Our lending operations department (not credit card) would like to initiate an EFT through our third party vendor to debit our customer's deposit account to exercise our right to offset for amounts owed on our customer's loan. Our deposit account terms and conditions discloses our right to offset any amounts owed to the bank. We know that generally Reg E, Section 205.3 (c)(5) would allow the bank to electronically transfer funds between a customer's accounts without the customer's specific request under certain circumstances and that the official commentary provides that this exception to Reg E includes the right to initiate "electronic debits or credits to consumer accounts for check charges, stop-payment charges, NSF charges, overdraft charges, provisional credits, error adjustments and similar items that are initiated automatically on the occurrence of certain events." In order to exercise our right to offset electronically, the transaction will need to be processed through our third party vendor. Do we have any Reg E or other regulatory concerns in doing so?
We currently mail overdraft and insufficient funds notices to customers. Is it permissible to send these via e-mail if agreeable with the customer? If so, are there specific parameters governing this?
We accept ACH debits from our savings accounts. When one comes in that is "NSF" can we charge an "NSF" fee if we properly disclose it on our account charges?
If your bank offers bill payment over the Internet banking service, does the Reg E disclosure have to state more than the fees your bank can impose, plus the customer's "agreement to pay any additional reasonable charges not covered by the (internet banking) agreement" (for example, if the payment is NSF and the merchant charges an NSF fee electronically as well)? Can that NSF fee then be charged against the customer's account, or are there additional notices which would need to be provided?
Question: We have a customer who wants to "protest a check." Can you explain this?