Regulation Citations in Board Reports
Aug 02, 2023Question: Can you clarify this for me, its from our legal department.
…. I haven’t noticed this in the past, but as an FDIC regulated state-chartered bank, the governing regulation for your report is not the Federal Reserve Board’s Regulation H, but rather the FDIC’s regulation at 12 CFR Part 326. This change in citation, which I have made to the first page of the report (see attached), should also be made to the bank’s Security Policy, which I believe comes up for approval by the Board in June.
Answer: I seldom get a chance to use my compliance certification when answering questions like this one. Your legal department is correct in what they are telling you should be on your report. When teaching our program on “The Beginning Security Officer,” we touch on this very briefly. The regulations depending on your regulator are:
- FRS 12 CFR Part 208.61(a)
- FDIC 12 CFR Part 326.0(a)
- OCC 12 CFR Part 21.2(a)
These were considered jointly by the regulators when written, so they are basically the same regulation. The industry normally just refers to it as “Regulation H,” as it is called by the Federal Reserve Board. Meeting planners who call us on the telephone normally ask us to teach “Regulation H,” as that is what the bankers normally have asked to be taught. It is the same regulation, however on your board report, I would use the citation for your regulator, not Regulation H.
Most Credit Unions don’t believe they are under any requirements like Regulation H, which is incorrect. Please look up “NCUA Letter to Credit Unions number 02-CU-12.” Read it carefully. That, my friends, is “Regulation H.” I believe this should have been a regulation for Credit Unions. It will come as a nasty surprise if a Credit Union has someone shot or killed when the person or estate sues them. Many Credit Unions have no idea this letter is active today.
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