OCC Stresses Third-Party Risk Management in Military Banking

In remarks at the Association of Military Bankers’ annual workshop today, OCC Senior Deputy Comptroller Grovetta Gardineer stressed the importance of ensuring that all military service members and their families receive the consumer protections they are entitled to under the Servicemembers Civil Relief Act. While there has been a significant reduction in SCRA compliance issues since the agency made it a point of regulatory focus, she said, there are still remaining challenges in certain areas, such as collections.

Gardineer reminded bankers of the importance of due diligence with third party vendors that deliver products and services to servicemembers on behalf of the institution. “At the end of the day, banks are responsible and will be held accountable for failures and abuse in the products and services they offer – even those delivered by third-party vendors,” she cautioned. She added that banks have room to improve their processes for identifying military borrowers that are eligible for expanded protections, particularly as more financial products and services begin to fall under the scope of the Military Lending Act in October.

The AMBA annual workshop brings government officials, federal regulators, banking trades and other stakeholders together each year to discuss the latest banking issues affecting servicemembers. ABA President and CEO Rob Nichols will deliver a Washington update to attendees during tomorrow’s session.