Penalties will be more expensive in 2020 under inflation-adjusted schedules

Higher maximum amounts for civil money penalties (CMP), adjusted for inflation, will be in place after Jan. 15 by four federal financial institution regulators, the agencies said in separate notices to be published as early Tuesday.

The separate notices, filed Monday, by the Consumer Financial Protection Bureau (CFPB), Federal Deposit Insurance Corp. (FDIC), Federal Reserve Board, and National Credit Union Administration (NCUA), generally apply to separate provisions under each agency’s rules. The increased amounts will apply to penalties applied toward conduct occurring on or after Nov. 5, 2015.

Under the schedules published by each agency, the CFPB administers 11 CMPs, the FDIC 49, the Fed 49, and the NCUA 16. The highest CMP that may be charged by any is just under $2.05 million – up from $2.01 million in 2019.

Under federal law (the Federal Civil Penalties Inflation Adjustment Improvements Act of 1990, as amended), federal agencies must make annual adjustments to the maximum amount of each CMP the agency administers. The agencies use a multiplier provided by the White House Office of Management and Budget (OMB) to make the changes to their various CMPs. In December, the OMB released a multiplier of 1.01764 to be used to adjust each agency’s CMPs for inflation.

The OCC announced its penalty adjustments two weeks ago.

CFPB Civil Monetary Penalty Inflation Adjustment

FDIC Civil Monetary Penalty Inflation Adjustment

Federal Reserve Board Civil Money Penalty Inflation Adjustment

NCUA Civil Monetary Penalty Inflation Adjustment

RR: OCC civil money penalty maximums up 1.764% for 2020 (Jan. 2, 2020)

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