CUNA CompBlog: What Is the Consumer Compliance Rating System?
By: Nancy DeGrandi

The Consumer Compliance Rating System (CCRS) is an interagency framework developed by FFIEC member agencies for evaluating an institution's ability to manage consumer compliance risk and to prevent harm to consumers. NCUA integrates the current rating system into its existing CAMEL structure.

In November 2016, the FFIEC agencies finalized changes to the current 36 year-old rating system to bring it more in line with existing consumer compliance approaches and the examination focus toward risk. The revisions to FFIEC's existing guidance have an effective date of March 31, 2017. 

Essentially, the CCRS is a supervisory policy for evaluating a financial institution's adherence to consumer compliance requirements. It emphasizes the importance of an institution's compliance management system (CMS). Particularly the institution's compliance risk management practices that are in place to manage consumer compliance risk, support compliance, and prevent consumer harm.  

Why should credit unions care? Under the new system NCUA examiners will assess a credit union's ability to effectively manage its compliance risk. A credit union is expected to proactively prevent, self-identify, and should self-correct compliance issues. A credit union's ability to do so will be reflected in the "Management" component rating and the overall CAMEL rating used by NCUA.

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