Checklist & Workbook: Business Continuity Plan, Includes COVID-19 Pandemic Response - Update # 7

We have updated the Business Continuity Plan Checklist & Workbook, Includes COVID-19 Pandemic Response ("Checklist"). 

I am pleased to announce the publication of Update # 7.

We published the initial Checklist on Monday, March 16th, consisting of 60 pages. Today’s update is 207 pages and contains many new sections, updates, and additional resources.

New sections include outlines and guidelines, as follows:

- Coronavirus Economic Stabilization Act (CESA) 

- Paycheck Protection Program (PPP)

- Paycheck Protection Program (PPP) - Dicta

- Links to State Issuances for Remote Activities

- Business Interruption Insurance - Checklist

The Checklist is being provided on a complimentary basis. It is our view that companies in need of immediate guidance should be able to get it without cost in the midst of a pandemic. 

You can request the most recent version HERE. 

Let’s continue to work together for the benefit of one another, our families, companies, communities, and cherished consumers.

Best wishes,
Jonathan

Jonathan Foxx, Ph.D., MBA
Chairman & Managing Director
Lenders Compliance Group

Webinar: Checklist & Workbook - Business Continuity Plan and COVID-19 Pandemic Response

Announcement

Message from Jonathan Foxx, Ph.D., MBA, 

Chairman & Managing Director

Lenders Compliance Group

We are presenting a Free Webinar, entitled

Navigating the 

Checklist & Workbook

Business Continuity Plan and 

COVID-19 Pandemic Response.

Webinar: Thursday, April 16, 2020, 1PM-ET

     

We pioneered and authored the Checklist &Workbook. 

Now we want to let you know how to navigate it.

This webinar is your chance to learn how to use the Checklist!

Since its publication on March 16^th, we have received thousands of downloads.

The Checklist now consists of 6 Modules and 180 pages!

Demand is going to be high, seating is limited, so register now while there’s still space!

COVID-19 has made us take a close look at this pandemic response in the context of a Business Continuity Plan.

Here’s what you get when you attend Navigating the Checklist & Workbook:

• Update # 6 – new release – you will receive it before anyone else!
• Subject Matter Experts will present critical insights and guidance.
• Written questions during the webinar answered individually after the webinar.
• Slides
• Recording 

As I pointed out, we have limited seating for this event. Please register as soon as possible.

Webinar: Thursday, April 16, 2020, 1PM-ET

Let’s continue to work together for the sake of our companies, employees, and families.

Best wishes!

Lenders Compliance Group issues complimentary Business Continuity Plan Checklist (Includes COVID-19 Pandemic Response)

PRESS RELEASE

Modules directly address the specific requirements needed to maintain business continuity in general as well as provide business continuity during the COVID-19 Pandemic in particular.

Lenders Compliance Group (LCG), the first and only full-service compliance firm with a suite of compliance solutions for residential mortgage lenders and originators, has issued today a valuable tool, entitled Business Continuity Plan Checklist & Workbook (Includes COVID-19 Pandemic Response).

The checklist is a valuable development tool to chart the progress in developing a Business Continuity Plan. This is a 60-page, form-fillable document that provides the basic compliance elements and due diligence essentials at this most critical time in the outbreak of the COVID-19 Pandemic.

There are distinct differences between pandemic planning and traditional business continuity planning. Pandemic planning presents unique challenges. Unlike natural disasters, technical disasters, malicious acts, or terrorist events, the impact of a pandemic is much more difficult to determine because of the anticipated difference in scale and duration.

Lenders Compliance Group is providing the Business Continuity Plan Checklist & Workbook (Includes COVID-19 Pandemic Response) on a complimentary basis to the financial services industry.

There are five modules, as follows:

Module 1: Business Continuity Team

Module 2: Facilities Continuity

Module 3: Recovery Requirements

Module 4: Pandemic Planning for COVID-19

Module 5: Generalized Pandemic Response based on NYS Model

Additional sections, some of which contain subsections, provide:

• Team Alert List
• Employee Call List Instructions
• Critical Vendors List (Sample Format)
• Key Customer Description
• Meeting Place Description
• Model Risk Matrix (Sample Format)

The Business Continuity Plan Checklist & Workbook (Includes COVID-19 Pandemic Response) is meant as a means toward building a functionally adequate Business Continuity Plan. Each financial institution is different and processes will vary. However, management should consider how to accomplish the following:

• Prevention and preparedness;
• Reconciling recovery times with business unit requirements;
• Disaster declaration and plan implementation processes;
• Recovery progress reporting; and
• Testing of the plans.

Lenders Compliance Group has established a dedicated form to request a complimentary copy of the Business Continuity Plan Checklist & Workbook (Includes COVID-19 Pandemic Response) directly from its website Home Page at www.LendersComplianceGroup.com.

Announcement: NYS/DFS issues Guidance and Requirements for Coronavirus Risk

The New York State Department of Financial Services (DFS) has issued guidance and a request for assurance to ensure that financial institutions are identifying, monitoring, and managing the potential financial risk arising from the spread of a novel coronavirus known as “COVID-19”.

To that end, DFS is requiring each regulated institution to submit a response to DFS describing the institution’s plan regarding managing the potential financial risk arising from COVID-19. 

Responses are to be provided to DFS as soon as possible, 

but in no event later than thirty (30) days from March 10, 2020.  

We have previously published information to manage the coronavirus risk to financial institutions HERE.

The issuance, Guidance to New York State Regulated Institutions and Request for Assurance Relating to Potential Financial Risk Arising from the Outbreak of the Novel Coronavirus, sets forth specific compliance requirements.

Review the NYS/DFS Industry Letter 

HERE

According to the Department of Financial Services, it is critical that your risk management programs include a plan to assess and monitor the potential financial risk that may arise from the outbreak of COVID-19.  

Such a plan, at a minimum, should include the following assessments:

1. Assessment of the credit risk ratings of the customers, counterparties and business sectors impacted by COVID-19;
2. Assessment of the credit exposure to customers, counterparties and business sectors impacted by COVID-19, arising from lending, trading, investing, hedging and other financial transactions, including any credit modifications, extensions and restructurings (including capitalizations of interest);
3. Assessment of the scope and the size of credits adversely impacted by COVID-19 that currently are in, or potentially may move to, non-performing/delinquent status, including consideration of stress testing and/or sensitivity analysis of loan portfolios and the adequacy of loan loss reserves;
4. Assessment of the valuation of assets and investments that may be, or have been, impacted by COVID-19; 
5. Assessment of the overall impact of COVID-19 on earnings, profits, capital, and liquidity (including impact on loan-to-deposit ratio) of your institutions; and
6. Assessment of reasonable and prudent steps to assist those adversely impacted by COVID-19.  

The boards of directors or the equivalents of your institutions are responsible for ensuring that appropriate plans are in place and that sufficient resources are allocated to implement such plans.  

The senior management of institutions is responsible for ensuring effective policies, processes and procedures are in place to execute the plan and for communicating the plan throughout the institution to ensure consistency in approach so that employees understand their roles and responsibilities. 

If you need assistance, we can help with a cost-effective Busines Continuity Plan. We also provide a Disaster Recovery & Business Continuity Plan or, separately, just the Business Continuity Plan. 

You will work with a Subject Matter Expert to conform the plan to your business model.

We have reduced our fees for these policies to ensure that financial institutions are able to implement protective and preventive measures as well as comply with regulatory expectations.

Contact us HERE! We will send you a presentation and proposal. 

Or, send us an email HERE to discuss your particular compliance needs.

Announcement: Interagency Statement on Pandemic Planning

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FFIEC has issued guidance on pandemic planning, entitled Interagency Statement on Pandemic Planning (“Guidance”). This issuance is meant to heighten the response of financial institutions to the coronavirus pandemic. The Guidance identifies actions that financial institutions should take to minimize the potential adverse effects of a pandemic. Specifically, the institution’s business continuity plan (BCP) should address pandemics and provide for a preventive program, a documented strategy scaled to the stages of a pandemic outbreak, a comprehensive framework to ensure the continuance of critical operations, a testing program and an oversight program to ensure that the plan is reviewed and updated.

We have been notifying you on how to protect your companies, customers, employees, families, and communities HERE. Please review those articles and act accordingly. 

If you want to discuss your specific pandemic preparation requirements, please contact us at compliance@lenderscompliancegroup.com.

We believe that Disaster Recovery and Business Continuity should be combined, but, as the Guidance states “pandemic planning activities should involve senior business management from all functional, business and product areas, including administrative, human resources, legal, IT support functions, and key product lines.”

The pandemic segment of the BCP must be "sufficiently flexible to address a wide range of possible effects that could result from a pandemic," and also be reflective of the institution’s size, complexity, and business activities. 

Our position is that there are two types of BCPs: standard and enhanced. 

The standard version lacks due diligence and independent risk assessment but does provide a basic outline to follow to ensure business continuity. 

The enhanced version is preferred by regulators because it contains due diligence and independent risk assessment. The enhanced version is obviously preferable to the standard version, because it provides specific due diligence, auditing done by subject matter experts, and leads to an independent risk assessment. The risk assessment reveals strengths and weaknesses further provides actionable recommendations. The standard version is less expensive to draft than the latter, but can be used as a baseline to ensure that your company is taking some affirmative actions to contain the spread of the coronavirus.

The Guidance is unequivocal in its directives: 

The adverse economic effects of a pandemic could be significant, both nationally and internationally. Due to their crucial financial and economic role, financial institutions should have plans in place that describe how they will manage through a pandemic event. Sound planning should minimize the disruptions to the local and national economy and should help the institution maintain the trust and confidence of its customers. [Emphasis in original.]

According to the Guidance, “pandemic planning presents unique challenges to financial institution management. Unlike natural disasters, technical disasters, malicious acts, or terrorist events, the impact of a pandemic is much more difficult to determine because of the anticipated difference in scale and duration.”

The following constitute the actions that management should be undertaking, per the Guidance:

1. A preventive program to reduce the likelihood that an institution’s operations will be significantly affected by a pandemic event, including the monitoring of potential outbreaks, educating employees, communicating and coordinating with critical service providers and suppliers, in addition to providing appropriate hygiene training and tools to employees.

2. A documented strategy that provides for scaling the institution’s pandemic efforts so they are consistent with the effects of a particular stage of a pandemic outbreak, such as first cases of humans contracting the disease overseas, first cases within the United States, and first cases within the organization itself. The strategy will also need to outline plans that state how to recover from a pandemic wave and proper preparations for any following wave(s).

3. A comprehensive framework of facilities, systems, or procedures that provide the organization the capability to continue its critical operations in the event that large numbers of the institution’s staff are unavailable for prolonged periods. Such procedures could include social distancing to minimize staff contact, telecommuting, redirecting customers from branch to electronic banking services, or conducting operations from alternative sites. The framework should consider the impact of customer reactions and the potential demand for, and increased reliance on, online banking, telephone banking, ATMs, and call support services. In addition, consideration should be given to possible actions by public health and other government authorities that may affect critical business functions of a financial institution.

4. A testing program to ensure that the institution’s pandemic planning practices and capabilities are effective and will allow critical operations to continue.

5. An oversight program to ensure ongoing review and updates to the pandemic plan so that policies, standards, and procedures include up-to-date, relevant information provided by governmental sources or by the institution’s monitoring program.

The Guidance provides helpful and important links to information resources, as follows:

1. The National Strategy for Pandemic Influenza (National Strategy) and the Implementation Plan for the National Strategy for Pandemic Influenza  (National Implementation Plan) issued by the federal government provide a complete guide to pandemic planning. 

The documents can be found at https://www.cdc.gov/flu/pandemic-resources/index.htm.

Coronavirus: CDC Guidance - An Urgent Message

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The Center for Disease Control and Prevention (CDC) has issued an alert regarding the Coronavirus Disease, entitled Interim Guidance for Businesses and Employers to Plan and Respond to Coronavirus Disease 2019 (COVID-19), February 2020.

This Interim Guidance (“Guidance”) is based on what is currently known about the coronavirus disease 2019 (COVID-19). The CDC will update this Guidance as needed and as additional information becomes available.

Read the CDC's Guidance HERE.

Unfortunately, much is unknown about how the virus that causes COVID-19 spreads. Current knowledge is largely based on what is known about similar coronaviruses.

The Guidance is meant to help prevent workplace exposures to acute respiratory illnesses, including COVID-19, in non-healthcare settings. The guidance also provides planning considerations if there are more widespread, community outbreaks of COVID-19.

Lenders Compliance Group is willing to help!

At this time, we suggest that you review your Disaster Recovery and Business Continuity Plan (“DRBC”), as the impact, features, factors, procedures, and policy requirements relating to COVID-19 should be set forth therein. The plan should include the CDC’s recommended strategies for employers to implement. 

Due to this emergency, if you need help with your DRBC, Lenders Compliance Group is offering to provide its DRBC review, assessment, risk rating, recommendations, and policy at a 20% discount from our already low fee. If the cost is a bit tough to manage, we will give you an affordable payment plan. Avoid the manual mills, one-size-fits-all, and fill-in-the-blanks versions. The DRBC must be customized to your institution to be effective and meet regulatory scrutiny!

To request support with your DRBC, click HERE.

EMPLOYER ACTIONS

• Ensure the plan is flexible and involve your employees in developing and reviewing your plan.
• Conduct a focused discussion or exercise using your plan to find out ahead of time whether the plan has gaps or problems that need to be corrected.
• Share your plan with employees and explain what human resources policies, workplace and leave flexibilities, and pay and benefits will be available to them.
• Share best practices with other businesses in your communities (especially those in your supply chain), chambers of commerce, and associations to improve community response efforts. 

Response Plan

There are numerous actions that must be implemented now. 

Do not wait! 

Time is not on your side!

• Identify possible work-related exposure and health risks to your employees.
• Review human resources policies to make sure that policies and practices are consistent with public health recommendations and are consistent with existing state and federal workplace laws.
• Explore whether you can establish policies and practices, such as flexible worksites (i.e., telecommuting) and flexible work hours (i.e., staggered shifts), to increase the physical distance among employees and between employees and others if state and local health authorities recommend the use of social distancing strategies.
• Identify essential business functions, essential jobs or roles, and critical elements within your supply chains (i.e., raw materials, suppliers, subcontractor services/products, and logistics) required to maintain business operations.
• Plan for how your business will operate if there is increasing absenteeism or these supply chains are interrupted.
• Set up authorities, triggers, and procedures for activating and terminating the company’s infectious disease outbreak response plan, altering business operations (i.e., possibly changing or closing operations in affected areas), and transferring business knowledge to key employees.
• Plan to minimize exposure between employees and also between employees and the public, if public health officials call for social distancing.
• Establish a process to communicate information to employees and business partners on your infectious disease outbreak response plans and latest COVID-19 information.
• Anticipate employee fear, anxiety, rumors, and misinformation, and plan communications accordingly.
• In some communities, early childhood programs and K-12 schools may be dismissed, particularly if COVID-19 worsens. Determine how you will operate if absenteeism spikes from increases in sick employees, those who stay home to care for sick family members, and those who must stay home to watch their children if dismissed from school.
• Local conditions will influence the decisions that public health officials make regarding community-level strategies; employers should take the time now to learn about plans in place in each community where they have a business.
• If there is evidence of a COVID-19 outbreak in the US, consider canceling non-essential business travel to additional countries per travel guidance on the CDC website.
• Travel restrictions may be enacted by other countries which may limit the ability of employees to return home if they become sick while on travel status.
• Consider cancelling large work-related meetings or events.
• Engage state and local health departments to confirm channels of communication and methods for dissemination of local outbreak information.

CFPB Posts New FAQs on TRID

The Consumer Financial Protection Bureau (CFPB) has posted Frequently Asked Questions related to the TRID Rule and lender credits. 

Visit TILA-RESPA Integrated Disclosure FAQs

Topics Covered

• Corrected Closing Disclosures (CDs) and the 3-Business Days waiting period before consummation
• Model Forms
• Construction Loans
• Providing Loan Estimates (LEs) to Consumers
• Lender Credits

Questions

Corrected Closing Disclosures

1. If there is a change to the disclosed terms after the creditor provides the initial Closing Disclosure, is the creditor required to ensure the consumer receives a corrected Closing Disclosure at least three business days before consummation?
2. Is a creditor required to ensure that a consumer receives a corrected Closing Disclosure at least three business days before consummation if the APR decreases (i.e., the previously disclosed APR is overstated)?
3. Does Section 109(a) of the Economic Growth, Regulatory Relief, and Consumer Protection Act affect the timing for consummating a transaction if a creditor is required to provide a corrected Closing Disclosure under the TRID Rule?

Model Forms

1. Does a creditor’s use of a model form provide a safe harbor if the model form does not reflect a TRID Rule change finalized in 2017?

Construction Loans

1. Are construction-only loans or construction-permanent loans covered by the TRID Rule?
2. Are there special disclosure provisions for construction-only or construction-permanent loans under the TRID Rule?

Providing Loan Estimates (LEs) to Consumers

1. When is a creditor required to provide a Loan Estimate to a consumer?
2. Can creditors require consumers to provide additional information (other than the six pieces of information that constitute an application under the TRID Rule) in order to receive a Loan Estimate?
3. Can creditors require consumers to submit verifying documents in order for the consumer to receive a Loan Estimate?
4. Is the requirement to provide a Loan Estimate triggered if the consumer submits the six pieces of information in order to receive a pre-approval or pre-qualification letter?
5. What if a creditor needs to collect additional information (other than the six pieces of information that constitute an application for purposes of the TRID Rule) or verifying documents to process a pre-approval or pre-qualification request?

Lender Credits

1. What is a lender credit for purposes of the TRID Rule?
2. What is the difference between a specific lender credit and a general lender credit?
3. Is a creditor required to disclose a closing cost and a related lender credit on the Loan Estimate if the creditor will absorb the cost?
4. Is a creditor required to disclose a closing cost and related lender credit on the Closing Disclosure if the creditor will absorb the cost?
5. How are lender credits disclosed on the Loan Estimate?  
6. How are lender credits disclosed on the Closing Disclosure?
7. How does a creditor disclose lender credits for a loan that the creditor refers to as a "no-cost loan"?
8. How does a creditor disclose lender credits if the creditor provides a credit, rebate, or reimbursement to offset specific closing costs charged to the consumer?
9. How does a creditor disclose lender credits when it is offsetting a certain dollar amount of closing costs charged to the consumer without specifying which costs it is offsetting?
10. Can lender credits change?

Email: Compliance@LendersComplianceGroup.com

Phone: 866-602-6660

Voicemail: 866-255-6466

Monthly Mortgage Compliance - Semi-Annual Opportunity

Message from Jonathan Foxx, Ph.D., MBA 
Chairman & Managing Director
Lenders Compliance Group.

________________________________

Twice each year, we open our doors to new clients to join our family of clientele that use our monthly mortgage compliance support. 

During this discount enrollment period, we discount our already low monthly flat fee. The timeframe to take advantage of this offer ends on March 31st. 

We offer the discount as an expression of our mission. Let me explain.

When I started Lenders Compliance Group in 2006, there were virtually no other mortgage compliance and risk management companies around. My idea was to offer a team of the top compliance experts at a fraction of the cost it would be to retain any of them individually. At first, it was rough going, because companies had become grudgingly dependent on high fees and high payroll costs. One by one, they joined us and in time Lenders Compliance Group became the preeminent compliance firm in the country.

Of course, soon the copycats popped up, jumping onto what they thought was a big money-making bandwagon. But I said then, as I say now, 'I welcome competition.' The hybridization of compliance firms mystified me at first, such as firms that offered boilerplate policies and procedures for next to nothing but slammed lenders with excessive monthly fees, law firms that previously had no mortgage compliance departments all of a sudden sprung up with their various "compliance divisions," and quality control firms that had no real mortgage compliance experience except for providing QC auditing yet parleyed their client list. Unfortunately, and inevitably, many lenders were chiseled, chastened, but happily came to us. 

Believe it or not - and I have said this many times - we choose our clients as much as they choose us. Not every client is a good fit, and just because they have a lot of money or clout does not mean they are right for us. We seek lenders that are serious about implementing compliance, not trying to find a way to twist a regulation into an unrecognizable shape. We'll sometimes modestly push the compliance envelope, but only so much! If you conduct compliance on the basis of a cost/benefit ratio, you're probably not a good fit for us.

I'm proud of what we've accomplished, and it all began with monthly compliance support. In effect, we become an extension of your office!

We now provide the largest range of compliance services - all of it hands-on, personal, and direct! But we will always stick by our vision to provide a safe and sound approach to monthly compliance.

So, what do you get as a monthly mortgage compliance client? This -

Low Monthly Flat Fee

On-going Compliance Support

Supervised by Directors

Subject Matter Experts

Unlimited Questions

Most Policy Documents

Secure Record Storage

Dedicated Team

If you are a lender that needs cost-effective regulatory compliance guidance relating to mortgage acts, rules, regulations, and Best Practices, and you are committed to safety and soundness, you should contact us. We'll provide independent, reliable, low cost, on-going support to your compliance team!

If you miss out on this opportunity for a reduced fee, we'll be providing the offer again later this year. The deadline is March 31st. But why wait? 

Just contact us and we'll send you a one-page presentation, and you can also speak with me or one of our Directors to discuss your compliance needs. 

If you're interested, we'll give you a simple form to complete that lets us know a little about your organization, so that we can send you an engagement proposal with appropriate pricing, staffing, and scope. We're usually able to get started immediately!

Click the sidebar button or feel free to contact us at your convenience via email, phone, or even leaving a voicemail. 

Email: Compliance@LendersComplianceGroup.com
Phone: 866-602-6660
Voicemail: 866-255-6466

Wishing you all the best!