A bank has a large mortgage department as well as a high HMDA error rate. An expensive software program could automate the process, but the business unit manager does not want to purchase the software because of its expense. Though it is not as efficient, the manager prefers to make some improvements to the manual process, add some more robust monitoring procedures, and opt not to purchase the software. What should the compliance professional do?

Question

Quizplus · Accepted Answer

As the compliance professional, it is important to document the risks and concerns associated with the high HMDA error rate, but ultimately it is up to the business unit manager to decide how to address the issue. If the manager determines that purchasing the expensive software is not feasible, it is still important to ensure that the manual process is enhanced and monitored effectively to mitigate any potential regulatory risks. The best course of action is to document the decision and the level of risk present with the manual systems to provide a record of the business unit manager's decision.

A Bank Has a Large Mortgage Department as Well as a High