I'm not sure how close this is to becoming regulation, but am I reading the below proposed changes to Regulation AA correctly? After having to go through an Opt-out for Regulation E purposes, now we're going to have to go through an Opt-out procedure for ANY cause of an overdraft if we want to charge the customer under our standard Overdraft Services?

Overdraft Services
The Agencies are proposing two
provisions prohibiting unfair acts or
practices related to overdraft services in
connection with consumer deposit
accounts. The proposed provisions are
intended to ensure that consumers
understand overdraft services and have
the choice to avoid the associated costs
where such services do not meet their
needs.
The first would provide that it is an
unfair act or practice for an institution
to assess a fee or charge on a consumer’s
account for paying an overdraft unless
the institution provides the consumer
with the right to opt out of the
institution’s payment of overdrafts and
a reasonable opportunity to exercise the
opt out, and the consumer does not opt
out. The proposed opt-out right would
apply to all transactions that overdraw
an account regardless of whether the
transaction is, for example, a check, an
ACH transaction, an ATM withdrawal, a
recurring payment, or a debit card
purchase at a point of sale.
The second proposal would prohibit
certain acts or practices associated with
assessing overdraft fees in connection
with debit holds. Specifically, the
proposal would prohibit an institution
from assessing an overdraft fee if the
overdraft is caused solely by a hold
placed on funds that exceeds the actual
purchase amount of the transaction,
unless this purchase amount would
have caused the overdraft.

Why can't they look at overdrafts overall and come up with ONE opt-in/opt-out that covers everything. This is ridiculous.

This may be an older or out-of-date proprosal so I'm trying to find more information as to the status. Perhaps the Reg E change replaced this proposal, as there is some discussion in the proposal of limiting this action to only ATM and debit card transactions. I'm hoping this is the case!

The proposal is dead, for the time being.

I'll even take "for the time being"; anything to keep the load down...thanks John

Has anyone heard anything about this "coming back to life?"

If it does, it will probably be after the CFPB becomes active. I don't see the FFIEC agencies agreeing on a proposal and shepherding it through the comment and final rule stages between now and July 21.

From the FDIC's Guidance on Automated Overdraft Programs:

Although the FRB did not address the payment of overdrafts resulting from non-electronic transactions, such as paper checks or automated clearing house (ACH) transfers, the FDIC believes institutions should allow customers to decline overdraft coverage (i.e., opt-out) for these transactions and honor an opt-out request.

Avoiding the nearly overwhelming temptation to ridicule any government agency's use of the word "should" unsupported by reference to law or regulation, I can only say that it's possible that this issue will be laid at the feet of FDIC supervised institutions after July 1.