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Advice From the Compliance Front Line

You’ve just been promoted to compliance officer. What do you need to know?

December 11, 2012
KEYWORDS compliance , credit , state
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Congratulations! You’ve just been promoted to compliance officer at your credit union (or your manager has just added “responsible for compliance” to your job description).

So, what’s your next step? I asked several credit union compliance professionals for their advice, and compiled their must-do suggestions into a top 10 list.

1. Familiarize yourself with online resources. Maureen Shedden, compliance officer with Empower Federal Credit Union, Syracuse, N.Y., “highly recommends new compliance officers get very familiar with online resources, such as CUNA’s website, especially the e-Guide.”

CUNA’s e-Guide to Federal Laws and Regulations covers more than 100 topics. Each topic includes links to the laws and regulations, and many also provide summaries and frequently asked questions (FAQs). CUNA has many resources to answer a wide range of compliance questions.   

Use your state league resources, “including InfoSight and its compliance staff,” Shedden suggests. The InfoSight online compliance tool is a collaborative effort among most leagues and provides state and federal compliance information (and links to CUNA’s e-Guide).

State laws and regulations are often overlooked. Remember to check with your state league to ensure you haven’t missed a state compliance issue.

Consult the regulatory agencies’ websites, such as those for NCUA (ncua.gov), the Financial Crimes Enforcement Network—FinCEN (fincen.gov), and the Consumer Financial Protection Bureau—CFPB (consumerfinance.gov), recommends Danita Hiley, senior field consultant, West Virginia Credit Union League.

And although the Real Estate Settlement Procedures Act (RESPA) regulations have been transferred to the CFPB, the Housing and Urban Development’s RESPA website still contains useful resources. Request an RSS (really simple syndication) feed, which allows you to receive automatic updates.

2. Seek as much training as possible. New compliance staff should “soak up every training material you can get your hands on,” suggests Matt Bailey, compliance specialist, Linn Area Credit Union, Cedar Rapids, Iowa. Sign up for all available online training webinars and attend as many compliance schools as your credit union will allow.

Become certified as a “credit union compliance expert” (CUCE) through CUNA’s RegTrac certification program and look for local compliance seminars your state league, outside counsel, and vendors sponsor. Bailey has been a compliance professional for less than a year, and one of the first things he did was join the ranks of more than 1,700 CUCEs across the country.   

3. Subscribe to daily blogs and email lists. CUNA’s daily compliance blog, CompBlog, provides a quick way to keep you up-to-date on regulatory changes as they occur (and it has an RSS feed). Many leagues, law firms, vendors, and even the CFPB have blogs. Although the topics will be similar, you may find different perspectives, and possibly state specific information.     

Online email lists can be helpful as well. CUNA’s compliance email list—Compliance Brainstorming on the Web (COBWEB)—allows you to send your question out to many other compliance professionals and solicit advice from your peers.

Jennifer Nelson, branch manager, AP Federal Credit Union, Toledo, Ohio, encourages compliance staff to monitor COBWEB regularly, because “if other compliance folks are talking about it, it either is or will be affecting you (or you are missing something).” 

4. Create a credit union network. “Develop a network of other compliance people you can call if you get stuck or if you need to check your reasoning by talking through the issue.”

That advice comes from Carole McCallister, manager, shared compliance services, Ohio Credit Union League.

“Never be afraid to call someone else in your network. They probably have had similar experiences, or they will in the future,” she adds. “And reach out to similarly-sized credit unions and those that use your same data processing system,” suggests Donya Parrish, vice president, dues-supported services, Montana Credit Union Network. Many local and regional compliance roundtables exist, so ask around.

Another good place to network is at CUNA’s compliance schools. In addition to the many compliance webinars, audio conferences, and e-Schools offered every month, CUNA offers at least four compliance schools annually (Bank Secrecy Act, Lending, Marketing, and Regulatory Compliance Levels 1 and 2). These schools provide opportunities for compliance professionals to share ideas and concerns. 

5. “Let me check on that and get back to you.” Nelson recommends new compliance officers memorize this phrase because “as soon as you think you know a regulation backward and forward, it changes.”

It’s important new compliance officers realize that not knowing the answer to a compliance question off the top of their heads isn’t a shortcoming. When facing a compliance issue, accuracy always outweighs expediency. 

 “It’s much more important to know where and how to find the answer than to know the answer outright,” says Compliance Team Leader Laura Titak, of Atlanta’s Delta Community Credit Union. “Regs change. And they’re full of exceptions.” 

6. Don’t take name calling too seriously. “Many times you’ll be considered the ‘no-can-do guy/gal,’ just because you’re the bearer of bad news,” cautions Jim McKinney, compliance consultant, NW Compliance Group.

“When presenting new or changed requirements, try to identify and share viable solutions.” Instead of the “no-can-do” person, you can become the “go-to” resource, part of the team that creates compliant solutions. This also will remind colleagues that you don’t make the rules. You’re just there to interpret them. 

7. Gain support from the top. If top management doesn’t support and appreciate the importance of the compliance officer, your compliance program won’t succeed, warns Jill Stowe, compliance manager, Vermont State Employees Credit Union, Montpelier, Vt.

It’s important to periodically remind management that noncompliance can produce losses—or, in rare instances, a financial institution’s failure. Like other credit union departments, compliance needs adequate resources and staff to do the job effectively.  

8. Be involved in decisions. You can only be effective if you’re involved in the decisions and changes at the credit union. When possible, insert yourself into department meetings and send staff communication on topics that relate to specific departments.

Get involved in the development, improvement, and promotion of products and services as early as possible. This will help you avoid situations where marketing department staff, for example, knock on your door at 5 p.m. with copy they need reviewed by morning.

“Don’t just tell them what’s wrong/right/changing, but work with them. They know a lot and are likely to be your best ally and resource,” recommends Parrish. At the same time, be clear on issues of fraud, ethics, and noncompliance.  

9. Keep good records. Whenever you research a compliance issue, document what you find and where you found it. When you provide information to credit union staff and management on a compliance issue, do it in writing and keep it on file. Not only will this help you find the information quickly if the issue comes up again, but you’ll have a record of your recommendation should a question of noncompliance arise.

Jon Hendrix, compliance analyst, Georgia’s Own Credit Union, Atlanta, received this advice when he started: “Don’t feel the need to fight every little battle, or get your feelings hurt if your advice isn’t heeded. The compliance officer’s duty is to give accurate information. It’s the duty of the decision makers to make wise decisions based on that information. But be sure to keep a record of all advice you give.”

10. “Maintain a sense of humor, and get a dog.”  Many who responded to my request for advice suggested maintaining a sense of humor. Referring to the CFPB’s recent mortgage regulation, McKinney shared these thoughts: “Reading 1,100 pages of a new regulation and imagining the response from the departments when you share information can be stressful, monotonous, tedious, repetitious, droning, and dreary.

You need to find a release: Humor and dogs work for me—along with an occasional Jose Cuervo.”

Whether it’s Mexican tequila, green tea, or yoga, finding a way to decompress after a long day of regulatory compliance is essential. And welcome to the compliance family!

COLLEEN KELLY is CUNA’s federal compliance counsel.

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