We use Wolters Kluwer platform for new accounts. We have added a new form "Terms & Conditions Overdraft Addendum" Do we have to mail this four page document to all existing account holders?

Does this change or augment your current T&C? If it does, how are you going to impose whatever it says on current customers without informing them?

We are not making any changes. This disclosure just provides more information about NSF's and how items are posted. No changes to how bank currently handles overdrafts/NSF's.

Then why use it? Because the forms vendor recommended it? It is really not a good idea to give information to just some of your customers in writing whether it changes your current processes or not. There has to be a reason for the use of this form.

I'd like to add to this post as we also received this new Addendum from Wolters Kluwer. As mentioned above, the new Addendum doesn't necessarily change what we are doing, but spells it out in more detail. We like it because it specifically includes clarifying language for certain practices that have been the focus of recent lawsuits against financial institutions.

Wolters Kluwer has indicated that they can provide a "change notice" that we can then provide to our existing customers. We are considering using their notice and trying to determine how to compliantly and efficiently provide it to more than 50,000 existing customers. Since its a Terms & Conditions update, would it be acceptable to post the "change notice" on our website and use a statement message to direct customers to view it there or to request a copy free of charge by contacting us in a specific manner?

I don't know of any state contract law that would allow you to modify an account agreement in this way. As with any change to your deposit contract, your legal counsel should provide guidance on how your state requires that it be communicated. Your forms vendor wants to sell you more forms. It's what they do.

"Hi, we're changing the terms of your account and if you want to know what they are you have to go look for them or ask us to send them to you." This simply won't work and I'm sure would not hold up in court if it were ever challenged.

Basically these Terms and Conditions are not account specific and did not really change. The are basic definitions like what a postdated check is etc. Back last year they removed explanations of Overdrafts and became a 13 page document instead of 10 pages from removing columns and having a larger font. Then they wanted us to add a Overdraft Addendum this year that was an additional 5 pages to the Terms and Conditions. On the last page of the Terms & Conditions we could add additional information which is where we defined Overdrafts in a more concise manner. We maintain any changed document so we can determine what was given to what period of time an account was opened. In my opinion this was a way for the company to tried to make extra money off banks and after really reading the Addendum, it did not reflect our verbiage and I felt it would be more confusing to the customer and potential UDAAP issues. I checked other resources and there was no requirement to issue a change notice since the information was the same.