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#1530831 - 04/01/11 08:19 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Bob The Banker
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Diamond Poster
Joined: Nov 2004
Posts: 2,310
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Opinions expressed are my own and not necessarily those of my employer. They are not legal advice.
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#1531111 - 04/04/11 04:15 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Reads Regs
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Platinum Poster
Joined: May 2010
Posts: 958
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I see, however, this Q&A still does not answer if we should be disclosing the de minimis amount to customers? My opinion is no, as customers will use and abuse this and come up with the argument well I only overdrew by $10.50 which is only $0.50 more than the de minimis! However, I would like to see my opinion confirmed somewhere by the FDIC.
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#1531117 - 04/04/11 04:23 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Bob The Banker
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Power Poster
Joined: Apr 2001
Posts: 4,828
Between the lines
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OD Fees are supposed to be a deterrent to the customer that encourage him to avoid ODs. How does having a "sale" on OD fees act as deterrent?
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NOLA is my Beach!
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#1531143 - 04/04/11 05:12 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
SMQ, CRCM
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Platinum Poster
Joined: May 2010
Posts: 958
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OD Fees are supposed to be a deterrent to the customer that encourage him to avoid ODs. How does having a "sale" on OD fees act as deterrent?
[sarcasm] Don't be so high and mighty and act like people are supposed to know what's in their account! [/sarcasm]
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#1531149 - 04/04/11 05:16 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Bob The Banker
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Power Poster
Joined: Apr 2001
Posts: 4,828
Between the lines
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[sarcasm] Silly me, I'm from the generation where we lived "personal responsibility" [/sarcasm]
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#1531169 - 04/04/11 05:43 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
SMQ, CRCM
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Member
Joined: Jun 2008
Posts: 83
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I think if you try the approach that the fees are supposed to discourage the overdraft, they will ask you to prove it.
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#1531202 - 04/04/11 06:29 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Justin Wesson
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Platinum Poster
Joined: Apr 2005
Posts: 684
Jersey Shore
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Bob - Contacting an apps developer this afternoon - check register app should be available soon!
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#1531295 - 04/04/11 08:15 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Jerseygirl
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Georgia Plum
Unregistered
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A check register, what a concept.
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#1532901 - 04/07/11 06:44 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
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Member
Joined: Jun 2008
Posts: 83
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Here is a quote from the PCBB daily and their analysis of the FDIC FAQ: While there is nothing new here, the FAQs elaborate on how and when banks should counsel chronic users of ODs, as well as making sure banks set some minimum OD where they are not assessed a fee. Of particular note is that banks will be required to have a documented system to monitor whether the OD fee is reasonable relative to the OD amount. Is it me, or did they miss the boat?
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THANK YOU GOVERNMENT:
“If I seem unduly clear to you, you must have misunderstood what I said” - A. Greenspan
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#1533084 - 04/07/11 09:27 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Sheldon Hendrix
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Member
Joined: Dec 2005
Posts: 60
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Am I missing something here? If we set our limit to three paid OD fees per day, only allow those three items to be paid each day (unless others are under the de minimis), return all other items, and charge a return fee, aren't we in compliance, we still collect fee income, and the consumer is worse off because their check isn't paid?
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#1533115 - 04/07/11 10:26 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Bob The Banker
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100 Club
Joined: Feb 2006
Posts: 178
LA
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Bob the Banker,
I submitted several questions prior to the teleconference, one was asking if we must disclose de minimis and daily limits/caps on fees. Wasn't covered during the call nor do I see it in the FAQs. We instituted a de minimis last year & have not disclosed, but Examiners won't be here until Summer, so no official opinion. For what it is worth, several years ago (prior to a merger)we had an advertised overdraft protection program, instituted a daily maximum on fees & never disclosed...any other thoughts?
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#1533120 - 04/07/11 10:39 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
dcl1963
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Member
Joined: Jun 2008
Posts: 83
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Timex
I guess there can be two points to the deminimus problem, the amount of the transaction i.e. the $4.00 latte, and the amount of the overdraft, i.e. they are already overdrawn $100 when they buy the latte. A per-item deminimus rule seems very difficult to implement, but maybe where we are headed like the credit card late fees and if you already have the deminimus balance rule, the point in the FAQ should be moot.
Regardless, My point is that it was very strange for PCBB to pick-up on this as the noteworthy item from the FAQs. I wonder if the writer understands the programs and their usage...
DCL
I hope this comes out right, I know you asked it somewhere else...
I would think that not disclosing those features could be viewed in a positive light as the fact that they are not disclosed would not cause a person to incur more fees. In-fact they do just the opposite...if a person thinks that every $2 transaction will incur a $30 fee, they might be less likely to make as many. I would like to hear from one of the other members, but my thought is that disclosure of a voluntary limit on fees does not seem to be required.
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#1533163 - 04/08/11 12:28 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
dcl1963
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Platinum Poster
Joined: May 2010
Posts: 958
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Bob the Banker,
I submitted several questions prior to the teleconference, one was asking if we must disclose de minimis and daily limits/caps on fees. Wasn't covered during the call nor do I see it in the FAQs. We instituted a de minimis last year & have not disclosed, but Examiners won't be here until Summer, so no official opinion. For what it is worth, several years ago (prior to a merger)we had an advertised overdraft protection program, instituted a daily maximum on fees & never disclosed...any other thoughts? Thanks for the feedback. Our attack plan right not is not to disclose the de minimis amount as it will open up a high risk for abuse. However, I do feel it is necessary to disclose the maximum. No abuse can come from this and from a service standpoint, if the bank is going to limit the amount of overdrafts paid, this is information the customer needs to know. We insert the maximum on our fee schedule. We also do this because the caps for business and consumer accounts differ.
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#1533164 - 04/08/11 12:31 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Justin Wesson
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Platinum Poster
Joined: May 2010
Posts: 958
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Timex
I guess there can be two points to the deminimus problem, the amount of the transaction i.e. the $4.00 latte, and the amount of the overdraft, i.e. they are already overdrawn $100 when they buy the latte. A per-item deminimus rule seems very difficult to implement, but maybe where we are headed like the credit card late fees and if you already have the deminimus balance rule, the point in the FAQ should be moot.
Regardless, My point is that it was very strange for PCBB to pick-up on this as the noteworthy item from the FAQs. I wonder if the writer understands the programs and their usage...
DCL
I hope this comes out right, I know you asked it somewhere else...
I would think that not disclosing those features could be viewed in a positive light as the fact that they are not disclosed would not cause a person to incur more fees. In-fact they do just the opposite...if a person thinks that every $2 transaction will incur a $30 fee, they might be less likely to make as many. I would like to hear from one of the other members, but my thought is that disclosure of a voluntary limit on fees does not seem to be required. We took the approach to institute the $10 de minimis amount in the guidance. If the transaction results in an account balance between ($10.00) and $0.00, no fee is charged. Dollar amount of items have no bearing. So if you are foolish enough to buy a $4.00 latte, after opt-ing IN for debit purchases, and your balance is ($200.00), you will receive an overdraft fee, and personally, I have no sympathy for someone in that situation.
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#1533286 - 04/08/11 03:16 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Bob The Banker
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Member
Joined: Jun 2008
Posts: 83
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ouch Bob...lol...
I agree, and I agree with all the ABA papers about consumer choice and responsibility even though they are written by the folks that sell these prgograms...but I can see why it will be a hot topic and a source of new regularory burden from the new CFPB because the banks can not help get themselves out of this fee feeding frenzy.
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“If I seem unduly clear to you, you must have misunderstood what I said” - A. Greenspan
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#1533299 - 04/08/11 03:28 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Justin Wesson
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Member
Joined: Jun 2007
Posts: 87
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Has anyone written an overdraft program policy that you would be willing to share?
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#1533381 - 04/08/11 04:49 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Bob The Banker
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100 Club
Joined: Mar 2006
Posts: 140
CA
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So, what if your customer is overdrawn $20.00 and three more transactions come through that total less than $10.00 - $3.50, 2.00 & $4.00 - will you charge them $90 for those three items?
We're finding out this happens more often than we would ever have thought. And we're going through an audit right now and the auditor is going to strongly recommend that we charge fees based on transaction amount. And I think I would have to agree.
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#1533386 - 04/08/11 04:54 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
fnbgal
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Member
Joined: Jun 2008
Posts: 83
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You are lucky that your auditor is looking before your examiner does...
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#1533393 - 04/08/11 05:01 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Justin Wesson
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100 Club
Joined: Mar 2006
Posts: 140
CA
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You are so right...we all talk about that expensive cup of coffee - we just didn't know that they would have three a day.
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#1533403 - 04/08/11 05:09 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
fnbgal
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Member
Joined: Jun 2008
Posts: 83
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Is three really the limt? We could have 6 expensive cups...
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#1533413 - 04/08/11 05:19 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Justin Wesson
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Posts: 21,293
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#1533450 - 04/08/11 06:02 PM
Re: FDIC "Final OD Payment Supervisory Guidance"
Kathleen O. Blanchard
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Georgia Plum
Unregistered
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KB, no limit on those if you use a debit cartd!
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