Forgo Written Notice for Case-by-Case Holds?

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Question:

We have a case-by-case hold policy at the bank where I work. We give a written hold notice to customers when we are placing a hold on their deposits. We have one customer who makes multiple deposits each week. Due to the history on the account, we place a hold on all check deposits into this account. The customer is aware of this. Are we permitted to forgo the written notice step of the case-by-case hold for this customer?

Answer:

You may find some help in Comment 229.16(a)-2:

The disclosure must reflect the policy and practice of the bank regarding availability as to most accounts and most deposits into those accounts. In disclosing the availability policy that it follows in most cases, a bank may provide a single disclosure that reflects one policy to all its transaction account customers, even though some of its customers may receive faster availability than that reflected in the policy disclosure. Thus, a bank need not disclose to some customers that they receive faster availability than indicated in the disclosure. If, however, a bank has a policy of imposing delays in availability on any customers longer than those specified in its disclosure, those customers must receive disclosures that reflect the longer applicable availability periods. A bank may establish different availability policies for different groups of customers, such as customers in a particular geographic area or customers of a particular branch. For purposes of providing a specific availability policy, the bank may allocate customers among groups through good faith use of a reasonable method. A bank may also establish different availability policies for deposits at different locations, such as deposits at a contractual branch.

The portion in bold is what I'd focus on, and it appears to allow a separate availability policy for a group of customers. It goes on to suggest that groups might be related to geography or branch assignment. It doesn't provide explicitly for a group based on account history, and there is a separate allusion to account history in Section 229.13 where exception holds for customers with excessive overdrafts are described.

If you determine that the Comment would permit you to have a separate availability policy for a group of customers with a history of particular account problems, you could adopt and disclose to that group a policy that would automatically assign second-business-day availability to all except next-day items.

I'd tread lightly there, though, if you're singling out one customer for this treatment. It's hard to justify creating a "group of one."

First published on BankersOnline.com 10/29/12