If we target Japanese customers to open accounts and we place advertisments all in the Japanese language should we provide the Reg DD disclosures in Japanese?

Under the commentary of Reg. DD disclosures need to be “presented in a format that allows consumers to readily understand the terms of their account.” It seems that we would not be complying with the above comment (as well as the intent of the regulation) if we provide disclosures written in English to Japanese customers who we know do not read or speak English.

Unless you have a state law that requires you to provide disclosures in a language that you use in advertising, you are always in compliance with the federal disclosure rules if you use English (assuming accuracy of content, of course).

As one of the more "recent" regulations, DD acknowledges political correctness:

(b) General. The disclosures shall reflect the terms of the legal obligation of the account agreement between the consumer and the depository institution. Disclosures may be made in languages other than English, provided the disclosures are available in English upon request.

The issue is discussed more frequently in terms of disclosures in Spanish, but the conclusion is always the same: You may, but are not required to provide disclosures in a language the customer can actually read. It seems a little silly to conclude that a consumer is "protected" by a piece of paper he or she cannot read. On the other hand, consider the effect if the law required that disclosures be provided in the customer's native language...

My guess is that your Japanese speaking customers will derive exactly the same amount of value from your disclosures as your English speaking customers do.

As John notes, there may be state law pronouncements. California is always a fertile field...

Thanks for the responses, still the commentary says that we should provide disclosures in a format so that customers can understand the terms of their accounts, also the purpose/intent of the regulation is to enable consumers to make informed decisions about accounts at depository institutions by requiring depository institutions to provide disclosures so that consumers can make meaningful comparisons.

I understand that TISA does not require disclosures to be in other languages, but based on our approach to solicit customers using japanaese advertisements, how would we meet the regulation's purpose/intent and comply with the commentary if we solicit/advertise to customers in Japanese and yet provide them with required disclosures in English which they would not understand. If they were to advertise in English I would be fine.

I agree, you may advertise in Japanese. Ken's point is well taken. His other point -- that you'll probably do no better at "educating" your customer than if you printed the disclosures in English -- is also valid, I think.

For whatever it's worth, it's also my observation that a lot higher percentage of Japanese individuals can read and understand English than Americans can read and understand Japanese.

Thanks John. We came up with a compromise and our product development team will inform customers that the rules and disclosure booklets are in english and that they should call if they need explanation or ask someone in Japan to assist with interpreting.

I totally agree with Kens's point; printing the dislosures in Japanese would no better educate customers, still barring our above solution, it alleviates us from defending the arguement that a customer did not understand the dislosures because of a language barrier.