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#1553745 - 05/19/11 03:56 PM OD Charges for Service Charge
Compliance Audit Offline
100 Club
Joined: Mar 2005
Posts: 200
If an account is overdrawn due only to a service charge posting to the account - the account balance was $0.00 when the service charge was assessed - can we charge our daily continuous OD fee?

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#1553854 - 05/19/11 05:34 PM Re: OD Charges for Service Charge Compliance Audit
BSABecky Offline
100 Club
Joined: Mar 2011
Posts: 126
Seymour, IN USA
I would say the service charge is something the client is aware of, so they should be leaving that amount in there monthly to cover it. Therefore, they should incur the OD fee. It's not the service charge that overdrew the account; it was the debit transaction prior to it. wink
My opinions do not necessarily reflect those of my employer.

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#1554049 - 05/19/11 09:10 PM Re: OD Charges for Service Charge BSABecky
rlcarey Online
10K Club
Joined: Jul 2001
Posts: 78,971
Galveston, TX
If you are FDIC regulated, you probably want to be prepared to be cited for a UDAP violation unless service charges are specifically listed as the type of transaction that can cause an overdraft.
The opinions expressed here should not be construed to be those of my employer:

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#1554433 - 05/20/11 03:15 PM Re: OD Charges for Service Charge rlcarey
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 39,598
Cape Cod
I agree with Randy. Also, if you're FDIC supervised and operate an automated OD payment program, each time you hit the account with an OD fee, including one triggered by another fee, is an "occasion" inexorably building toward that 6-in-12 threshold.
John S. Burnett
Fighting for Compliance since 1976
Bankers' Threads User #8

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