Question: What do the most recent amendments to Regulation CC mean for banks in 2010?
Answer:
The recent amendments to Reg CC, also known as the Expedited Funds Availability Act, are bringing about significant changes for all banks in 2010. Effective February 27, 2010, all paper check processing performed at the Federal Reserve Bank of Atlanta will move to the Federal Reserve Bank of Cleveland, making Cleveland the only paper check-processing region in the nation. The move to a single paper check-processing region means that there will no longer be any non-local checks as the term is used in Reg CC. Additionally, the changes in funds availability policies for virtually all financial institutions are affected and will require most institutions to take the following steps:
Review and update their funds availability policies, including:
Delayed funds availability. Immediate, same day, or next day funds availability. Any other necessary changes.
Immediate, same day, or next day funds availability. Any other necessary changes.
Send change notices.
Update lobby posters.
If a bank has a delayed funds availability policy, because all non-priority checks will be treated as local checks, it can no longer state in its funds availability policy that a non-local check will be delayed five days. The longest standard delay that can be used will be the two-day availability period that was previously permitted for local checks. Thus, if an institution has a delayed funds availability policy, it will need to update its funds availability disclosure accordingly. In order to remain up-to-date and aware of the latest information and changes that may occur within Reg CC and be fully capable of answering customer questions and concerns, it is vital for the bank to initiate a comprehensive training program from a noteworthy provider for all employees.
The Edcomm Group
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