SDBA eNews: June 22, 2017

In This Issue

SBS CyberSecurity Acquires Compliance Advisory Services

SBS CyberSecurity, LLC (SBS), a premier cybersecurity consulting and audit firm, announced the acquisition of Compliance Advisory Services (CAS), a nationally-known consulting firm with an emphasis on compliance issues in the financial services industry.

The acquisition of CAS, based out of Austin, Texas, represents a unique opportunity for SBS to expand their reach and provide CAS clients with a wealth of cybersecurity resources, products and services.

CAS is now a wholly-owned subsidiary of SBS CyberSecurity LLC. The integration of these two companies will take place over the next six months. Learn more about SBS at

Hacker Hour: Incident Response Round Table

One of the best ways to train key employees on your incident response team is to conduct a walk through or functional test of the current incident response plan. Join SBS CyberSecurity for Hacker Hour: Incident Response Round Table on Wednesday, June 28, at  2 p.m. CDT.

The free webinar and round table discussion will cover typical cybersecurity incidents that you should be ready for and share your ideas on how to handle these events. SBS will share how it is helping organizations create and maintain a good incident response plan/process.

Learn more and register.


Question of the Week

How do you report an application in which the applicant does not respond to a conditional approval?

Answer: If the bank sent a notice of incompleteness and the applicant did not respond at all, the bank would use Code 5—File closed for incompleteness. If the bank did not send a notice of incompleteness and the applicant did not respond or meet the underwriting conditions, the bank would use Code 3—Application denied.

Not a Compliance Alliance member? Learn more about membership with Compliance Alliance by attending one of our live demos:

Compliance rules and regulations change quickly. For timely compliance updates, subscribe to Compliance Alliance’s email newsletters.

Compliance Alliance offers a comprehensive suite of compliance management solutions. To learn how to put them to work for your bank, call 888.353.3933 or email.

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Contact Alisa DeMers, SDBA, at 800. 726.7322 or via email.

SDBA Membership Elects 2017-2018 Officers

Photo of 2017-2018 SDBA OfficersSDBA membership elected new officers for 2017-2018 at the annual business meeting held June 6 during the 2017 Quad States Convention in Rapid City. (L-R: Shawn Rost, Karl Adam, Paul Domke and Dave Rozenboom)

The new officers started their year-long terms immediately following the meeting. The new officers are:

  • Chairman: Dave Rozenboom, President, First PREMIER Bank, Sioux Falls
  • Chairman-Elect: Karl Adam, Market President, First Dakota National Bank, Pierre
  • Vice Chairman: Shawn Rost, South Dakota Market President, First Interstate Bank, Rapid City
  • Immediate Past Chair: Paul Domke, President/CEO/CCO, Heartland State Bank, Redfield

The official election took place at the Quad States Convention of the SDBA, along with North Dakota, Montana and Wyoming, June 4-6 in Rapid City. The term for the new officers is effective now through next year’s annual convention in June. Read more about each director.

Rick Nath Appointed to Fill SDBA Board Vacancy

Photo of Rick NathThe SDBA Board of Directors has appointed Rick Nath, Citibank, N.A., Sioux Falls, to fill a vacant seat on its Board of Directors. Nath will represent banks in the Credit Card Category.

Rick Nath serves as Citi’s sixth site president in Sioux Falls. Nath, as the site president, is responsible for driving and executing site governance, people strategy, site culture and community involvement.

In addition to his duties as site president, Nath is a group manager for North American Cards, leading the marketing and servicing application suites in support of operations for both branded cards and retail bank. He is also responsible for managing application delivery for the marketing resource management and offer management platforms in support of managing Citi’s marketing financials, as well as its online acquisition strategy.

Nath earned a bachelor’s degree in mathematics from South Dakota State University and has also served on the Industry Advisory Board for Computer Science at his alma mater. In addition, Nath serves as chairman of the Department Stores National Bank CRA Committee and is serving as treasurer/board member of the Sioux Empire Baseball Association. Learn more.

Minnehaha County Man Convicted for Financial Elder Abuse

Attorney General Marty Jackley announced Tuesday that a Minnehaha County jury returned a verdict finding Ronald Wayne Whalen, 47, Sioux Falls, guilty of 1 count of forgery, class 5 felony, punishable by up to five years imprisonment and/or $10,000 fine.

“The Attorney General’s Elder Abuse Division is working hard to protect our seniors from fraud and abuse. If you have any information about elder abuse, please contact the Attorney General’s Office at 605.773.3215,” said Jackley.

Charges stem from an incident in which the defendant took financial advantage of his senior neighbor on Jan. 30, 2017.
This case was investigated and prosecuted by the South Dakota Attorney General’s Elder Abuse and Financial Exploitation Subdivision. A sentencing date has not yet been scheduled.

Regulators to Support Certain Reg Relief Measures in Hearing Today

The heads of the regulatory agencies are expected to endorse various proposals for regulatory relief today in a hearing in the Senate Banking Committee. The hearing will begin at 10 a.m.

In written testimony submitted in advance of the hearing, representatives from the Federal Reserve, FDIC and the Office of the Comptroller of the Currency expressed support for various actions to simplify the stress testing process, more closely tailor regulation and encourage the formation of new banks. Several measures addressed by the regulators echoed recommendations from the recent Treasury report on regulatory reform that was released earlier this month.

Notably, Federal Reserve Governor Jerome Powell expressed his agency’s support for extending the timeline for living will submissions from annually to every two years. FDIC Chairman Martin Gruenberg agreed, calling the change “worthwhile” and adding that “there may be opportunities to greatly reduce the submission requirements for a large number of firms due to their relatively small, simple and domestically-focused banking activities.” Regulators also supported revisiting various asset-size thresholds, including the $10 billion threshold for company-run stress tests and the $50 billion threshold for enhanced prudential standards.

As part of efforts to remove outdated, unnecessary or overly burdensome regulation, Acting Comptroller of the Currency Keith Noreika proposed that Treasury conduct a periodic review of all Bank Secrecy Act Regulations, similar the EGRPRA process. This “would give financial institutions an opportunity to express their concerns directly to the agency with the authority issue, repeal and modify BSA rules,” Noreika said in his written statement.

In addition, Noreika proposed that Congress streamline the de novo application process by giving new banks the ability to obtain FDIC deposit insurance upon receiving a charter from the OCC. Currently, banks are required to submit an application to both the FDIC and the chartering authority (either the OCC or state regulatory agency, depending on charter type). Noreika recommended that Congress consider designating a time period that the FDIC could object to the granting of deposit insurance following the charter approval by OCC or state regulator.

Regulators also said they would be receptive to, among other things, an exemption for small banks from the Volcker Rule, additional enhancements to the capital planning and stress-testing process and additional exam relief, particularly for community banks. Read the regulators' testimonies. For more information, contact ABA's Wayne Abernathy.

House Passes Five Flood Insurance Bills

The House Financial Services Committee yesterday approved five bills as part of a legislative package intended to reauthorize the National Flood Insurance Program.

Lawmakers unanimously approved two ABA-supported bills: H.R. 2875, the National Flood Insurance Program Administrative Reform Act of 2017, which would make administrative changes to the NFIP to increase fairness and accuracy and decrease taxpayer risk; and H.R. 1422, the Flood Insurance Market Parity and Modernization Act, which would encourage development of a robust private flood insurance market as an alternative to the NFIP. The committee also approved by a voice vote H.R. 1558, a bill introduced by Rep. Ed Royce (R-Calif.) to amend the National Flood Insurance Act of 1968 to ensure community accountability for areas repeatedly damaged by floods.

Additionally, the committee passed two bills introduced by Rep. Blaine Luetkemeyer (R-Mo.), H.R. 2264 and H.R. 2565, both of which ABA strongly supported. H.R. 2264, the Taxpayer Exposure Mitigation Act of 2017, would enable the NFIP to engage in private-sector risk transfer deals and would allow the development of private or community flood maps as an alternative to NFIP’s outdated maps. H.R. 2565 would require the NFIP to study how it uses replacement costs in setting premiums.

Together with H.R. 2874 and H.R. 2868, which were passed by the committee last week, the bills will now move to the full House for consideration. ABA will continue to work closely with lawmakers to ensure that the NFIP is renewed prior to its expiration date on Sept. 30.

Trump Names Banking Lawyer to Lead FDIC

President Trump last Friday said he would nominate James Clinger to serve as FDIC chairman. According to the White House, Clinger will be nominated first to fill the long-vacant director position on the FDIC Board and then nominated to serve a five-year term as chairman after Martin Gruenberg's term ends in November.

Clinger has been chief counsel to the House Financial Services Committee for a decade. During the George W. Bush administration, he served as a deputy assistant attorney general, prior to which he was a staffer on the Financial Services Committee for another decade. He began his legal career in private practice.

The announcement comes as Trump continues to fill out his financial regulatory team. The president recently announced that he would name Joseph Otting as comptroller of the currency. There are several vacancies on the Federal Reserve Board of Governors, and nominees are expected to be named soon for at least one of those posts. Read more.