Closing & Reopening Accounts - New Disclosures?

Answered by:

Question:

When closing a consumer account due to stolen checks or a similar reason and opening another account of the same type (same fees, same name, etc.), is it necessary to provide all the disclosures that are normally provided at account opening? This question has come up because we are in the process of changing our account offerings; the new accounts will have different names, fees, etc. The new account TISA disclosures will reflect the new account offerings. When we do a "close and reopen" we can open the same account type as the customer's original account, however, the new account TISA disclosures will not include information on that account type. What is required in this situation?

Answer:

The short answer is "yes." You are opening an account and that is the act that triggers the disclosures. You might note that new account disclosures must be given when a time account is renewed and the same idea applies here.

Your TISA disclosures should reflect the account that is being opened for the consumer. If you have merely changed account names, you could make the disclosure accurate by crossing out the printed name and writing in the account name with which they are familiar. If the terms and conditions are different than what the consumer is getting, you will have to find a way to accurately disclose those terms and conditions.

First published on BankersOnline.com 3/26/07