Question & Answer

Question:We recently decided to change our hold policies. Do we have to send our customers a complete new disclosures or can we send information about the changes?

Answer: In Regulation CC, any changes in policy must be disclosed to the customer at least 30 days before the change takes effect. If the change is in the customer's favor, such as shortening the length of a hold, the notice may follow the implementation of the policy within 30 days.

When you change a policy, you must make new disclosures and -here's the catch - the disclosures must clearly identify the change. The bank must direct the customer's attention to the change. You can do this by using an insert, a special letter, or highlighting the changes. This effect of this rule is that the simplest, least expensive method may be the best compliance. A statement stuffer meets this test whereas complete new disclosures would have to be specially marked to comply.

Copyright © 1996 Compliance Action. Originally appeared in Compliance Action, Vol. 1, No. 5, 3/96