United States

OCC updates policies regarding violations of laws and regulations


The OCC released Bulletin 2017-18 on May 23, 2017, updating its policies and procedures that support the agency’s mission of ensuring safe and sound federal banking. These updates are effective July 1, 2017, and are geared to provide the agency with guidelines related to consistent terminology, communication, format, follow-up, analysis, documentation and reporting of violations. The updated policies and procedures apply to examinations of all national banks, federal savings associations, and federal branches and agencies.  

The OCC’s guidance highlighted the most important principles in implementing the mission for safe and sound banking operations. These highlights included ensuring consistency across all processes and procedures for all OCC lines of business; creating a consistent format for communicating violations, which will include a legal citation, description, summary of relevant requirements, facts supporting the violation and root causes, corrective action and board and management’s commitment to the corrective action. The OCC’s updates also include reinforcing the importance of timely and thorough follow-up and tracking corrective actions and milestones to those actions.

The OCC also emphasized the need for examiners to communicate all OCC-identified violations to facilitate timely and effective corrective action by the board and management. This update includes the differences of how the examiners must communicate substantive and less substantive violations.

These updates are now reflected in the “Bank Supervision Process,” “Community Bank Supervision,” “Federal Branches and Agencies,” and “Large Bank Supervision” booklets.