Compliance White Paper Says Keep Policies Clear
Incomplete, vague compliance policies are a path to nowhere good. Explicit, clear policies are “life preservers.” In two sentences that is the gist of a new white paper from PolicyWorks, an Iowa-based consulting CUSO focused on credit unions and their compliance issues.
The white paper – titled “In Turbulent Times, Credit Union Policies Are Life Preservers” – is available as a free download.
Central to the PolicyWorks argument is that today’s times are “rocky” and that the way to stay on course – and dodge trouble from regulators and examiners – is to have clear policies that are consistently followed.
Said the report: “Insufficient or outdated [compliance] policies are among the most apparent of red flags for examiners.”
The report continued: “While the current regulatory environment is partly to blame, there are several additional factors that prevent credit unions from giving policies the full attention they deserve. A lack of resources, a comfort with the status quo and even a strong trust in the employees of a credit union all serve as roadblocks to a sound policies and procedures strategy.”
In some detail, the report goes – step by step – through sample reviews designed to illustrate adequate (and also inadequate) compliance policies. The document also looks at the role of the board of directors in ensuring there are adequate safeguards in place.
The document concluded with this stern warning: “Examiners operate under the premise that credit unions have no excuse for lacking knowledge of the current rules and regulations. For this reason, they expect all policies and procedures to exist and to be reflective of current practices. Don’t wait to be told your credit union is a missing a policy – unless, of course, you enjoy frequent visits from your friendly examiner.”