Compliance Issues when Marketing HSAs

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Question:

We're marketing HSAs. Marketing considers this a checking account and only needs Member FDIC. Compliance says we need insurance disclaimers (not, not, may). Who is right?

Answer:

An HSA is an account type governed under the IRS regulations. It can be invested into a number of different vehicles. They could be invested in to an FDIC insured vehicle or they could be invested in a non-FDIC insurance vehicle. It depends on what type of a vehicle the HSA is invested. If they are held at the bank in an FDIC insured checking product, then no "not, not, may" disclosure is required as they would be FDIC insured.

First published on BankersOnline.com 1/18/10