Does anyone charge a re-opening fee for a customer who previously had a charge-off and has paid it? Our Assistant Compliance Officer and I are concerned (he thought of it first) that this could be a UDAAP issue. If I pay off a checking account here after charge-off and open another account elsewhere I wouldn't pay this fee.

We do not charge a re-opening fee, but we would probably not open another account fo that customer to begin with. (once bitten, twice shy, and all of that)

We do not charge a fee. IF they pay us back, we may give them a second chance and open another account, but we will watch it very carefully and probably close at the first sign of trouble. If they don't pay us back, we will not open another account for them.

Not a fan of reopening such accounts. The contract is void, and without another contract, where are you? A better approach, if you are moved to allow the customer to have another go at it, is to open a new account.

Thanks John - and that's how I feel; however the old adage applies here - 'that's how we've always done it'.

I'm not involved with account openings but if you reopen an account that had previously been open for at least 6 months; they would not be subject to the new account hold schedule?

Check out Reg CC section 229.13(a)(2). An account is not considered a new account if each customer on the account has had, within 30 calendar days before the account is establioshed, another (transaction) account at the depository bank for at least 30 calendar days.

The other problem with re-opening is that it makes people forget to do CIP when the customer has no other accounts with the bank.

A friend (FDIC examiner) loves it when banks "reopen" closed accounts, it's one of his "pet" questions because they are rife with CIP errors.

It's a lousy banking practice with nothing to commend it but tradition and laziness.