Financial Institutions and Banking Helpful Articles

CFPB Issues Guidance on Unauthorized EFTs

The Consumer Financial Protection Bureau (CFPB) has issued guidance — in the form of answers to FAQs — on unauthorized electronic fund transfers (EFTs). Here are some of the highlights:

  • Unauthorized EFTs include situations in which a third party fraudulently induces a consumer into sharing account access information that’s used to initiate an EFT from the consumer’s account. And subsequent EFTs initiated using that information are not excluded from the definition of unauthorized EFTs as transfers initiated by “a person who was furnished the access device to the consumer’s account by the consumer.”
  • Banks can’t consider a consumer’s negligence when determining liability for unauthorized EFTs under Regulation E.
  • In determining whether an EFT was unauthorized and whether any liability protections apply, a bank can’t rely on a consumer agreement that “includes a provision that modifies or waives certain protections granted by Regulation E, such as waiving Regulation E liability protections if a consumer has shared account information with a third party.”

You can find the complete FAQs by visiting and typing “EFT FAQs” in the search box.

Federal Reserve tool simplifies CECL implementation

For most community banks, the current expected credit loss (CECL) accounting standard will take effect in 2023, and many banks are concerned about the complexity involved in complying with the updated standard. In an effort to simplify the process, the Federal Reserve in July unveiled its Scaled CECL Allowance for Losses Estimator (SCALE), a spreadsheet-based tool that “draws on publicly available regulatory and industry data to aid community banks with assets of less than $1 billion in calculating their CECL allowances.”

Your advisors can help you determine whether the SCALE is appropriate for your institution. For more information, visit

OCC will rescind 2020 CRA rule

In July, the OCC announced its intent to rescind its May 2020 final rule, which was designed to modernize and strengthen the regulatory framework for implementing the Community Reinvestment Act (CRA). Notably, neither the Federal Reserve nor the FDIC joined the OCC in advancing the final rule. In a statement, acting comptroller Michael Hsu said: “To ensure fairness in the face of persistent and rising inequality and changes in banking, the CRA must be strengthened and modernized.” He went on to observe that “the disproportionate impacts of the pandemic on low- and moderate-income communities, the comments provided on the [Fed’s] Advanced Notice of Proposed Rulemaking, and our experience with implementation of the 2020 rule have highlighted the criticality of strengthening the CRA jointly with the [Fed] and FDIC.”


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