Regions Bank of Birmingham, Ala., was assessed a $2.95 million civil money penalty this month over unsafe and unsound practices in its flood insurance program, according to a consent order released Tuesday by the Federal Reserve Board.
The Aug. 14 order pointed to a “pattern or practice” of violations by Regions Bank of the Fed’s Regulation H, which implements the National Flood Insurance Act. It said the bank also committed additional violations over more than about a year as a result of changes in loan servicing platforms and third-party service providers. During that period, the order states, Regions “did not effectively monitor a significant number of home equity loans and home equity lines of credit subject to the Flood Act for compliance with Regulation H.”
The Fed said that Regions did, after discovering that certain home equity loans and home equity lines of credit were not being properly monitored for Reg H compliance, addressed the failure and enhanced its flood compliance program by 2017.
Regions was required to pay $58,000 of the $2.95 million assessed directly to the National Flood Insurance Program, the order shows.