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#242823 - 09/09/04 04:46 PM Reg CC notices...Do we have to keep copies??
jsides Offline
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jsides
Joined: Sep 2004
Posts: 85
Ga.
OK- I just went through a Compliance Seminar where I was informed that we, as financial institutions, are NOT required to keep copies of hold notices sent to customers? Does anyone know if this is fact, and if so is it written in the Reg? I ask because we were just written up for an error...

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General Discussion
#242824 - 09/09/04 04:55 PM Re: Reg CC notices...Do we have to keep copies??
Just Jean Offline
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Joined: Feb 2002
Posts: 582
USA
Did the seminar presenter say by whom it's not required? Both our auditors and examiners ask to see our copies of hold notices. It was suggested that we attach copies of the check(s) in question to our copy of the form.

Maybe the requirement isn't there technically but since we're always asked for copies, it close enough to a requirement for me.

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#242825 - 09/09/04 04:59 PM Re: Reg CC notices...Do we have to keep copies??
jsides Offline
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jsides
Joined: Sep 2004
Posts: 85
Ga.
No, he did not say by whom, only that we did not have to present these copies, even if asked for them. We use a daily check and balance where every hold is audited for correctness, according to the him, this was ample information for an exam...If so, and we can overturn the write up, it would be great...

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#242826 - 09/09/04 05:08 PM Re: Reg CC notices...Do we have to keep copies??
straw Offline
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straw
Joined: Nov 2002
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Section 229.30(g) record retention states a bank shall retain evidence of compliance for not less than two years.

Perhaps because of other processes you have in place, you can demostrate compliance with reg's requirement without having hold notices, but seems like you will spend more time justifying practice to examiners.

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#242827 - 09/09/04 05:17 PM Re: Reg CC notices...Do we have to keep copies??
jsides Offline
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jsides
Joined: Sep 2004
Posts: 85
Ga.
true...but if we proved one time that our check system was enough, wouldn't it make sense that we would no longer be required to present these copies in future exams, just the reports that show the system? I am a bit new at all of this so, I question everything...

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#242828 - 09/09/04 05:21 PM Re: Reg CC notices...Do we have to keep copies??
straw Offline
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straw
Joined: Nov 2002
Posts: 9,121
You could show your QC process works and then examiners could review QC process; however, the examiner's checklists ask for hold notices and if you don't have those, you are going to have to spend much time defending why you don't have the notices, with the possibility that the examiners will cite you for not having the notices.

I would rather keep the notices, unless retention creates a large burden.

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#242829 - 09/09/04 05:23 PM Re: Reg CC notices...Do we have to keep copies??
jsides Offline
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jsides
Joined: Sep 2004
Posts: 85
Ga.
hmmm...interesting...thanks so much for your response, it is great to know this forum is here for questions!
Thanks Again,
Jenn

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#242830 - 09/09/04 05:53 PM Re: Reg CC notices...Do we have to keep copies??
jsides Offline
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jsides
Joined: Sep 2004
Posts: 85
Ga.
Pouring over this Reg I find in section 229.21 "A bank shall retain evidence of compliance with the requirements imposed by this subpart for not less than two years" That seems pretty general...any form of proof that we are in compliance should be adequate...one would think. Still probing though…

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#242831 - 09/09/04 06:07 PM Re: Reg CC notices...Do we have to keep copies??
Skittles Offline
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Skittles
Joined: Sep 2002
Posts: 13,965
TN
We keep copies of the hold notices along with copies of the item(s) deposited. They really like this when performing a review. Also, the head of retail went to a seminar yesterday and was told that this will be covered more in upcoming exams.
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#242832 - 09/09/04 06:14 PM Re: Reg CC notices...Do we have to keep copies??
jsides Offline
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jsides
Joined: Sep 2004
Posts: 85
Ga.
We keep these copies as well, but the problem is one of the copies we had was not dated correctly, which caused a write up. Had we not provided that copy, no write up would have been possible...if in fact this is not something we HAVE to do than many write-up's could be avoided for financial institution's. Just because it is how it has always been done, does not make it right, but then, lol, I am a bit tense about things like this...:)

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#242833 - 09/09/04 07:21 PM Re: Reg CC notices...Do we have to keep copies??
Just Jean Offline
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Joined: Feb 2002
Posts: 582
USA
It seems to me that you can't erase the past so you just have to live with the write-up and vow not to make the same mistake again. I think that, since you've been written up once for an error, they will be disturbed if you suddenly explain that you don't need to keep copies anymore.

I don't see the "if we hadn't made copies, they wouldn't have found the error" as a valid argument.

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#242834 - 09/10/04 02:25 PM Re: Reg CC notices...Do we have to keep copies??
jsides Offline
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jsides
Joined: Sep 2004
Posts: 85
Ga.
Yes it seems there is nothing I can do about this write up however, for any who are interested: There is no retention on Reg CC notices, other than Exception holds where you have marked other as the reason...according to a BOL guru, and what I have read in the Reg, what we as a financial institution have to prove is that we are in compliance, that proof does not have to come from copies of notices…

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#242835 - 09/11/04 08:54 PM Re: Reg CC notices...Do we have to keep copies??
Elwood P. Dowd Offline
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Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
From the Commentary to Reg CC:

A bank is not required to retain records showing that it actually has given disclosures or notices required by this subpart to each customer, but it must retain evidence demonstrating that its procedures reasonably ensure the customers' receipt of the required disclosures and notices. A bank must, however, retain a copy of each notice provided pursuant to its use of the reasonable cause exception under Sec. 229.13(g) as well as a brief description of the facts giving rise to the availability of that exception.
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#242836 - 10/12/04 06:37 PM Re: Reg CC notices...Do we have to keep copies??
Anonymous
Unregistered

Ken--right on top of everything as always! One of the most common errors I note when conducting compliance exams at our banks is failure to document the facts leading to the hold. If Bob at ABC Bank was called and indicated the check was not good--write it down on our copy of the check or hold notice and retain it with a copy of the hold notice. If you are placing the hold late because you identified possible kiting the next day, place the hold and document that the customer appears to be drawing on uncollected funds. Document, document, document!

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