We are looking to offer an internal sweep account for a large corporate customer. Funds in excess of $100,000 will be swept each day from a checking account to a MMDA per signed agreement with the customer. The sweeps will not be done automatically; instead, they will be performed by a teller after reviewing collected/uncollected balance information each morning. Because the transactions will be performed by a teller, would they be excluded from the six transaction/month limitations? Thanks for any comments/insight!

No.

The funds are being deposited into the money market account so it is a credit and you need not worry about the number of these transactions. It is the flip side where you have the money market balance sweeping to the checking (operation) account that you need to be worried about.

Many banks such as ours offer this service, you will need to review each account individually and determine a weekly operating balance to maintain at a minimum in the checking account so that ultimately you only need to pull from the money market weekly and not exceeding more than 6 in a month. Hope this helps.

You are taking money from checking to money market (credit). Therefore, you need not worry about the number of these transactions. However, it is the flip-side that you need to be concernced with if you are transferring funds from money market to checking (operational) account.

Many banks such as ours offer this service. You need to review each account individually and set an approx weekly balance in checking account so that if you are pulling from money market to operational account ultimately you will transfer only on a weekly basis and not exceed more than 6 transactions.

You can also look to some type of repo arrangement if you need to sweep daily to maximize investment earnings.

Thanks for the comments. So is it the fact that the transfers from the MMDA to checking are occurring under a "preauthorized agreement" and not being requested in person by the account holder that trumps the fact that the transfers are being performed by a teller?

"So is it the fact that the transfers from the MMDA to checking are occurring under a "preauthorized agreement" and not being requested in person by the account holder that trumps the fact that the transfers are being performed by a teller? "

That is true.

Keep remembering the seat of the pants rule. If the transaction can be completed without the customer getting the seat of his pants off his chair at home or at the office, it will almost ALWAYS count toward one or both of the Regulation D savings account transfer limits.

If the MMDA account is backed by securities (not FDIC insured)can there be unlimited sweeps to a checking account from the MMDA account?

An MMDA is a deposit account, insured by the FDIC if it's in an insured institution. You can't have an uninsured deposit account in an FDIC-member bank.

If what you're describing is a non-deposit investment vehicle, such as a repurchase agreement ("repo") or some other form of investment, that's a different matter.

A repo agreement is what I think I should be describing. We recently implemented charging a fee for an excessive transaction and I heard thru the grapevine that there are some issues with our sweep accounts. I will have to check into it but I suspect we are charging a fee on those accounts that are set up as repurchase agreements.