Wire Transfers and Regulation D

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Question:

The "Wire Transfers and Reg D" question and response regarding whether or not outgoing wire transfers count in the Reg D limits was first published on 12/1/03. In that response, it was noted "if the request is presented at the bank in person or by customer-hired messenger (or other agent of the customer), it need not be counted under Reg D requirements." For clarification purposes, if an outgoing wire transfer is presented at the bank in person and the beneficiary of the wire is a third party, does the "third party" feature trump the "in person" transaction, making the transfer count in the Reg D limits?

Answer:

In the previous response, I relied on the following portion of the savings account definition in Regulation D, section 204.2(d)(2):

"... the depositor is permitted or authorized to make no more than six transfers and withdrawals, or a combination of such transfers and withdrawals, per calendar month or statement cycle (or similar period) of at least four weeks, to another account (including a transaction account) of the depositor at the same institution or to a third party by means of a preauthorized or automatic transfer, or telephonic (including data transmission) agreement, order or instruction, and no more than three of the six such transfers may be made by check, draft, debit card, or similar order made by the depositor and payable to third parties." [Emphasis added]

Read through that statement of the transfer and withdrawal limits and you will see no mention of withdrawals or transfers made in person. Two sentences later in the definition, transactions made in person or by messenger are mentioned, but that portion of the rule only clarifies the section quoted above, so rather than suggesting that the involvement of a "third party" transferee trumps the "in person" exception, I believe that "in person" trumps any restriction in the regulation.

[Editors Note: As of 7/2/09, the separate limit of three per month for checks, POS debit card transactions, etc., has been eliminated, and those transactions are now only subject to the 6/month limit that applies to other restricted transfers and withdrawals.]

First published on BankersOnline.com 9/24/07