What We Know

OCC Continues to Emphasize Compliance with Servicemembers Civil Relief Act

September 18, 2015 | by Caren D. Enloe

In prepared remarks to the Association of Military Banks, the OCC re-emphasized its focus on bank compliance with the Servicemembers Civil Relief Act (the “SCRA”) and its ramp up to enforce the Military Lending Act regulations that were recently passed. Deputy Comptroller Grovetta Gardineer noted that the “OCC has seen deficiencies in the practices and procedures at some banks related to their SCRA-compliance programs.” The OCC’s remarks set forth the following expectations:

  • Banks improve their SCRA-compliance policies and procedures for determining whether servicemembers are eligible for requested SCRA-related benefits in all accounts the borrower may have, not just the account that is subject of the request;
  • Banks calculate SCRA benefits correctly
  • Banks have policies and procedures in place for verifying the status of a servicemember’s eligibility for SCRA protections before seeking default judgments on extensions of credit or initiating foreclosure repossession processes

Inadequate compliance with the SCRA has been a component of several recent enforcement actions, including those against JP Morgan Chase and Bank of America.  The OCC remarks also serve as a reminder that banks should be ramping up for the new Military Lending Act rules that will begin to take effect in October 2015.

Caren Enloe is a partner who concentrates her practice in consumer financial services litigation and compliance, bankruptcy, and commercial litigation with an emphasis on creditor’s rights. She has a deep understanding of the complex compliance environment surrounding the financial services industry and regularly advises financial service companies on licensing and compliance issues involving state and federal consumer protection and finance statutes. Caren is the author of a daily blog titled: Consumer Financial Services Litigation and Compliance where she posts timely and informative updates regarding the CFPB, FTC, and a host of topical litigation issues involving consumer protection law....LEARN MORE

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