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#548566 - 05/16/06 06:51 PM Reg DD & pulling my hair out!!!
Snowgirl Offline
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Joined: Sep 2003
Posts: 729
Sorry this is so long, but here goes:

The more I read the more confused I become. Just when I think I have it figured out - I read something somewhere and it comes back and slaps me. If anyone can give me some guidance I would really appreciate it. Here is what we do at our bank:

We do give an upfront disclosure to all new accounts before opening the account that includes our overdraft policy. It states the 3 different types of protection available including sweeps from account to account; sweeps from LOC loans; and Bounce Protection (BP). It states we pay items largest to smallest and that items include checks, ATM/POS withdrawals, Visa Ck cards, ACH Debits, etc. It states we are not obligated to pay any overdrafts and the timeframe to repay overdrafts. Their initial disclosures also list the fee they will incur for overdrafts whether paid or returned as: NSF (Paid or returned) $XX.XX with a maximum of $XXX.XX per day and Bounce NSF (Paid or returned) $XX.XX with a maximum of $XXX.XX per day. BUT, I thought that disclosures were ok to mention the ODP information in and would not trigger additional disclosures. IS THIS CORRECT?

We do include their BP limit in their available balance at the ATM and on our on-line banking. We have disclosures at both of these that indicates their available balance may include their BP Limit. We do not include the BP limit on our 24-hour phone response system.

Also, our computer has been updated to include all of the statement requirements.

Now the questions:

We have not broken down our fee and named it two different names as it is the same charge regardless and we have stated whether paid or returned. IS THIS SUFFICIENT? Also I have been told that our fees should read like the following: Effective July 1 it needs to read something like the following: “Insufficient Funds Fee - - - - - $XX per item. An insufficient funds item may be created by check, in-person withdrawal, ATM withdrawal or other electronic means.” DO WE HAVE TO HAVE IT WRITTEN LIKE THIS OR IS THE WAY I DESCRIBED ABOVE IN OUR DISCLOSURES SUFFICIENT?

I have been reading the Regulation DD – ODP Resource Guide that is published on the BOL site and am having some trouble with an item. Under the heading: Communications that are considered advertisements for the payment of overdrafts on bullet #3 it states: Disclosing an overdraft limit or including the dollar amount of an overdraft limit in a balance disclosed by any means, including on an ATM receipt or in an automated system, such as a telephone response machine, an ATM screen, or on the institution’s Internet site. Then later down under Excluded communications under the second paragraph titled If the communication fits any of the above exceptions, or any of the following descriptions, it will not trigger the additional advertising disclosure requirements (described below) of 230.11(b) – on the third bullet – An ATM receipt. DON’T THESE TWO ITEMS CONTRADICT EACH OTHER? Do we have to provide another message at the ATM and on our on-line system about the possibility of a charge if they access their BP and will incur an NSF fee? Because I was told the following: "There is a difference between what is considered an advertisement and what has to be disclosed, just because it’s considered an advertisement it doesn’t always trigger the requirements; such is the case with the ATM receipt. It does not have to have that additional information on it."

Anything else I'm missing? A big THANK YOU for any help you can provide me.

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#548567 - 05/16/06 08:10 PM Re: Reg DD & pulling my hair out!!!
RVFlyboy Offline
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Soaring over Georgia
First, if you charge fees for returning an item and you charge fees for paying an item into overdraft you must separate those two. You must call those fees two different names. You can't call them the same thing even if they are the same amount.

Second, including the BP amount in available balance on an ATM receipt is considered promotion and does trigger the statement requirements and advertising requirements pertinent to those institutions that promote ODP plans. But the inclusion of the BP balance on the ATM receipt does not trigger additional advertising requirements on that same ATM receipt.
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#548568 - 05/16/06 08:41 PM Re: Reg DD & pulling my hair out!!!
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
Jim, your answer is an exemplar for accurate brevity.

It's not too late, Snowgirl, to sign up for my "ODP or NOT: Are You Ready for the Changes to Regulation DD?" webinar, set for 1:30 CT tomorrow (Wednesday, 5/17).

Go to http://www.bollearningconnect.com to sign up.
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#548569 - 05/16/06 11:12 PM Re: Reg DD & pulling my hair out!!!
Snowgirl Offline
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Joined: Sep 2003
Posts: 729
Quote:

First, if you charge fees for returning an item and you charge fees for paying an item into overdraft you must separate those two. You must call those fees two different names. You can't call them the same thing even if they are the same amount.

Second, including the BP amount in available balance on an ATM receipt is considered promotion and does trigger the statement requirements and advertising requirements pertinent to those institutions that promote ODP plans. But the inclusion of the BP balance on the ATM receipt does not trigger additional advertising requirements on that same ATM receipt.




Am I understanding this to say: if the only promotion of overdrafts is by including the balance, then we do not have to have the additional advertising requirements on the receipt?

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#548570 - 05/17/06 02:44 AM Re: Reg DD & pulling my hair out!!!
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
If you include the ODP "cushion" amount in the balance printed on the receipt, the receipt becomes an ad. Because of its special nature, however (there's not enough space), this ad does not trigger any of the disclosure requirements in §230.11(b)(1). It DOES, however, mean that the bank is promoting the payment of overdrafts, and triggers the statement requirements in §230.11(a).
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#548571 - 05/17/06 11:15 PM Re: Reg DD & pulling my hair out!!!
Snowgirl Offline
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Joined: Sep 2003
Posts: 729
Thank you John!!!

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#548572 - 05/18/06 01:38 PM Re: Reg DD & pulling my hair out!!!
Maria Offline
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Joined: Apr 2001
Posts: 502
Sylacauga, Al, United States
John or Jim:

I did attend the webinar yesterday but now I have some concerns about our ATMs and Voice Response. Our ATM screens and Voice Response both quote the available balance which includes the ODP. The VR states that your available balance may include ODP but neither the ATM or the VR identify the cost of an OD or the amount of time to pay it back. If I understood the webinar correctly, I need to identify these items on both the ATM screen and the VR. Is this correct? I am really confused on this.

Thanks so much!

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#548573 - 05/18/06 09:58 PM Re: Reg DD & pulling my hair out!!!
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
You are correct, if the balance shows up on the ATM screen. And that includes the screen of an ATM in Bangor, Maine, where you can't possibly disclose your fees and period for repayment. And yes, including the ODP cushion in a balance on your VRU triggers those two disclosures, too.

No disclosure problem if the balance only prints on the ATM receipt. But you cannot control that at that bank in Bangor, either.

The Q&A document on the webinar ran 19 pages, Maria. I just finished it. You should get an email notifying you it's ready for downloading sometime Friday (tomorrow). You'll find a lot of information there.
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