Posted August, 29 2016Regulators Issue Response Letter Re: Cybersecurity Risk
On Aug. 17, 2016, The Board of Governors of the Federal Reserve System (Federal Reserve Board), the Office of the Comptroller of the Currency (OCC), and the Federal Deposit Insurance Corporation (FDIC) issued their response to an inquiry letter sent to them in May of this year by Rep. Carolyn B. Maloney (D-NY) – Ranking Member of the House Financial Services Subcommittee on Capital Markets and GSEs. In their letter to Rep. Maloney, the agencies emphasized their increased focus on the risks the U.S. financial industry faces regarding cybersecurity and outlined steps they have been taking in response to the recent multimillion-dollar cyber-hack involving the SWIFT network.
Maloney released a statement upon receipt of the regulators’ correspondence saying that she is "encouraged by the initial steps they have taken in response to the recent cyberattacks." She did go on to state, "However, as recent hacks demonstrate, our cybersecurity is only as strong as our weakest link. I remain concerned about the potential for future attacks and will be asking for regular updates from our banking regulators on the steps being taken to address the risks."
CFPB Releases Report Re: Elder Financial Exploitation
On Aug. 23, 2016, The Consumer Financial Protection Bureau’s Office for Older Americans released a report (including recommendations) regarding how community networks can help fight financial exploitation of elders. The CFPB also released an accompanying resource guide for the creation and enhancement of community networks. Click here to view the full report and guide.
OCC Top Official Warns Banks Must Exercise Vigilance with Third Parties
On Aug. 29, 2016, Grovetta Gardineer, Senior Deputy Comptroller for Compliance and Community Affairs at the Office of the Comptroller of the Currency (OCC), spoke at the 2016 Association of Military Bankers of America Workshop in Leesburg, Virginia, warning banks of their accountability regarding third party business partners. In her remarks, Deputy Comptroller Gardineer pointed out OCC regulation updates aimed at accommodating innovation within the financial industry, but also emphasized that financial institutions must closely watch the third parties they deal with as they will be held accountable for any abuses. "Banks are responsible and will be held accountable for failures and abuse in the products and services they offer – even those delivered by third-party vendors," Gardineer said. "At the same time, the OCC must improve its processes for identifying and assessing innovation affecting the federal banking system."
The OCC, in coordination with the Federal Deposit Insurance Corporation (FDIC), expects to update its third-party vendor guidance for financial institutions over the next few months.
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