Pub. 7 2017 Issue 3

9 ISSUE 3. 2017 Alisa Lacey » 602.212.8628 alisa.lacey@stinson.com Bob Monroe » 816.691.3351 bob.monroe@stinson.com Ernie Panasci » 303.376.8402 ernie.panasci@stinson.com Deborah Bayles » 303.376.8401 deborah.bayles@stinson.com LEGAL PARTNERS YOU CAN TRUST. Our advantage is simple —we understand the business. Stinson Leonard Street’s banking attorneys have broad experience in matters related to financial services, including commercial lending, mergers and acquisitions, regulations and compliance, litigation, bankruptcies and payment systems. Bank on our reputation and knowledge. Our Phoenix Office: 1850 North Central Ave., Suite 2100, Phoenix, AZ 85004 STINSON LEONARD STREET LLP \\ STINSON.COM \\ LAW OFFICES IN 13 U.S. LOCATIONS The choice of a lawyer is important and should not be based solely on advertisements. they provide more protection, not less. For example, in California re - serve members called into active duty are entitled to defer payments on a whole host of loan types. Other states have statutes making a violation of the MLA a violation of state law, posing the possibility of additional liability for violations. Evaluate Evaluation of the bank’s existing level of compliance is critical. Mili - tary lending is a pervasive compliance risk, reaching from the Board of Directors to the teller. Key areas to consider include eligibility management, loan servicing, vendor oversight, SCRA/MLA benefit allowances and denials, and product development. Implement Though designing compliance structure is always bank-specific, some general considerations are useful in the military lending arena. Bank software may not be adaptable to the distinct nature of military lending requirements, so it might be necessary to implement a manual system to tackle factors like eligibility, rate compliance and review, and enforcement action compliance. The status of an individual customer can change quickly, either in to or out of coverage under the regulations. Therefore, it is incumbent on the bank to incorporate an effective monitoring system. The grave impact of personnel training and education cannot be overstated, with myriad enforcement actions citing deficiencies therein. Interde - partmental communication, such as between compliance and product development, is another essential consideration in the implemen - tation effort. Finally, managing third party vendor compliance can make or break the enterprise-wide military lending management effort, a point emphasized in the same speech by the OCC official mentioned earlier. Conclude I Must It is clear the risks banks face for noncompliance with military lending law and regulation are far-reaching, including reputation, compliance, legal, and safety and soundness. Conversely, compliance can and often does lead to enhanced relationships with the military community forging partnerships that last a lifetime. It would be a tough pill to swallow to believe that most banks fail to comply with military lending law and regulation intentionally, but as we all know, the road to hell is paved with good intentions – and minefields. Let your compliance management system be your goldmine. w Kimberly serves as Associate General Counsel for Compliance Alliance. She is a Magna Cum Laude graduate of St. Mary’s Uni - versity School of Law and holds a Bachelor of Arts in Political Science from the University of Texas at San Antonio, also with the Magna Cum Laude distinction. Kimberly brings value to our member banks through her experience during law school at both a regional and national financial institution and through over a decade of business management experience attained prior to law school. She de - veloped a passion for banking regulation while performing extensive legal research on topics including financial institution law, commercial paper, and corporations. In her spare time, she and her husband wrangle four little boys aged 8 and under, including a set of fraternal twins.