In the November 14, 2016, Federal Register (81 FR 79473, click here) the Federal Financial Institutions Examination Council (FFIEC), on behalf of its members-the Board of Governors of the Federal Reserve System (FRB), the Consumer Financial Protection Bureau (CFPB), the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA), the Office of the Comptroller of the Currency (OCC), and the State Liaison Committee (SLC) (the Agencies)-published a revised Uniform Interagency Consumer Compliance Rating System (the CC Rating System), effective for consumer compliance examinations that begin on or after March 31, 2017. Overview of CC Rating System The CC Rating System is a supervisory policy for evaluating financial institutions’ adherence to consumer compliance requirements. It provides a general framework for evaluating compliance assessment factors in order to assign a consumer compliance rating to each federally regulated financial institution. The CC Rating System is based upon a scale of 1 through 5, in increasing order of supervisory concern – i.e., 1 represents the highest rating and the lowest level of supervisory concern, while 5 represents the lowest rating and the most critically deficient level of performance and the highest degree of supervisory concern. The CC Rating System is risk-based in line with Agencies’ current risk-based, tailored examination processes. It emphasizes the importance of an institution’s compliance management system (CMS), with emphasis on compliance risk management practices designed to manage consumer compliance risk, support compliance, and prevent consumer harm. The CC Rating System conveys to examiners that assessment factors associated with an institution’s CMS should be evaluated commensurate with the institution’s size, complexity, and risk profile. It also establishes incentives for institutions to promote consumer protection by preventing, self-identifying, and addressing compliance issues in a proactive manner by recognizing institutions that consistently adopt these compliance strategies.
