I find the regulations that speak to overdraft and associated fees but I can't find any regulatory language that speaks to the right to charge non-sufficient fund fees where there is no overdraft. We have a customer challenging our legal standing to even charge this fee. Does regulation speak to this somewhere?

Thank you in advance.

This is a contractual, not a regulatory question. If your contract says you will charge a fee if I write a check for more money than I have, and you return the item so there is never a negative balance on my statement, then your customer agreed to that fee structure when they entered into a deposit contract with your bank.

Don't waste your time chasing someone else's legal claims. You have the right to charge the fee because your contract says you do. If the contact no longer suits your customer's needs, they may terminate the contract by closing their account.

The other counter is to invite your customer to hire an attorney (at their expense) to review state law for them to show where in state law is says you can't charge this fee. You won't find a law that says you can. (This last suggestion is tongue in cheek s it will only escalate the situation.)

Brian's last part was my only thought on this - it could potentially be a state law issue if your fee was too high, but that really felt like a stretch and very unlikely.

Thanks guys! I've scoured state UCC also but didn't find anything. I think BrianC is right, it's contractual and that's it. Thank you again for the quick response!