OCC Finds Violations at Urban Trust Bank
In an agreement published last week, the Office of the Comptroller of the Currency finds that there are violations in business practices at Urban Trust Bank.
The agreement contends that several aspects of banking practices at Urban Trust were neither safe nor sound.
The problems run across several aspects of how Urban Trust operates. According to the OCC, Urban Trust needs to shore up its vendor management. Going forward, 
Urban Trust has to put together a business plan (to be approved by the OCC) that will address their concerns over the bank’s products and services. The agreement reads:
“The Comptroller has found violations of law and regulations and unsafe and unsound banking practices relating to vendor management practices and failure to implement an approved business plan, specifically concerning existing and new products and services.”
The OCC says that it wants to protect deposits place in the bank. That is a somewhat mystifying point, as Urban Trust’s regulatory capital ratios are fairly strong. Their tier-one leverage ratio is 13.7 percent and their tier one risked-based capital ratio is 18.7 percent. Both of those scores exceed the definition of well-capitalized by a wide margin. The exception to this level of health could be with respect to their loan-loss reserves, which amount to just 2.96 percent of outstanding loans. Given that Urban Trust is located in Florida, those numbers could be too optimistic.
In my opinion, that would seem to say that the real motivation for this letter is elsewhere – and most likely in the area of their prepaid cards. The FDIC’s interaction with Republic Bank had the same contradiction. Even though Republic had good capital ratios, they had a refund anticipation loan product that worried the FDIC. The FDIC said that both were of concern, even though the grounds was far greater with the product.
Left unsaid are the specific remedies required for the bank’s prepaid debit cards.
Urban Trust still offers an optional overdraft product on Check$mart-branded cards in Ohio and Arizona. Urban Trust levies a penalty fee of 15 percent of the overage, up to a maximum of $36.
The wording “existing and new products and services” would seem to portend that there are new plans at Urban Trust which have not yet been released to the public. What products and services? Was Urban Trust contemplating a new iteration of credit? Could Urban Trust have been interested in a refund anticipation loan product?
David A Lee Sr
November 28, 2012
I wish I had found this information sooner. UTB has started a program of prepaid visa / master charge cards, with CheckSmart here in Indiana. CheckSmart claims that this program replaces the previous card (NETSPEND) as thier preferred loadable prepaid card. However, they don’t tell you that the disgraceful management and lack of over-sight causes the consumer an enormance burden; both financially and credaciously. One example was where CheckSmart opened a new account and entered data incorrectly. This directly affected not only the account of the prepaid card but also to the monies being deposited from another account. Lost money, fees and penalties have resulted. Other complaints spread out over daily business practices. Thier representatives are inadequately trained nor prepared for the execution of daily business. Often, left with reading parameters from prepared booklets with little to no understanding by the representative themselves. The UTB (Urban Trust Bank) is more than willing to take financial gains, however, try and get what is rightfully youurs back from the bank and you set upon and strategical trip of deceit and lies. The UTB, has found itself a way to pull in innocent victums so to help themselves (UTB) with cashflow management troubles that the ICC and other federal agencies are questioning. It’s the old marble in the shell game. And only UTB is a winner. The people that the bank claims to be asissting are in fact, the very ones being taken advantage of. I suggest that the program be shut down immediately and a full detailed investigation into bank practices and sources from which the bank actually recieves its’ source of revenue be inacted. The program mentioned seems to be run from Birmingham, Alabama. The officers and employees may or may not be illegal aliens which the bank officials utilize and sacrafice as the whim of the upper eschellion manadates.
This is a malicious and unnecessary nuisance upon the people and totally unaccessable for banking practices throughout the united states of america.