Section 1071: Policies vs. Procedures & the Board

When it comes to your Section 1071 planning and implementation efforts, you want to be careful that you don’t bog down your Board with too much information. While they certainly need to know what 1071 is, what it will require and the ultimate impact on the financial institution, they don’t really need all the nitty gritty details as to “how” it will all be carried out. In reality, the Board only needs a 10,000-foot view, enough to ensure the ship is on the right course, so to speak. This is why we advise our clients to keep any policies “lean and mean”. Written procedures, to ensure everyone is on the same page, are best nailed down by management. Just as your Board members don’t need to know how to fill out a Currency Transaction Report, they don’t need to know “how” to collect demographic information for 1071 purposes.

It is important to remember that, while there is no requirement to have a written, Board-approved policy for the 1071 requirements, you may want to tweak other policies you might have related to fair lending, such as a fair lending policy, compliance policy, etc.

Jerod explains more in the video.

1071 Resources!



Jerod Moyer

Jerod is the leader of Banker’s Compliance Consulting’s training productions. He is a nationally recognized speaker. Whether it’s a conference, seminar, school, webinar or luncheon, it’s easy to stay engaged when he presents due to the amount of passion and energy he brings to each and every compliance topic. Jerod has spoken on behalf of the American Bankers’ Association, BankersOnline, many state banking associations, private compliance groups and financial institutions. He is a Certified Regulatory Compliance Manager (CRCM) and BankersOnline Guru. Jerod likes to spend his time (between reading regulations and producing compliance training!) relaxing at the lake with his wife and three children, following their activities or engaged in something sports-related!

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Section 1071: Policies vs. Procedures & the Board