HSBC USA INC. HSBC BANK USA, N.A. CHARTER OF THE COMPLIANCE COMMITTEE

Transcription

1 HSBC USA INC. HSBC BANK USA, N.A. CHARTER OF THE COMPLIANCE COMMITTEE I. Cmmittee Purpse The Cmpliance Cmmittee (the Cmmittee ) is appinted by the Bards f Directrs f HSBC USA Inc. (the Crpratin ) and HSBC Bank USA, N.A. ( HSBC Bank USA ), and is respnsible, n behalf f the Bard, t: 1) mnitr and crdinate HSBC Bank USA s adherence t the prvisins f the Cnsent Order (the OCC AML Order ) issued by the Office f the Cmptrller f the Currency ( OCC ) dated Octber 6, 2010, and t versee HSBC Bank USA s effrts t achieve and maintain an effective Bank Secrecy Act ( BSA )/Anti-Mney Laundering ( AML ) cmpliance prgram; 2) mnitr and crdinate the crrective actins in the lan servicing, freclsure prcessing and lss mitigatin functins f HSBC Bank USA and t ensure that HSBC Bank USA cmplies with the Cnsent Order entered with the OCC dated April 13, 2011, as amended n February 28, 2013 (the OCC Freclsure Order ); and 3) mnitr and crdinate HSBC Bank USA s adherence t the prvisins f the Cnsent Order (the OCC Enterprise-Wide Cmpliance Order ) issued by the OCC dated December 11, 2012 and t versee HSBC Bank USA s effrts t achieve and maintain an effective enterprise-wide cmpliance prgram. II. Cmmittee Cmpsitin and Meetings The Cmmittee shall cnsist f nt less than three Directrs a majrity f which shall be independent, nn-executive directrs wh are nt als emplyees r fficers f the Crpratin r HSBC Bank USA, r any principal sharehlder f the Crpratin. The Cmmittee shall meet with such frequency as it may cnsider apprpriate, but in any event nt less than mnthly, and shall meet at least quarterly with the Chief Risk Officer, Head f Regulatry Cmpliance and Head f Financial Crime Cmpliance - BSA/AML Directr in Executive Sessin. Each year, a schedule f matters t be cnsidered by the Cmmittee at its scheduled meetings will be presented t the Cmmittee and may be amended frm time t time t ensure Cmmittee Cmpliance with this Charter. The Secretary f the Cmmittee shall prduce materials and minutes f all meetings and the Cmmittee shall make regular reprts t the Bard n all its activities since its last reprt. The Cmmittee shall als prvide infrmatin believed t be pertinent t the perfrmance f respnsibilities f ther cmmittees f the Bard t thse cmmittees as apprpriate. 1

2 III. Cmmittee Respnsibilities The Cmmittee shall have the fllwing respnsibilities, pwers, directin and authrities: Regulatry Orders 1) T review written prgress reprts detailing the frm and manner f all actins taken t secure cmpliance with: (a) a) the OCC AML Order, including a timetable and schedule t implement specific remedial actins t be taken t address the recmmendatins in an independent cnsultant's BSA/AML Reprt, and the results theref; b) the OCC Freclsure Order, including a timetable and schedule t implement specific remedial actins t be taken t address the weaknesses identified in a cmpliance prgram plan regarding residential lan servicing, lss mitigatin and freclsure prcesses, and the results theref, and c) the OCC Enterprise-Wide Cmpliance Order, including a timetable and schedule t implement specific remedial actins t be taken t address the weaknesses identified in the cmpliance prgram and the results and status f thse actins; such reprts t be submitted within 30 days after the end f each calendar quarter; and t instruct the Bard f Directrs f HSBC Bank USA t frward a cpy f each such reprt with any additinal cmments by the Bard f Directrs t the Deputy Cmptrller fr Large Bank Supervisin f the OCC and the Examiner-in-Charge within 10 days f receiving such reprts. 2) T make regular reprts t the Bards f Directrs n its activities and management s prgress relative t enhancement f the Cmpliance functin and, with respect t HSBC Bank USA, the crrective actins in HSBC Bank USA s Enterprise-Wide Cmpliance, BSA/AML and residential lan servicing, lss mitigatin and freclsure functins. 3) T ensure that the HSBC Bank USA and the Crpratin have sufficient financial and managerial resurces, prcesses, persnnel and cntrl systems t implement and adhere t the prvisins f the OCC Orders and t recmmend t the HSBC Bank USA and the Crpratin Bard f Directrs, such actin as the Cmmittee deems advisable, t fully utilize the financial and managerial resurces f HSBC Bank USA and the Crpratin, t serve as a surce f strength, including but nt limited t taking steps t ensure that HSBC Bank USA and the Crpratin cmply with the OCC Orders. 4) T receive regular reprts frm management cncerning all actin called fr by management r the Bard f Directrs f HSBC Bank USA in the OCC Orders, r thrugh any ther cmmunicatin frm the OCC, and cncerning all actin directed by the Bard f Directrs f HSBC Bank USA in cnnectin with the OCC Orders. The Cmmittee shall direct timely crrective actin fr any nn-cmpliance with actin called fr under the OCC Orders and as therwise directed by the Bard f Directrs f HSBC Bank USA with respect t the OCC Orders. 5) T receive regular reprts frm management and mnitr management's implementatin f needed enhancements as identified in management's plan t enhance its cmpliance prgram with respect t residential lan servicing, lss mitigatin and freclsure peratins. 2

3 6) T receive regular reprts frm management and mnitr management's assessment f HSBC Bank USA s risks with respect t its residential lan servicing, lss mitigatin, freclsure and dispsitin f real estate wned peratins, including peratinal, cmpliance, transactin, legal and reputatinal risks. 7) T receive regular reprts frm management and mnitr management's prgress with remediating issues identified in the review by an independent cnsultant f residential lan freclsure actins frm January 1, 2009 t December 31, ) T receive regular reprts frm management and mnitr management's prgress with strengthening crdinatin f HSBC Bank USA s servicing practices and cmmunicatins with brrwers related t lss mitigatin and freclsure. 9) T receive regular reprts frm management and mnitr management's prgress with ensuring apprpriate cntrls and versight f HSCB Bank USA s MERS activities and cmpliance. 10) T receive regular reprts frm management and mnitr management's prgress with enhancing management infrmatin systems supprting residential lan servicing, lss mitigatin and freclsure peratins. 11) T receive regular reprts frm management and mnitr management's prgress with gvernance f the utsurcing f any residential lan servicing, lss mitigatin, prperty management and freclsure functins. General Cmpliance Oversight 12) T versee, thrugh management reprts t the Cmmittee, the cntinuing maintenance and enhancement f a strng and sustainable cmpliance culture, including initiatives t instill a culture in which: there is strng emphasis n strict cmpliance with the spirit and letter f laws and regulatins, as well as lcal and Grup plicies and prcedures; respnsibility fr awareness and implementatin f effective versight and mnitring f cmpliance risk in business, functin and peratin is lcally understd and managed; regular and apprpriate cmpliance training f all staff is prvided; regular and apprpriate cmmunicatin regarding cmpliance standards; accuntability is expected and accepted; and Cmpliance prgrams that reflect best practices are develped and re-evaluated n a regular basis and implemented in the rdinary curse f business. 13) T perfrm any ther duties r respnsibilities expressly delegated t the Cmmittee by the Bards f Directrs frm time t time, and t cnsider and undertake such tasks r matters as the Chairman f any Bard f Directrs may request frm time t time. 14) T receive regular reprts frm the Chief Risk Officer, Head f Regulatry Cmpliance and/r Head f Financial Crime Cmpliance BSA/AML Directr including: 3

4 annually, present the Cmpliance Operating Plan, including key bjectives and resurce funding, t the Cmmittee fr review and apprval; annually, present the Cmpliance Mnitring and Testing Plan ( CMAT ) t the Cmmittee fr review and apprval; annually, present the Educatin Plan, including the training n BSA/AML and Office f Freign Assets Cntrl ( OFAC ) t the Cmmittee fr review and apprval; semi-annually, present the Crpratin's Cmpliance Prgram and an enterprise-wide BSA/AML Prgram fr the Cmmittee's review and apprval; quarterly, reprt n the state f the Cmpliance Department and prgress under the Cmpliance Operating Plan relative t established prgram bjectives; quarterly, prvide a reprt f key trends and significant events relating t suspicius activity mnitring, identificatin and reprting; frm time t time, based upn changes in law, regulatin, circumstances r experience, recmmend such changes t the verarching Cmpliance Prgram, including but nt limited t changes t the BSA/AML Prgram, Cmpliance Operating Plan, CMAT Plan, Educatin Plan, and ther regulatin-specific risk assessments and Cmpliance Plicies as the Chief Risk Officer, Head f Regulatry Cmpliance and/r Head f Financial Crime Cmpliance BSA/AML Directr deems apprpriate, and significant changes shall be presented t the Cmmittee fr endrsement; and frm time t time, reprt n cnfrmity f the Cmpliance Prgram t Grup plicies. 15) T apprve the appintment and replacement f the Head f Regulatry Cmpliance and/r Head f Financial Crime Cmpliance BSA/AML Directr and ther cmpliance fficers as the Cmmittee deems apprpriate. The Cmmittee shall review and apprve the annual key bjectives and perfrmance review f the Head f Regulatry Cmpliance and Head f Financial Crime Cmpliance BSA/AML Directr. The Chairman f the Cmmittee shall prvide input t the Chairman f the Risk Cmmittee n the annual key bjectives and perfrmance review f the Chief Risk Officer. 16) The Cmmittee will cnsider the adequacy f resurces, qualificatins and experience f senir management f the Cmpliance Department, its training prgrams, budget and successin planning fr key rles in the functin. 17) The Cmmittee will ensure HSBC Bank USA achieves and maintains an effective BSA/AML and enterprise-wide cmpliance prgram. 4

5 18) The Cmmittee shall seek such assurance as it may deem apprpriate that the Chief Risk Officer, Head f Regulatry Cmpliance and Head f Financial Crime Cmpliance BSA/AML Directr: (i) participate in the risk management and versight prcess at the highest level n an enterprise-wide basis; (ii) have ttal independence frm individual business units; (iii) reprt t the Cmmittee and have internal functinal reprting lines t the Managing Directr, Head f Grup Risk; Glbal Head f Financial Crime Cmpliance and/r Glbal Head f Regulatry Cmpliance; and (iv) have direct access t the Chairman f the Cmmittee in the event f need. 19) Upn request f the Bards f Directrs, the Cmmittee will prvide the Bards f Directrs with such assurances as it deems practicable with respect t the Crpratin s/ HSBC Bank USA s cmpliance with regulatry and legal requirements. 20) In its discretin, t retain special cunsel, advisrs, accunting experts, r ther cnsultants and t cnsider frm time t time any ther matters which the Cmmittee believes are required f it in keeping with its respnsibilities. In its discretin, the Cmmittee may btain such prfessinal external advice as it shall deem apprpriate t take accunt f relevant experience utside the Crpratin and HSBC Bank USA and challenge its analysis and assessment. Any such appintment shall be made thrugh the Secretary, wh shall be respnsible, n behalf f the Cmmittee, fr the cntractual arrangements and payment f fees by the Crpratin and HSBC Bank USA. Where the Cmmittee s mnitring and review activities reveal cause fr cncern r scpe fr imprvement, it shall make recmmendatins t the Bard f Directrs n actin needed t address the issue r t make imprvements. While the Cmpliance Cmmittee has the respnsibilities and pwers set frth in this Charter, it is nt the duty f the Cmpliance Cmmittee t plan r cnduct cmpliance assessments r reviews. This is the respnsibility f management, and particularly the Cmpliance functin. Nr is it the duty f the Cmpliance Cmmittee t cnduct investigatins r t therwise assure cmpliance with laws and regulatins r cdes f ethics that apply t the Crpratin and its subsidiaries. 04/29/2015 J:\CrpSec\US Bards\Gvernance dcs\husi HBUS Cmpliance Cmm Charter_042015_FINAL.dc 5