Open Recommendations

EXIM's Office of Board Authorized Finance should develop and implement a policy to address changes in exposure fees following Board approval, including in co-financing transactions.

EXIM's Office of Board Authorized Finance should define the approval responsibility for changes in exposure fees.

EXIM's Office of Board Authorized Finance in coordination with Office of General Counsel should develop and implement guidelines or a checklist requiring management to verify that appropriate legal and policy guidance is in place prior to initiating direct loan transactions.

EXIM's Office of Board Authorized Finance should update procedures and checklists to ensure the SAM debt offset check is completed and reviewed by management prior to loan authorization.

Distribute the 658 PII losses in Sampling Frame 1 to the appropriate component(s) for review to determine whether any losses are moderate, high, or major and, if so, identify and take the proper actions to mitigate those losses.

To prevent future employee errors related to reporting, assessing, and closing PII losses, evaluate the effectiveness of the processes and controls implemented by the Office of Privacy and Disclosure and implement changes as needed.

Update the Breach Response Plan to clearly explain all actions relevant to OIG referrals, such as when managers should use forms related to lost or stolen equipment.

Take appropriate action for the 80 records we identified.

Identify the factors contributing to employee errors during this process and implement appropriate corrective actions.

FHFA's DBR should assess the extent to which FHLBanks are relying on redacted ROEs when reviewing membership applications or performing ongoing monitoring.

FHFA's DBR should clarify and reinforce DBR’s expectation to the FHLBanks that they should request and receive from federal and state regulators ROEs that are not substantively redacted, and that other relevant supervisory reports should be collected when necessary.

FHFA's DBR should conduct outreach to federal financial regulators to reinforce the need for compliance with 12 U.S.C. § 1442(a)(1), which requires their production of reports, records, and information relating to the condition of any member of any FHLBank upon request by an FHLBank. As part of this outreach, make clear that such materials extend beyond ROEs, and that materials produced in response to an FHLBank requests should be provided without substantive redactions.

FHFA's DBR should assess the extent to which restrictions on access to state-issued ROEs may hinder the FHLBanks in making fully informed decisions when evaluating applications for membership and when making determinations to limit or deny member requests for advances in accordance with applicable FHFA regulations.

FHFA's DBR should, if applicable, continue to pursue outreach with the Conference of State Bank Supervisors and state regulators to assist FHLBanks in accessing state-issued ROEs.

FHFA's DBR should complete its assessment of the extent of weaknesses in the FHLBanks’ enforcement of members’ material adverse change notification requirements, and provide guidance to FHLBanks on best practices, such as issuing periodic reminders of notification requirements, to help ensure members’ compliance with the FHLBanks’ contractual requirements.

Establish a process to periodically update training with the correct information and links to reports, systems, and tools.

Create a plan to provide recurring refresher training regarding managing workloads for all management staff, including field and regional offices.

Update written training materials with standardized steps and/or checklists for management to follow to ensure they are properly managing workloads and using the correct reports, systems, and tools.

Create one consolidated resource, which includes reports, trainings, systems, and tools, for information used to manage workloads.

Update systems and tools to reflect workload and software/application version changes and improve their compatibility with other systems and tools.

Verify that Tomorrow Youth Organization corrects the instance of material noncompliance detailed on page 18 of the audit report.

Establish and implement a comprehensive case management system to track cases from intake through adjudication.

Provide system training to all IOs and Maritime Center staff who access S&R information.

Create standard operating procedures for IOs and Maritime Center staff to ensure all ALJ decisions are accurately reflected in MMLD.

Create a policy governing the process IOs must follow when deciding to not pursue a preliminary case, to include the requirement to document justification for the decision in the case file.