Does anyone have experience with paperless CDs? Does such a product even exist?

We are looking for a way to avoid the "I forgot to bring my CD but want to close it" scenario. Policy dictates that the certificate of deposit must be presented but this is waived quite often by branch management. This creates problems down the road when the family discovers old certificates in the desk drawer. They bring the CDs in thinking that they have just discovered extra money only to be told that the account was closed in 1997. (which takes some work on our part)

Other than 50 lashes with a wet noodle, does anyone have any thoughts?

All of our CDs are paperless. We issue a CD receipt, but to close the CD all we need is a signaute on an account closure form. No problems with this practice since I first started it over 8 years ago.

I too am interested to hear more about this process.

We currently use passbooks and are looking at moving away from them.

We haven't used paper CD's in YEARS. Book-entry is so much easier and you just provide the appropriate disclosures at the time of issuance or renewal. Each customer receives a Receipt of Deposit, but it is not required to be surrendered for negotiation. Our customers made the transition adjustment just fine. It's also simplified record retention and actually improved client relations by going paperless. Proof of identity is required at negotiation and we've not really experienced any problems with this system. It has cut down on the Operations side of things significantly as well.

How do you handle renewals?

Do you send statemts, or just a maturity notice?

CDs are auto-renewable. No statements. They get a pre-maturity notice as required - they can add money, withdrawal, negotiate rates during their grace period. If no action is taken by them, we renew at the then-current rate for their CD term.

Very, very interesting....

So then,

1) Where exactly in DD does the reg exempt CD's form getting statements? I am either blind or dumb, because I am just not seeing the exemption.

2) So all we would need to give them at opening is the TIS disclosure, and a receipt for the deposit. Can this receipt be a general deposit reciept, or should there be, or is there a more glorified CD receipt they should receive? It seems to me all they need to know is on the TIS disclosure.

3) Is there anything else I am missing or overlooking?

1) Reg DD does not require you to provide a statement for any type of deposit account. It only specifies what the statement must say if you do give one.

2) We give the TIS disclosure, privacy notice, receipt, and also have them sign a signature card (probably not necessary, but we do it) Our receipt sort of looks like a certificate, but clearly states it is a receipt and is not negotiable. I'm sure whatever system you're using is set up to do this and has all of the documentation you need

From the OSC of Reg DD:

1. General. Institutions are not required to provide periodic statements. If they do provide statements, disclosures need only be furnished to the extent applicable. For example, if no interest is earned for a statement period, institutions need not state that fact. Or, institutions may disclose “$0” interest earned and “0%” annual percentage yield earned.

I read that as well... but since we opt to give a statement on savings account, how can that then exempt CD's? Can we look at class of accounts when making these exemptions?

Also, how do you handle statements on paperless CD's when the CD has posted interest electronically transfered to an accoutn at another bank? What kind of statement form do you use then?

Does anyone else give the customer a TIS disclosure and full blown Receipt of Deposit (we use CSI, and I have found this form in their suite of forms we are not currently not using, but it has all the same information that the TIS has, so it seems redundent and more work to me)?

Opinions?

I read that as well... but since we opt to give a statement on savings account, how can that then exempt CD's? Can we look at class of accounts when making these exemptions?

If a statement is not required by another regulation, you can pick and choose as you please.


Also, how do you handle statements on paperless CD's when the CD has posted interest electronically transfered to an accoutn at another bank? What kind of statement form do you use then?

The CD's would most likely be subject to the periodic statements requirements of Regulation E, as this would be a preauthorized electronic transfer.

Does anyone else give the customer a TIS disclosure and full blown Receipt of Deposit (we use CSI, and I have found this form in their suite of forms we are not currently not using, but it has all the same information that the TIS has, so it seems redundent and more work to me)?

For most paperless CDs that I have seen, the TIL dislcosure and receipt is an integrated document.