Introduction
The banking industry is continuously under the watchful eye of
the government and the Federal Reserve. The government is in
charge of setting restrictions on the banking industry's borrowing
limits and the amount of deposits that banks hold in their vaults.
These restrictions have a tremendous impact on banking
profitability. It is a federal law that banks must stay complaint to
banking restrictions.

What is Compliance?
Compliance is the act of adhering to a standard or a regulation.
Compliance training is mandatory for all banking employees.
This training tutorial will provide every employee with a basic
knowledge about the compliance rules and regulations that
pertain to their departments.

Compliance Training Objective
This training is intended to provide participants
with a step-by-step guide for regulatory
management while following existing federal,
state and local regulatory laws corresponding to
the Banking branch departments.

In this training course you will learn:
What is regulatory compliance and it how it effects
Devon Bank.
Knowledge of Devon Bank departmental
responsibilities
Penalties for noncompliance and institutional risks.
How to Devon Bank employees avoid government
penalties and fines.
Why compliance is important.

Federal Regulations
It is Devon Bank’s responsibility to comply
with all federal rules and regulations in
every aspect of its business.
All employees are expected to comply with
Federal rules and regulations.

FDIC Compliance Guidelines
Compliance examinations are the primary
means the FDIC uses to determine
whether a financial institutions is meeting
its responsibility to comply with the
requirements and proscriptions of federal
consumer protection laws and regulations.

FDIC Continued
The FDIC conducts three annual reviews
to determine whether of not an institution
is compliant to Federal regulations. The
three supervisory activities are compliance
examinations, visitations and
investigations.

Who Regulates Devon Bank?
Office of Comptroller of the Currency
(OCC)
Federal Reserve Member Banks (FRB)
Federal Deposit Insurance Corporation
(FDIC)
Housing and Urban Development (HUD)

Compliance Examinations
Compliance examinations are primarily
done to assess the quality of an FDIC-
supervised institution's compliance
management system
To implement federal consumer protection
statutes and regulations
To review compliance with relevant laws
and regulations
To initiate effective supervisory action
when elements of an institution's
compliance management system are
deficient or a significant violation of the

Compliance Visitations
Compliance visitations are conducted by
the FDIC to review the compliance posture
of newly chartered institutions coming
under FDIC- supervision, or in the interval
between compliance examinations to
review an institution's progress on
corrective actions.

Compliance Investigations
Compliance investigations are conducted
primarily to follow-up on particular
consumer inquiries or complaints,
including fair lending complaints.

Institution Awareness
All employees of Devon Bank should
follow the rules and regulations when
performing job duties.
Devon Bank is responsible for promoting
awareness for violation of laws and
regulations.

Regulatory Compliance
Regulatory compliance is the goal that
financial institutions aspire to reach in the
efforts to ensure all personnel are
complaint with relevant laws and
regulations.
At Devon Bank, all employees are
required to conduct business in a legal
and ethical manner.

Things to Remember
Do not discriminate against a client or employee because of
race, gender, religion, national origin, color, age, disability,
sexual orientation or preference or veteran status
Commit to the highest standard of business and ethical
conduct in all activities while representing Devon Bank
Respect the rights of others
Avoid conflicts of interest and self dealing
Be award of laws, rules, regulations and policies that apply to
your job
Promote accuracy and truth in Devon Bank business
transactions
Maintain absolute confidentiality regarding client’s records
Report any perceived wrongdoing to your supervisor of the
Devon Bank Compliance Department
Do not destroy any records except in accordance to Devon
Bank policy

Now that you are aware of FDIC compliance
guidelines that govern Devon Bank, we will
next review responsibilites for the Branch
Operations department.

Devon Bank Branch Operations
The Branch Operations goal is to service
and provide products to all retail customers.
Branch Operation oversee:
Tellers
Customer Service Representatives
Personal Bankers
Bookkeeping/ Accounting

Branch Operation Responsibilities
Operations of individual branches need to
be examined, analyzed and evaluated in
order to ensure job duties are being
performed.
Branch operations other responsibilities
are managing branches, ensuring
adherence to Devon Bank standards and
ensuring policies are being upheld.

Now that you are aware of FDIC compliance
guidelines that govern Devon Bank, we will
next review responsibilites for the Lending
Department.

Devon Bank Lending
Department
Lending has many function within Devon
Bank. It is an important branch which
allows Devon Bank to serve its customers
by providing expertise in their knowledge
of lending.
It is vital for every lending assoicate to be
knowledgable in lending federal rules and
regulations

Next we will review Federal Rules and
Regulations for the Devon Bank
Commerical Lending Department

Devon Banks Commerical Lending
Department Regulations
American Disabilities Act
The main aim of this disabilities act is to
stop any kind of discrimination in
employment, transportation, public
programs and services, telecommunications
services and public accommodation.

Bank Secrecy Act
This act requires financial institutions in the United
States to assist United States government
agencies to detect and prevent money
laundering.
Financial institutions are required to keep records
of cash purchases of negotiable instruments and
file reports of cash purchases of these
negotiable instruments of ten thousand dollars
or more.

Patriot Act
The function of the Patriot Act is to deter
and punish terrorist acts in the United
States and around the world. The Patriot
Act prevents, deters and helps prosecute
international money laundering and
financing of terrorism.

Anti-Money Laundering
Designed to encourage commercial banks
and savings associations to meet the
needs of borrowers in all segments of their
communities, including low-and moderate-
income neighborhoods.

Community Reinvestment Act
Designed to encourage commercial banks
and savings associations to meet the
needs of borrowers in all segments of their
communities, including low-and moderate-
income neighborhoods.

Diversity
Bank employees must understand the challenges
that come with diversity such as the aspect of
cultures having different standars for
communication and different beliefs.
By eliminating sterotypes and embracing diversity,
individuals will be able to work through those
difference in their workforce and maximixe the
productivity of the organization.

Elderly Abuse
Legislation is being passed across the
county due to many senior citizen being
the victims of financial exploitaion. Should
a bank fail to report suspicions of elder
financial abuse, they will be held liable.

Regulation B:Equal Credit
Opportunity Act (ECOA)
Prohibits creditor practices that discriminate on the
basis of race, color, religion, national origin, sex,
marital status or age (provided the applicant has
the capacity to contract) to the fact that all or part
of the applicant's income derives from a public
assistance program.
ECOA also applies to the fact that the applicant
has in good faith ecercised any right under the
Consumer Credit Protection Act.

Bank Bribery Act
Amends the federal bank bribery law.
Prohibits any employees, officers,
directors, agents and attorneys of financial
institutions form accepting anything of
value for or in connection with any
transaction/exchange.

Regulation V: Fair Credit Reporting Act
Promotes accuracy, fairness and privacy of
personal information assembled by Credit
Reporting Agencies.

Fair Lending Law
Ensures equal objective and non-baised
treatment of existing and prospective
customers in all credit-related transactions
are made.

National Flood Insurance
Reform Act
Instructs banks not to increase, extend or
renew any designated loan unless the
building, mobile home or any personal
property.
Securing the loan is covered by flood
insurance for the term of the loan for the
paricular type of property under the act.

Regulation O: Insider Loans
Prohibits abuse of a bank by its own
insiders.
Regulation O covers insiders of the
institutions correspondents
Requires special reporting and approval
procedures for loans and insiders.
Limits lending amounts to insiders.
Reports loans at correspondents.

Gramm-Leach-Bliley Act
Requires financial institutions that offer
customers financial services or products
like financial or investment advice.
Loans or insurance to explain their
information sharing practices to their
customers as well as to safeguard
sensitive data.

Regulation C:Home Mortgage
Disclosure Act (HMDA)
This is intended to provide the public with
loan data that can be used to help
determine whether financial instituions are
serving the housing needs of their
communities.
This requires certain lenders to collect data
from the various types of home buying/
improvement loan application.

Information Security
Bank employees must understand the
importance of protecting customer and
employee information.
Complying with the laws and regulations
that required due diligence, following
proper security policies and procedures,
as well as reporting potential problems.

Regulation O: Insider Loans
Prohibits abuse of a bank by its own
insiders.
Regulation O covers insiders of the
institutions correspondents
Requires special reporting and approval
procedures for loans and insiders.
Limits lending amounts to insiders.
Reports loans at correspondents.

Federal Reserve Act 23A-Relations
with Affiliates
Regulates transactions between a bank and
it affiliates. The following transactions are
not permitted by banks:
Parent company's overdrawn checking
account with bank subsidiary
Payment of organization costs by bank
subsidiary

Federal Reserve Act 23B- Restricitons
on Transactions with Affiliates
Expands the range of retrictions on
transactions with affiliates.
Any transaction by a member bank or its
subsidiary with any person shall be
deemed to be a transaction with an
affiliate of such bank.

Regulation W: Transations between
Banks and their Affiliates
Implements sections 23A and 23B of the Federal
Reserve Act, which establish certain restrictions
on and requirements for transactions between a
member bank and its affiliates.
It applies to all fedrally-insured depository
instituions and requires that transactions
between member banks uphold stipulations.

Regulation U:Securities Credit by
Banks
Provides certain requirements applicable to
loans that are made for the pupose of
enabling the borrower to puchase or carry
margin stock.
Requires U-1 form if loan collateralized by
stocks, bonds etc. over $100,000.

Physical Security
National Institute for Occupational Safety and
Health depicts workplace violence as any
physical assault, threatening behavior or verbal
abuse occurring in the work setting.
Devon Bank employees should be knowledgeable
and maintain awareness in regards to possible
work place violence.

Real Estate Lending
Reminds institutions that strong risk
management practice and appropriate
levels of capital are essential elements of
a sound commercial real estate.

Service Members Civil Relief
Act
Offers short-term financial and legal relief to
military personnel and their dependants, by
placing specific requirements on the financial
service industy and legal system.
It provides a wide range of protections for
individuals entering, called to active duty in the
military or deployed service members.

Sexual Harassment
It is necessary for all employees to be
knowledgeable in what is and what is not
acceptable behavior at Devon Bank.
In order to minimize the banks sexual harassment
complaints, all employee should keep a look out
for inappropriate conduct/language, speak up to
prevent it and report incidents with the HR.

You have just completed the review of
Federal Rules and Regulation for the
Devon Bank Commerical Lending
Department
Next you will complete the practice
activities

Question #1
Which regulation ensures bank employees protect
customer and employee information:
a) Bank Secrecy Act
b) Anti-Money Laundering Act
c) Information Security
d) Gramm-Leach-Bliley Act

Question #2
Bank Secrecy Act requires Devon Bank to keep
records of funds transferred and
transmitted of….
a) $1,000 and higher
b) $3,000 and higher
c) $5,000 and up
d) $10,000 and more

Question #3
The function of the Patriot Act is to deter
and punish terrorist acts in the United
States:
a) True
b) False

Congratulations you have completed the
Devon Bank Commerical Lending
Compliance Training!