I am looking at an overdraft privilege/bounce protection type product that appears to adhere to all of the best practices and will be in compliance with the TISA requirements effective 7/1/06.

An informative initial disclosure is given that clearly explains the program and says that alterative products are also available. Any customer who uses ODP and has a negative balance outstanding for 30 days or more is no longer eligible for the program.

All that said, my question pertains to monitoring account usage. To what extent is the bank expected to proactively tell regular users of ODP of alternatives? What if there are a number of customers racking up thousands in annual ODP fees that promptly bring their balance positive? These customers remain eligible to participate (OD balances cleared within 30 days), but at what point is the bank expected to discuss alternatives with them?

Will simply disclosing the MTD/YTD fees on the statements effective 7/1/06 help bring home the point to these customers how much they are actually paying for this service?

As for your last question, will the aggregate fee disclosures affect consumer behavior, I don't think so. In my opinion, we are talking about people who do not open their bank statements anyway. If I'm wrong, I will be pleased. In any case, those disclosures won't be the substitute for the monitoring that the Guidance suggests.

In terms of monitoring for "excessive" use, you and I might have different opinions on what that means. So might Examiner A and Examiner B. Personally, I would not attempt a "Karnack the Magnificent" demonstration and attempt to anticipate the individual desires of examiners. I would wait until they were presented to me, if they are presented at all.

Off the top of my head, at year end I would look for customers whose NSF fees exceeded $1,000 for any given calendar year. I would send them the Fed's brochure edited to delete the part about contacting their regulatory agency to complain. (As I've said before, they are not overdrawn becasue of anything the bank did and connecting overdrafts with regulatory complaints showed some naivete on the part of those who wrote the brochure.)

The guidance suggests that consumers be informed of available options. That's sort of the equivalent of "Let them eat cake." The options available are generally reliant on some form of discipline and self restraint, traits markedly lacking in someone paying $1,000 a year in NSF fees. Yet, the bank could develop a brochure combining the unbiased information in the Fed brochure and a discussion of its alternative products to distribute to this select group. Alternatively, they could distribute it to all customers.

Under no circumstances would I write a personalized letter encouraging people to come in for some form of financial counseling. There are easier ways to get someone to call you and tell you to "Mind your own business."

[To all comers, responding to this portion of the Guidance is an exercise in subjectivity, as indicated above. This forum rises to its highest level when people critique and offer alternatives to subjective judgments. Have at it.]