Funds Availability Hold - What takes precedent?

Posted By: complofcr

Funds Availability Hold - What takes precedent? - 06/21/18 03:46 PM

If we have a new customer opening an account with a check over $5,000.00 that you have reasonable cause on. Can we use the procedures for the new account or the large item? What takes precedent in this situation? If it's a new account do you always use the new account process regardless of the item?
Posted By: BrianC

Re: Funds Availability Hold - What takes precedent? - 06/21/18 03:56 PM

If there are multiple hold reasons available to you, then pick the one that affords the bank the greatest protection.

Operationally, the question is, why would we open an account using a check for which we have reasonable cause to doubt collectability? If the account starts bad, it's not likely to get better for the bank going forward.
Posted By: complofcr

Re: Funds Availability Hold - What takes precedent? - 06/21/18 03:58 PM

I agree Brian! Only reason I ask is I'm doing a review and the CSR did the hold as a large item over $5,000 and I wrote it as an exception because it should have been done as a New Account hold. Just making sure it couldn't be an either or situation.
Posted By: BrianC

Re: Funds Availability Hold - What takes precedent? - 06/21/18 04:02 PM

What the teller did may have increased the bank's risk, but it did not violate Reg CC. The regulation only provides the framework for the length of holds and the reasons we can impose them. It does not mandate that holds must be placed.