Change of Terms Notice

by Lucy Griffin, BOL Guru
Guru Bios

Question: Must we send an advance change of terms notice to MMDA customers if we plan to add a tier with higher interest to our money market accounts?

Answer: The key word here is higher. When you are changing terms in ways that will result in a higher APY for the customer, the 30-day advance notice is not required. It is a good idea to identify the change on the statements to these customers and you must also include the change on new account statements. However, because customers will earn more and not less, the advance notice is not required.

Copyright © 2004 Compliance Action. Originally appeared in Compliance Action, Vol. 9, No. 8, 8/04