party risk management, fraud and anti-money laundering compliance, training, management information systems, loss recognition, and capital and liquidity. Among other things, the policy statement includes disclosure and contract terms requirements. In its press release, the OCC states that it expects national banks to implement the policy statement’s requirements in 2010, to the extent practicable, and for the enhanced consumer disclosures that may necessitate revisions to forms currently in use, implementation is expected for products offered in 2011. Click here for a copy of the press release, here for the policy statement and here for the consumer advisory.