I am in charge of taking care of mail that is returned back to our bank. My question is if the label reads undeliverable mail, do we have to continue sending the statements out?

No reason to waste the postage. Most banks have some sort of "lost contact" flag set on the account and the escheat clock starts to run.

We also do not send out our accounts that are returned undeliverable mail. I agree that there is no reason to waste the postage when you know it is coming back. We change our address field to "underliverable mail" and it is stored in a secured location in the vault due to fraud security measures. We record the date that we receive the undeliverable mail and that is when we start our escheat dates. I hope that this helps.

It's also a security risk. If you continue to send out statemtents that were previously returned undeliverable, there may be a chance that one will end up in the wrong hands.

We were recently written up by internal audit during a deposit operations audit for not "doing anything" with our returned mail. I am the Compliance Officer (formerly the auditor here) and I handle all undeliverable mail - it is controlled by me and kept locked in my office. When I was in audit and had an assistant, we would look up the accts with undeliverable statements on our system, forward those with new system addresses, and after 3 returns we would place a "hold in audit - undeliverable" address on those that did not have updated addresses. I told the auditors that when my role changed I no longer had time to "research" each and that I now review approx every 6 months. To me, researching was a courtesy to the customer -who in most cases did not bother to change their address with the Bank and it should not be an audit finding - I lost the fight! They also suggested that transaction reviews be done on these accounts from time to time - which I believe should be performed by internal audit but they disagree. Your thoughts please

All of what you describe with regard to handling return statement mail can be described as control functions. Who "owns" these control functions in a bank will depend on history, culture, power trips, egos, effectiveness, and a lot of other variables.

Evidently, Audit at your bank is under the impression that you "own" this albatross and took it with you when you changed responsbilities. My personal view is that none of this is a Compliance matter, and really belongs to either Operations or Audit.

So, if your bank is still into "silos" of responsibility, find a way to sweep this control function out of your silo, if you can. You stated it best: You won't have the time to retain this responsibility.

What should the retention period be for undeliverable mail? Not only statements but 1099's and other mail. The money may be escheated but that doesn't solve the issue of the statements.

If you can reproduce the statements/notices - drop them immediately in the shredder.

This is an Operations function. If it is written into policy with a procedure to follow everyone should be happy. (except maybe operations)

We flag the account the first time mail is returned as undeliverable. I wonder if it would be a privacy issue to continue to send statements and the like after that first return.

It's not necessary to retain the envelope for a certain period of time as proof of attempted delivery?

Is it okay to charge customer's a fee for returned mail?

It seems to me that to continue to send statements to an address you know is invalid is inviting trouble. While it's true that the customer has a duty to notify you of the change of address, you have a duty not to expose their information to identity theft.

We flag the accounts as undeliverable, and while some slip through and get mailed occasionally, we simply put them in the dead letter file. You would think customers would notice not getting a statement, wouldn't you, especially after two or three months.

Most of the time if the statement has activity the correct address is on the printed checks/images in the statement. And if the account has deposits, find out which branch the customer goes to and notify that branch that you need a current address. I send out e-mails to the applicable branch and usually have a good address within a couple of days.