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2019 Compliance Training Plan – What to Consider

Nov 04, 2018

As we near the end of 2018, it is time once again to build training calendars for the upcoming year, and decisions must be made on what topics to include. Two questions we are frequently asked by compliance officers as they begin making decisions on which courses to cover are, “What regulations have required training, and how often must staff be trained?” 


To help financial institutions get started, below is a list of the regulations with training requirements: 


  • The Bank Protection Act stipulates that management should provide initial and periodic training to employees on their responsibilities under the security program and on proper employee conduct during and after a robbery.


  • One of the pillars of the Bank Secrecy Act is training of appropriate personnel. The FFIEC’s Bank Secrecy Act/Anti-Money Laundering Examination Manual details the training expectations for personnel, including the Board of Directors. The details can be found here:


In addition, within the Customer Identification Program (CIP) examination procedures, examiners are instructed to evaluate audit and training programs to ensure these requirements are adequately incorporated.


  • The Expedited Funds Availability Act, Regulation CC, requires financial institutions to establish procedures to ensure compliance with the requirements of Subpart B- Availability of Funds and Disclosure of Funds Availability Policies and to provide each employee who performs duties subject to the requirements of Subpart B with a statement of the procedures applicable to that employee.


  • According to the Interagency Guidelines Establishing Information Security Standards, part III – Development and Implementation of Information Security Program, financial institutions must train staff to implement the information security program.


  • As part of the Fair Credit Reporting Act (FCRA), Regulation V, under the Administration section of Duties Regarding the Detection, Prevention, and Mitigation of Identity Theft is the requirement to train staff, as necessary, to effectively implement the program.


  • The FCRA’s Appendix E to Part 1022, Interagency Guidelines Concerning the Accuracy and Integrity of Information Furnished to Consumer Reporting Agencies, requires financial institutions to train staff who participate in activities related to the furnishing of information about consumers to consumer reporting agencies to implement the institutions’ policies and procedures for complying with Part 1022.


  • The SAFE Act requires that all employees who are Mortgage Loan Originators (MLOs) be informed of the registration requirements of the act and instructed on how to comply.


  • Regulation Z, part 1026.36, mandates financial institutions provide periodic training covering federal and state law requirements that apply to the individual loan originator's loan origination activities.

    In addition, training is mentioned or implied in regulatory guidance and examination procedures covering the following:


  • The Joint Guidance on Overdraft Protection Programs lays out the expectation that consumer service or consumer complaint processing staff will be trained so that they can explain the overdraft protection program’s features, costs, and terms, including how to opt out of the service. Staff also should be able to explain other available overdraft products offered and how consumers may qualify for them.


  • Though the Fair Lending laws and regulations do not specifically state that training is required, there is an expectation that it be provided. The Interagency Fair Lending Examination Procedures contain multiple references to training and how it relates to Fair Lending compliance. For example:


    • Under Evaluating the Potential for Discriminatory Conduct, examiners are to evaluate compliance program materials (particularly fair lending policies), training manuals, organization charts, as well as recordkeeping, monitoring protocols, and internal controls.


    • Under Identify Compliance Program Discrimination Risk Factors, examiners determine whether fair lending training is nonexistent or weak.


    • Within Compliance Management Review, the examination team is to obtain a thorough understanding of how management addresses its fair lending responsibilities with respect to (a) the institution’s lending practices and standards, (b) training and other application-processing aids, (c) guidance to employees or agents in dealing with consumers, and (d) its marketing or other promotion of products and services.


  • Privacy of Consumer Financial Information, Regulation P, also does not contain a specific requirement for training, but the Interagency Examination Procedures instruct examiners to determine the adequacy and regularity of an institution’s training program. For violation(s) noted, examiners are to determine the cause by identifying weaknesses in internal controls, compliance review, training, management oversight, or other areas.


Although annually is not always specified as the timing interval for these trainings, this is typically what we see as an industry practice. We believe training should be as frequent and as detailed as is needed to keep employees fully informed of their responsibilities so they can provide the best consumer service possible while protecting the assets of the financial institution.


Whenever a financial institution recognizes a weakness in complying with a regulation’s requirements, training is generally one component of corrective action. Therefore, before deciding on what to include in the 2019 training calendar, we recommend reading through examination reports, internal and external audit reports, and reviewing monitoring logs to identify areas of concern where knowledge should be enhanced. 


Also, check out the Bureau of Consumer Financial Protection’s Rulemaking Agenda to find out what’s on the horizon and ask marketing if any new products or services will be introduced.  Armed with all this information, you will be prepared to develop an effective compliance training plan for staff.