The OCC cited us for the following: when a customer split deposits a non-local check and gets $100 back at the time of deposit, we do not then give an additional $100 of availability the next day. I cited comment #5d in the OSC to 12 CFR 229, which says that we do not have to give an add'l $100 of availability the next day for local checks. Our external auditor agrees. However, the EIC says that, since the OSC is silent as to non-local checks, the comment re: local checks can't be applied. We are hesitant to go to the Ombudsman with this for fear of ruffling local OCC feathers, but to comply would create big operations headaches. Advice, comments, or corrections?

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I hate Reg. CC and will choose to have root canal before taking charge of it again. So I can't speak to the attributes of CC.

While I believe you are smart to choose your battles, if this is a big issue and it will continue to be so, ask the EIC for verification. While the ombudsman is an option, I have always been told it is fine with the regulators on-site if you want to go that route. While they sounded genuine, that may the required talk-off.

But you should feel free to question the EIC. Just as we have this forum to use, they have one in which regulators share ideas. Have it queried there. The EIC should be receptive to gathering a second opinion unless they are absolutely sure of their position.

And if you continue to question it and forsee costs or repeat violations, go to the ombudsman.

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Andy Zavoina
Opinions stated are not necessarily that of my employer.

Point the EIC to comment 5a - The Act and regulation also require that up to $100 of the aggregate deposit by check or checks not subject to next-day availability on any one banking day be made available on the next business day. For example, if $70 were deposited in an account by check(s) on a Monday, the entire $70 must be available for withdrawal at the start of business on Tuesday. If $200 were deposited by check(s) on a Monday, this section requires that $100 of the funds be available for withdrawal at the start of business on Tuesday. The portion of the customer's deposit to which the $100 must be applied is at the discretion of the depositary bank, as long as it is not applied to any checks subject to next-day availability.

Specifically call attention to "The portion of the customer's deposit to which the $100 must be applied is at the discretion of the depositary bank, as long as it is not applied to any checks subject to next-day availability."

If that doesn't work, ask him to get an opinion from his home office. He's all wet on this one.