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Reg E - Handling Consecutive OD Fees

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Question: 
How are banks and servicers handling a consecutive overdraft fee? For example, if the account has been overdrawn for more than five consecutive days, the account will be charged a $10 overdraft fee on a daily basis until it goes positive. How will the bank/servicer manage the consecutive overdraft fee when the item creating or perpetuating the overdraft balance was an ATM withdrawal or one time debit card transaction on an account that did not opt-in?
Answer: 

It seems that the only option would be that the system would have to be able to track what type of transaction caused the continuing overdraft. If it was an ATM withdrawal or one time debit card transaction and the customer has not opted-in, the charge would be in violation of the new Reg. E provisions.

First published on BankersOnline.com 2/08/10

First published on 02/08/2010

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