Where are we on the subject of bank overdraft programs? The Bureau has studied the topic almost since it opened its doors in 2011. After a flurry of activity during the Cordray years, the Bureau moved its overdraft project to an “inactive list.” The OCC had a “toe in the water” for a time but backed away from the topic during the previous administration. In the meantime, regulators have identified selected overdraft practices as targets for UDAP or UDAAP charges.
In 2021, several credit unions began announcing they were reducing or eliminating overdraft fees. Capital One, the sixth largest retail bank in the U.S., announced on December 1 it will be eliminating overdraft and non-sufficient funds fees on consumer accounts, and will offer free overdraft protection to consumers, starting in 2022. Elsewhere, everything points to making sure banks are transparent in their provision of overdraft services and avoid consumer harm in efforts to increase overdraft fee income.
With a new Director, the CFPB shows signs of targeting overdrafts yet again. On December 1, 2021, the Bureau released two reports on bank and credit union overdraft practices and fees and the degree to which these fees have been relied upon while net interest margins been so sparse.
Attend this two-hour webinar to get a current view of regulatory requirements and developments affecting overdraft programs, including --
- What the CFPB is focused on in its recent reviews of OD practices
- A review of the account disclosure requirements related to overdraft fees
- The dangers of relying on § 1030.4(b)(4) and comment (b)(4)(5).
- A cautious look at Regulation DD account advertising requirements when overdrafts are mentioned
- Statement disclosure requirements
- The opt-in disclosure requirements under Regulation E
- Regs E and O – Does “no opt-in, no fee” apply to insiders, too?
- Key provisions of the FDIC’s 2010 Guidance and the follow-up FAQ
- The FDIC's OD fees/Reg E/UDAP stance and what it means to you
- Best practices and practices to avoid
- Recent court cases and regulatory enforcement actions involving overdraft payment programs