Protiviti Offers Fair Lending Consulting Services and New Statistical Analytics Tool to Aid Lenders with Compliance

Heightened focus on Fair Lending risk makes compliance challenging assignment for financial institutions of all sizes

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May 13, 2010, 01:00 ET

MENLO PARK, Calif., May 13 /PRNewswire/ -- Protiviti, a global business consulting and internal audit firm, has combined its risk analytics tool and regulatory compliance expertise to provide support for lenders throughout the Fair Lending compliance process – from data gathering and analysis to building and executing a fair lending compliance program and strategy. Protiviti's Fair Lending Analytics and Governance services guide financial institutions through the nuances of compliance, helping them identify and address potential issues before they become major problems.

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Historically, Fair Lending was primarily a technical compliance exercise for all but the largest mortgage lenders. Now, however, lenders of all sizes and in all product categories are subject to aggressive enforcement of Fair Lending regulations that require more data, deeper analyses, and stricter compliance practices than they've ever faced.

"Lenders are uncertain of what supervisory agencies expect in fair lending compliance today," said Carol Beaumier, executive vice president, Protiviti. "Smaller lenders have seen the bar raised significantly in terms of the types of risk assessments and statistical analyses they're expected to perform. Larger institutions, which have well-established compliance programs in place for their real estate lending lines of business, face significant challenges in expanding existing controls to cover other product types for which less data exists to perform meaningful analyses. We offer unique solutions to help lenders adeptly address these issues and implement effective compliance programs."

"Particularly in light of the ongoing crises in the mortgage and housing markets, it's more critical than ever for lenders to ensure they can serve all creditworthy borrowers in a fair and responsible manner," said Marc Morial, president and CEO of the National Urban league and member of the Protiviti Advisory Board. "This is much more than a regulatory compliance matter – it's a matter of significant importance to our communities across the country."

Based on its experience working with lenders of all types and sizes, Protiviti recommends that compliance professionals focus on the following four considerations related to Fair Lending:

Establish detailed Fair Lending risk assessment processes, and effectively use the results of the risk assessment to drive their institutions' fair lending programs
Ensure all lending products and process stages are addressed within the fair lending program
Build robust monitoring and testing programs, including data analytics, and ensure personnel with the right skill sets to interpret monitoring and testing results are engaged in the process
Ensure all Fair Lending program components are reviewed regularly to account for changes in the institution's business model, new regulatory requirements and expectations, and other risks.

Tapping its data analytics and risk modeling expertise, Protiviti's professionals can design, build and support the implementation of risk assessment frameworks; implement or enhance fair lending monitoring and testing programs; and use its proprietary statistical monitoring tools, customized to each institution's needs, to detect and investigate significant trends or patterns in an institution's lending data. The firm's regulatory experts also work with institutions to create and provide Fair Lending training and awareness materials; conduct or provide subject-matter specialist support for fair lending audits; and help develop, implement and manage comprehensive plans to respond to and resolve fair lending-related enforcement actions.

"In light of the ongoing pressure to produce earnings and the focus on safety and soundness, this is a particularly difficult time for many lenders to make significant new investments in compliance controls," said Michael Brauneis, a director in Protiviti's regulatory practice. "Nevertheless, recent enforcement actions make clear that the cost of non-compliance can be far higher than maintaining an effective program in the first instance. We offer practical ideas to address key risks and implement effective controls while eliminating inefficient processes and minimizing costs."

Lending institutions are obligated to ensure that their "fair lending" practices prevent potential discrimination based on customers' protected class status (e.g. race, gender, age, etc.). To learn more about Fair Lending, listen to Protiviti's podcast "Fair Lending Requirements – Dealing with Heightened Regulatory Expectations," part of the firm's Powerful Insights (http://www.protiviti.com/en-US/Insights/Podcasts/Pages/default.aspx) series.

About Protiviti

Protiviti is a global business consulting and internal audit firm composed of experts specializing in risk, advisory and transaction services. The firm helps solve problems in finance and transactions, operations, technology, litigation, governance, risk, and compliance. Protiviti's highly trained, results-oriented professionals provide a unique perspective on a wide range of critical business issues for clients in the Americas, Asia-Pacific, Europe and the Middle East.

Protiviti has more than 60 locations worldwide and is a wholly owned subsidiary of Robert Half International Inc. (NYSE: RHI). Founded in 1948, Robert Half International is a member of the S&P 500 index.

Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services.

SOURCE Protiviti