Warning--long, but thoughtful, post ahead!
Andy's on the mark with his suggestions--your comment letter doesn't have to be a polished legal brief, just solid facts. Rulewriters are charged with a balancing act: effect changes that will accomplish the goals of the law without creating undue burden for those who must comply. They will hear plenty from the intended beneficiaries of the law, so it's up to you to paint the dark side of the picture.
Comment quality matters. Rulewriters already know that you won't like additionalal expensive regulations, and they discount comments lacking substance. They asked for public comments because they don't understand the implications of their proposal. It's up to you to supply the details of costs and burdens that will result from the proposal.
All change is bad - at least from the cost perspective. Your bank will suffer the cost of implementing ALL new rules, even those you support. Tell the regulator the types of costs you will incur and your best estimates of amounts. Again, this isn't rocket science. Reasonable estimates are perfectly acceptable.
With few exceptions, new rules will create or increase costs in most of all of the categories listed below. Mention as many as you can and provide a rough estimate of time and costs by category. Don't forget to indicate opportunity costs if you can forcast losses in revenue that will result from a regulatory implementation project.
- Research (time to read the regs, seminars, travel, phone calls, consultants)
- Management (meetings to develop implementation plans, drafting of policies & procedures, establishment of quality controls to assure compliance, performance of QC & disposition of exceptions)
- Systems (modifications to legacy software systems, new software, longer run times, manual exception handling, additional record retention)
- Forms & calculations (development of form content, printing & distribution costs for paper forms, development & deployment costs for e-forms, modification or development of calculations & similar processes)
- Training of appropriate staff (almost always a major cost)
- Audit (same research & training costs as management, time to develop or cost of acquisition of work programs, time to conduct necessary audits & follow-up)
Remember: only the regulated party can comment about costs and efficiency. If your regulator hears nothing from the industry, it assumes you will experience negligible cost increases due to the proposal, and that you are happy!
Consumer groups will extoll the perceived benefits of most proposals, but reality is often another matter. Yesterday's "can't-live-without-it" reg eventually becomes tomorrow's information overload. What's YOUR assessment of the likely outcome of the proposed reg? Will it make life simpler and easier for your customers, or will it backfire and complicate your relationship? (Take note of media reports of consumer reactions to the current avalanche of privacy disclosures.) If you can suggest better ways for the regulator to carry out the legal mandate (no agency can ignore a clear Congressional mandate), your comments will be heard. You can have more impact in cases where there is no specific mandate (the e-Regs are such a case; so was the ill-fated "know your customer" proposal.)
Finally, there's the body count. If the pile of "for" comments is fatter than the "against" pile, the agency will be tempted to conclude that benefits will outweigh costs & proceed with the rule.
All comments matter, and it usually doesn't take much time to identify one or two of the major disadvantages of any proposal. With a bit of additional effort, you can arrive at a rough cost estimate--one that's at least close enough for government work. Take the time to be heard. Participation in rulemaking activities can save your bank money in the long run and can ease your "learning curve" for what will eventually become a requirement of some description.
[This message has been edited by Richard Insley (edited 05-30-2001).]