Does a fee schedule that is provided at account opening meet the definition of an advertisement per 12CFR1030.11(b)(1)(ii)? Auditors are suggesting that we need to include the categories of transactions for which overdrafts may be imposed and also include the FDIC logo. Auditors are including it as a finding in our recent audit. I'm not sure I agree with them as the categories of transactions is included in the Account Terms disclosure.

Your auditors are wrong. A disclosure that is required under the regulation is not an advertisement.

1030.2(b) Advertisement.

2. Other messages. Examples of messages that are not advertisements are:

v. Disclosures required by federal or other applicable law.

vi. A deposit account agreement.

If you are fully disclosing your overdraft policy in the depositor's agreement, they are no requirements for disclosures under Reg DD to be segregated.

Section 1030.3--General Disclosure Requirements

(a) Form.

1. Design requirements. Disclosures must be presented in a format that allows consumers to readily understand the terms of their account. Institutions are not required to use a particular type size or typeface, nor are institutions required to state any term more conspicuously than any other term. Disclosures may be made:

i. In any order.

ii. In combination with other disclosures or account terms.

iii. In combination with disclosures for other types of accounts, as long as it is clear to consumers which disclosures apply to their account.

iv. On more than one page and on the front and reverse sides.

v. By using inserts to a document or filling in blanks.

vi. On more than one document, as long as the documents are provided at the same time.

I agree with what Randy said, however, our outside reviewer also suggested to us a few years back that we should add a clear statement to our fee schedule detailing what our overdraft fees are charged for. For example, an insufficient funds charge would be assessed when a check, electronic check, external withdraws & recurring debit card transactions overdraw the account and our premium OD usage fee is charged on overdrafts caused by everyday POS purchases and ATM withdraws.

It's just one more way for us to make sure the customer understands what certain fees are charged for, even though it is disclosed in our overdraft program agreement.

We also put Member FDIC on all disclosures....

Is it a good idea - sure. Should it result in an audit finding rather than possibly a recommendation - no. Have them point to the regulation that is being broken to support an audit finding.

Agree

We have a link to our fee schedule on our website. Would the fee schedule on our website require the additional disclosures? It is the same fee schedule that we provide at account opening.

Triggering terms for Regulation DD are APYs and bonuses. If your fee schedule does not contain either of these, then no additional disclosures are required.

Brian,

So just disclosing our OD fee, our limit of 4 OD fees per day, and our courtesy limit of $10 before we charge a OD doesn't trigger any other OD disclosures?

Brian's response to my question puzzles me a little bit since I was asking about overdraft program disclosures. Would anyone else have an opinion on my question?

I will suggest that the bare minimum disclosure requirement regarding overdraft fees spelled out in Regulation DD comment 4(b)(4)-5 is not sufficient in today's UDA(A)P environment. The pressure is on to explain when and how overdraft and NSF fees may be charged in significantly more detail than the regulation requires to avoid litigation risks and regulator citations for UDAP or UDAAP.

I am going to ask a question since this was just brought to me yesterday. Our Fee Schedule contains any and all possible fees that a customer may incur for any service (fax fee, notary fee, coin counting) along with account fees (overdraft fee, paper statement fee, ATM fees). The question was, "Can we remove the fax fee, notary fee, coin counting fee (what we are calling "in the moment fees") from the Fee Schedule since all fees that would pertain the the account being opened would be in their other account opening disclosures?

2. Other fees. Institutions need not disclose fees such as the following:

i. Fees for services offered to account and nonaccount holders alike, such as travelers checks and wire transfers (even if different amounts are charged to account and nonaccount holders).

Thanks rclarey