Compliance Management Systems 101

CFPB, DOJ, FTC, state AGs. Trying to keep these regulators straight can be maddening. However, they all have one thing in common: they are increasing scrutiny on lending practices and stepping up enforcement when violations are uncovered.

The Fair Lending Jungle

Most likely, you’re already doing the right things when it comes to your lending practices. So how do you demonstrate this and keep yourself out of the regulatory quicksand?

Regulatory pressure is nothing new, but with the added scrutiny of these regulatory agencies, it’s important for you to take the necessary steps to ensure your organization fills any compliance gaps that may raise red flags. The best way to plug your compliance holes and meet the expectations of all the agencies concerned with fair lending practices is to fully embrace the CFPB’s guidance and put in place a CMS.

On Demand Webinar

CFPB Watch:
How to Keep from Being a Headline

Join us to discuss CFPB & Fair Lending regulatory trends across the financial services industry, and what you can do today to keep your company out of the regulatory crosshairs. 

What is a Compliance Management System?

Quite simply it’s a comprehensive compliance program. A CMS is an integrated system comprised of written documents, functions,
processes, controls, and tools that help an organization comply with legal requirements and minimize harm to consumers due to violations of law. A CMS is woven into every functional area in your organization, from sales to advertising to operations and administration.

Regulators, and specifically the CFPB, expect every entity to have
an effective CMS adapted to its business strategy and operations.
Under its guidelines, a CMS contains 4 areas of focus:

  1. Board of Director Oversight
  2. Compliance Program
  3. Consumer Complaint Response
  4. Audit

A good CMS can proactively address the risks relevant to your
organization while meeting multiple regulatory requirements.

Cheat Sheet

CMS Cheat Sheet

Learn the 4 key areas an effective CMS contains. And learn how it can proactively address risks while meeting regulatory requirements.


Fair Lending Checklist

See how well your organization embraces a CMS’s 4 areas of focus and if you can dodge the regulatory pitfalls.

1.    Board of Directors & Management Oversight

Your Board of Directors and senior management should take an
active role in your compliance efforts. This sets the tone at the top and defines compliance expectations for the company as well as its service providers. If management cares about compliance, everybody else will (or at least should) care about it too.

By setting this example, leadership should appoint a compliance champion, an individual dedicated to overseeing the compliance mandates the board establishes. Senior management should also create the compliance structure into which operational policies, procedures and standards are placed. They must also proactively allocate resources to compliance, as well as review periodic reports and recommend course correction on compliance matters.

How Compli Helps:

Make oversight easy for your Board and management team by automating your compliance program initiatives, engaging workforce communication and producing regulatory reporting.

On Demand Webinar

Board of Directors Oversight

Join us to discuss the critical role your Board of Directors and Management play within your Compliance Management System. Learn the requirements for high-level executives as well as best practices for communication within your organization. 

2.    Developing a Compliance Program

Your compliance program is the nuts and bolts of a CMS – where the heavy lifting occurs and the easiest place for things to fall through the cracks. Administered by the compliance champion, the program includes approved written policies and procedures, training, monitoring and corrective action. It should give accurate information to help make informed decisions about the organization’s ongoing compliance posture and activities.

How Compli Helps:

Automating all of your workforce and compliance activities, communications, trainings and business processes in Compli ensures consistency and peace of mind.

Everything you needed to know about compliance programs but were afraid to ask

Compliance Program Topic Center

3.    Consumer Complaint Response

Even the best businesses receive customer complaints. From a
compliance perspective, complaints give valuable insight into potential issues. As such, they draw the attention of regulators. A consumer complaint management program is the third element of a CMS. It helps log, track, investigate and resolve complaints in a timely manner. The compliance champion should analyze complaint data to identify and understand underlying issues and business risks.

Contrary to original thought, you don’t have to monitor every possible source of complaint (Facebook, Twitter…etc). Complaint management has become business critical and organizations need to properly protect themselves. 

How Compli Helps:

Compligo allows your company to not only track individual consumer complaints, but also to identify trends and high risk areas before they affect your reputation and your bottom line. Think of it as an early warning system that alerts you to issues well before they impact your business.

Deep dive into the world of consumer complaints

Consumer Complaint Topic Center

4.    Compliance Audit

The CFPB recommends an objective audit of a company’s operations to ensure compliance with legal requirements, as well as internal policies and procedures. The word “audit” may sound scary, but it isn’t. Your organization’s personnel may conduct an audit; however, they must be independent to the functions being audited. This provides objectivity and eliminates conflicting self-interest.

The audit function can start small and build over time. Start by
manually examining a random sample of 10 or 20 transactions each month to make sure all internal processes are being followed and the paperwork is complete. If it’s not complete or a problem is discovered, it may be time to teach or retrain employees. A CMS can streamline the audit process and provide ongoing assurance and validation that obligations are being met.

How Compli Helps:

Compli’s compliance intelligence provides detailed activity insight by analyzing all initiatives and regulatory data using centralized reporting. These reports help you proactively spot issues and provide proof to auditors and regulators that your compliance programs is operational and effective.

On Demand Webinar

CFPB Compliance Audit

When you have employees and managers inspecting their own work, they can either miss or hide the truth.  The key is an independent, objective audit. Join us in the on-demand webinar to learn how a Compliance Audit fits in as part of the CMS within the CFPB guidelines.

Fair Lending Compliance Resources

Here are our most recent tools to keep you cool, calm and compliant.

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