I'm quickly beginning to HATE Check 21!

Regarding 229.54(d)(3) - Overdrafts:

It states that if the delayed availability is used in accordance with the safeguard exceptions for expedited recredit, no overdraft fees may be assessed until the 5th calendar day after the recredit (which isn't available anyway). So, if I understand this correctly, we must notify the customer when the recredit has been made (although it isn't available), AND we can't assess overdraft fees for 5 days on itmes drawn against the recredited funds (which aren't available). This doesn't make much sense, but that seems to be what it says. Is this right?

I believe you are correct. On 8-27th I questioned how bankers were going to handle this operationally and got little response. Since then, I think we decided if we place an exception hold on recredited funds we will put them in a special hold area that is displayed on reports. So, I think that when we are making our return and fee decisions, we can look and see if there are any recredited funds being held. I really need to think about this some more!! Anybody have ideas?

I think the bottom line is that you are going to want to expeditiously investigate the claim and be in a position to only recredit in instances where you feel fairly certain the claim is going to be determined to be valid. That means acting quickly, once you receive the claim from your customer so you can be done with your assessment by the end of the 10th business day. I realize that won't always be feasible. The need to delay availability won't be great when it's a final recredit: it's when it's provisional and you're concerned about ever being able to get the funds back that it will be a big deal and you may want to hunt around for a possible safeguard exception that could be applicable.