Answer:
A literal read of the regulation puts it fairly simply. While it would be prudent to send the notice to the owners of all accounts with card access, the basic requirement is that you just cannot assess an overdraft fee for a covered card transaction if you have not sent a notice to, received an opt-in from, and provided a confirmation to, the customer. If you are able to shut off overdraft fee assessments for covered card transactions in accounts without an opt-in effective 8/15/10, you won't have to send the notice.
One cautionary note, however. The regulators, particularly the OTS, are not likely to look kindly on any segmented marketing program that both targets groups who have been frequent users of overdraft services and markets the account or overdraft service in a manner that leaves the impression that they are designed to avoid future financial challenges, particularly if the overdraft fees are not clearly explained. The OTS recently published proposed Supplemental Guidance on Overdraft Protection Programs. While the proposal isn't yet finalized, it does reflect the OTS's current thinking, and it's possible other agencies will take similar views.
First published on BankersOnline.com 5/17/10
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