Weekly Rewind...News from Your Regulators

Small Entity Compliance Guide Issued by CFPB


The CFPB has issued a Small Entity Compliance Guide for the small business lending rule, which implements Section 1071 of the Dodd-Frank Act. The guide includes sample forms and resources for filers.


Federal Reserve Issues Supervision and Regulation Report


The Federal Reserve issued its semiannual Supervision and Regulation Report. The Report is intended to inform the public and provide transparency about its supervisory and regulatory policies and actions. The Report states: “the U.S. banking system is sound and resilient, with strong capital and liquidity. At the same time, recent stress in the banking system shows the need for us to be vigilant as we assess and respond to risks. The recent failures of three large U.S. banks have also demonstrated the risks of concentrated funding sources and poor management of interest rate risks. As interest rates have risen, fair values of investment securities have declined significantly. Deposit costs have also increased from low levels, and firms are turning to wholesale borrowings to address emerging funding needs. Delinquency rates for some loan segments have started to increase from the low levels seen over the past several years. Banks have increased provisions for credit losses in anticipation of asset quality deterioration. Accordingly, supervisors are redoubling their efforts to assess banks’ preparedness for emerging credit, liquidity, and interest rate risks.

 

ICE Issues Special Alert


In April, the U.S. Immigration and Customs Enforcement (ICE) issued a special alert regarding Pig Butchering. “ Shāz Hū Pán otherwise known as pig butchering is an increasingly prolific financial fraud scheme, which combines elements of traditional romance and investment fraud whilst also targeting people trafficking and modern slavery victims. The typology generally (although not exclusively) is controlled by organized criminal gangs operating from Southeast Asia, including Special Economic Zones (SEZ) in countries like Myanmar, Laos, Cambodia and Thailand. In 2022, U.S. based victims alone lost approximately $3.3 billion dollars to cryptorelated investment frauds.

Pig Butchering works by criminal networks placing fake job advertisements to attract young people from China and other countries. These individuals are then held, against their will, in secure compounds where they are forced (under threat of violence) to commit cyber enabled fraud against victims largely located in Western countries including the U.S. and Europe.

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