Links in “Fines, Penalties, Suits, and Settlements”

Former CEO Charles Robert Poore of $42 million Toledo Metro FCU has been charged with the theft of over $200,000 from the credit union. Federal agents claim that Poore used his corporate credit card in conjunction with his wife’s credit card to purchase items for the credit union through Amazon and then resold the items to the credit union at significantly inflated prices. [10/23/15]

Sprint charged customers with lower credit scores an extra monthly fee. But what got the mobile service provider in hot water with the FTC wasn't that it charged these customers more, it was that it failed to let the consumers know until it was too late for them to choose another mobile carrier. [10/23/15]

The Federal Trade Commission (FTC) has approved final consent orders against two Las Vegas auto dealers for misrepresenting the cost of cars in advertising, including the promotion of heavily discounted prices which were not generally available to consumers. [10/21/2015]

Yesterday, NCUA accepted settlements from two more banks for their roles in the sales of faulty residential mortgage-backed securities to corporate credit unions. Although not admitting fault, Barclay’s Capital agreed to pay NCUA $325 million to settle claims and Wachovia Bank agreed to a payment of $53 million. This brings the amount collected by NCUA from banks that participated in the events that led to the liquidation of several corporate credit unions to a total of $2.2 billion. [10/20/15]

Used to playing offense, FinCEN finds itself on the defense against two foreign banks that are fighting back against being designated under Section 311 of the USA PATRIOT Act as "primary money-laundering concerns." [10/19/15]

OCC hands down two civil money penalties, two formal agreements, and three removals/prohibition orders. On the plus side, three entities saw their enforcement actions terminated. [10/19/15]

A former auditor of Bank of Internet alleges that his former employer has been making loans to borrowers who may have been off-limits under federal anti-money laundering laws and that many of its accounts lack tax identification numbers. He is suing the bank for violation of whistle-blower protection laws. [10/14/15]

Here’s why a strong vendor due diligence program is so important. Southeast Financial Credit Union is now in the unfortunate position of having to sue one of its affiliates, The College Network (TCN), to recover $12 million in unpaid student loan obligations. TCN sells course modules and study materials to help students to earn college credits. SFCU, which is the primary financer of these courses and materials, currently holds about $35 million in loans guaranteed by TCN. [10/5/15]

A Los Angeles-based indirect auto lender called consumers under false pretenses, used a phony caller ID, threatened to refer borrowers for criminal prosecution, and illegally disclosed information about debts to borrowers' employers, friends, and family. Other than that, though, they ran a fairly tight operation. [10/2/15]

The Justice Department announced $186 million in settlements from the big five mortgage services for an additional 1,461 service members and their co-borrowers bringing the total settlement compensation to $311 million under the protections of the Servicemembers Civil Relief Act (SCRA). The settlements stem from servicers obtaining foreclosure without a judicial proceeding or where the servicer obtained a default foreclosure judgment without filing a proper affidavit with the court stating that the service member was in military service. [10/2/15]