The Latest on SBA, PPP, NCUA, GSEs, BSA, CFPB, and FHLB

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The U.S. Small Business Administration has released an interim final rule (IFR) that informs Paycheck Protection Program (PPP) borrowers and lenders of the process for a PPP borrower to appeal certain SBA loan review decisions to the SBA Office of Hearings and Appeals (OHA). The IFR establishes a new subpart L for 13 CFR part 134Click here to read the IFR.

SBA Application Cybersecurity Scam Alert
Credit unions should ensure they are accessing the correct SBA resources, as the Cybersecurity and Infrastructure Security Agency issued an alert Aug. 12 that an unknown malicious cyber actor is spoofing the SBA’s loan relief webpage through phishing emails. The email has been sent to various Federal Civilian Executive Branch, state, local, tribal and territorial government recipients. The email urges recipients to click on a hyperlink to address an SBA application. Complete information, including screenshots of the fake website and its IP address, as well as mitigation best practices for system owners and administrators, can be found on the alert website.

PPP Loan Forgiveness Application Portal Opened
On Aug. 10, the SBA opened its PPP loan forgiveness application portal to allow lenders to begin submitting loan forgiveness applications, supporting documents, and requests for forgiveness payments. To address borrower and lender questions concerning forgiveness of PPP loans in the forgiveness process, on Aug. 4 the SBA issued Frequently Asked Questions on PPP Loan Forgiveness. SBA clarifies that borrowers and lenders may rely on the guidance as SBA’s interpretation of the The CARES Act (in consultation with the Treasury Department), as amended by the PPP Flexibility Act and the PPP Interim Final Rules.

The PPP closed to applications on Aug. 8 as directed by current law. Congress is considering several proposals for a revived PPP, including additional funding and second-draw loans for the hardest hit small businesses. The FAQs on PPP Loan Forgiveness can be found here. For information on SBA’s Procedures for Lender Submission of PPP Loan Forgiveness Decisions to SBA and SBA Forgiveness Loan Reviews, see Procedural Notice No. 5000-20038. For more information and updates, visit or

NCUA Issues Risk Alert on COVID-19 Fraud Schemes
The National Credit Union Administration (NCUA) Board has issued an alert to inform credit unions about the risk of fraud associated with the COVID-19 pandemic. Those committing fraud often attempt to take advantage of opportunities made possible through new or expanded large government programs arising from emergency situations, such as The CARES Act.

The CARES Act provides many ways for financial institutions to work with members impacted by the pandemic. This latest alert describes increased risks associated with routine operations, outlines red flags associated with common fraud schemes in major CARES Act programs, provides references and avenues to report fraud or misconduct to the most appropriate authorities, and also provides member education resources.

GSEs Announce COVID-19 Refinance Fee
Refinance mortgage loans sold to Fannie Mae and Freddie Mac after Sept. 1 will include a new “adverse market” refinance fee of 0.5 percent, the two government sponsored enterprises (GSEs) announced on Wednesday night. This fee will be assessed for most no-cash-out refinances and cash-out refinances. It could cost a typical consumer $1,400.

Fannie and Freddie said the new fee is meant to mitigate their risk in light of the economic fallout from the COVID-19 pandemic. They requested the changes based on their projected pandemic-related losses going forward.

Joint Statement: Enforcement of BSA/Anti-Money Laundering Requirements
The federal banking agencies have issued a joint statement updating their existing enforcement guidance to enhance transparency regarding how they evaluate enforcement actions that are required by statute when financial institutions fail to meet Bank Secrecy Act/anti-money laundering (BSA/AML) obligations. You can read more here on the NCUA’s news page.
CFPB Issues Amendments to Payday, Vehicle Title, and Certain High-Cost Installment Loans Rule
On July 22, the Consumer Financial Protection Bureau issued a final rule amending parts of the Payday, Vehicle Title, and Certain High-Cost Installment Loans Rule, 12 CFR Part 1041 (CFPB Payday Rule). Though the CFPB Payday Rule became effective on Jan. 16, the compliance dates are currently stayed pursuant to a court order issued because of pending litigation. As a result, lenders are not obliged to comply with the rule until the court-ordered stay is lifted. You can read more here to see what the final rule rescinds and other details.

COVID-19 FHLB Matching Funds: Nonprofits and Small Businesses
In May, the Federal Home Loan Bank of San Francisco made $1.8 million in matching funds available to FHLB member financial institutions donating to nonprofits or contributing to local small businesses in response to the escalating economic impact of the COVID-19 pandemic on the communities they serve.

The FHLB will match donations that FHLB members make to organizations providing direct relief to affected members of their community, such as rent or food assistance, wage support, or childcare. The FHLB will also match grants that members make to keep struggling small businesses going. On June 22, the FHLB increased the matching fund per FHLB member limit from $5,000 to $10,000. The additional funding can also support members partnering with organizations that are engaged in proactive, sustained, and targeted efforts that help address racial economic inequality.

FHLB members can access the match funding through the end of the year. Click here and here for additional information.

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