WASHINGTON–A new report from the Office of the Inspector General at the FDIC has found two of four key data elements in its system that supports its supervision and insurance responsibilities to be “unreliable.”
The OIG said the system is supposed to be error-free.
According to the FDIC’s OIG report, errors in the “completion date” and “mail date” data elements were found, essentially “blocking the agency from reaching its goal of 100% accuracy for the key data elements.” The OIG reported finding completion date errors for 14 banks and mail date errors for 12 banks.
No errors were found in the other two data elements tested, examination ratings and start dates, the OIG said.
According to the OIG analysis, the unreliable data is the result of weaknesses in the FDIC’s procedures and practices for identifying and ensuring the quality of the key data elements it examined. All of the data elements examined were contained in the agency’s Virtual Supervisory Information on the Net (ViSION) system. According to the bank regulatory agency, ViSION has designated as “essential to its mission,” and uses 19 key data elements collected in the FDIC exam process that the agency requires to be 100% accurate, according to the OIG report.
The system is used by the 3,200 users at the FDIC and 900 more users at the Federal Reserve and state bank supervisors, the report states.
‘Weaknesses in Procedures’
“We determined that the unreliable data resulted from weaknesses in the FDIC’s procedures and practices for identifying and ensuring the quality of the Completion Date and Mail Date key data elements in the ViSION system,” the report reads. “In particular, the FDIC did not develop and implement standard guidance for identifying and supporting Completion Dates for State-led examinations and for identifying the documentation that should be used and retained to support the Mail Date data element. Further, FDIC review procedures did not consistently detect or correct errors in a timely manner.”
In addition, the OIG further stated it found the risk-based assessment section of the ViSION data to be “undocumented and outdated,” and further found the FDIC has not updated the assessment and related guidance in 12 years.
Six Recommendations
The report makes six recommendations, including three that the agency develop and use standard guidance for completion and mail dates in the system, conduct training on the guidance, and revise quality assurance procedures.
“In addition, we recommend that the FDIC research, and correct additional entries we found in the ViSION system that may have errors related to the Completion Date,” the report advises. “We also recommend that the FDIC conduct a risk assessment to identify key supervisory information in the ViSION system based on the current operating environment and reporting requirements, and update the data reliability guidance for the ViSION system based on the results of the risk assessment.”