Exception holds and record retention requirements

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Question:

Under Reg CC, we must notify a customer in writing of any exception holds placed on their account within 24 hours of the deposit. It is a good quality control policy to test procedures to ensure it is being done, but are there any regulations that require us to keep a list of which accounts or checks received an exception hold?

Answer:

You aren’t required to keep a record of all the exception holds your bank places, but there is a requirement that you keep a record for at least two years of each notice involving the “reasonable cause” exception under 229.13(e), along with a brief list of facts “giving rise to the bank’s reason to doubt the collectability of the check.”
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