We have a few checking accounts with no maintenance or activity fees. We would like to say in an ad that we offer accounts with no monthly fees. However, an account customer may add a benefits program to their account at their election for $6 a month.

Does the customer's election to add a product to an account where the fee will be assessed each month, disqualify us from being able to advertise the account as having no monthly fees?

You will find your answer in Comment 8(a)-10.v.

10. Examples. Examples of advertisements that would ordinarily be misleading, inaccurate, or misrepresent the deposit contract are:


* * * *

v. Advertising an account-related service for which the institution charges a fee in an advertisement that also uses the word “free” or “no cost” (or a similar term) to describe the account, unless the advertisement clearly and conspicuously indicates that there is a cost associated with the service. If the fee is a maintenance or activity fee under Sec. 1030.8(a)(2) of this part, however, an advertisement may not describe the account as “free” or “no cost” (or contain a similar term) even if the fee is disclosed in the advertisement.

Thanks for the response, but I need clarification...sorry...

The benefits program will not be advertised in the same ad. The ad will only say "Offering Accounts with No Monthly Fees". This statement is true. A customer can walk in and get a checking with no maintenance or activity fees.

Now once in our FI to open an account, the CSR will tell the customer about the add on product. If the customer elects this product, the cost of the product will be debited from their account monthly.

I guess my question is...does a monthly fee for an add on product fall under maintenance and activity fees (service charges)? or is it a separate animal since it is an election?

The answer to that is no. Just make sure that this add on product is not one the products under the microscope by the regulators for unfair and deceptive practices.

Thank you very much!!!