Dear Board of Directors,
- Consumer Opt In – As highlighted above, this provision requires that consumers opt in, or affirmatively consent, to the institution’s overdraft service for ATM and one-time debit card transactions, before overdraft fees may be assessed on an account.
- Opt-in/Out Notice – Prior to opting in, a consumer must be provided a notice explaining the financial institution’s overdraft services. This should include the fees associated with the service and the consumer’s choices. If institutions do not use the Fed’s sample notice, Regulation E includes language that the notice should substantially follow.
- Consumers Covered – The opt-in right applies to all consumers, including new and existing account holders.
- Revocation Option – Consumers also have an ongoing right to revoke consent after they opt in.
- Same Account Terms, Conditions and Features – Institutions must provide consumers who do not opt in with the same account terms, conditions and features -- including prices -- as consumers who do opt in.
- Prohibition from Charging Overdraft Fees for Overdrafts Paid – Institutions are prohibited from charging overdraft fees for any overdrafts they pay on ATM and one-time debit card transactions for consumers who do not opt in.
- Mandatory Compliance Dates:
July 1, 2010 – for new accounts opened after July 1, 2010
August 15, 2010 – for accounts existing before July 1, 2010
The final rule and recent clarifying amendments are available through the following links:
Final Rule: http://frwebgate3.access.gpo.gov/cgi-bin/PDFgate.cgi?WAISdocID=gdH1LZ/2/2/0&WAISaction=retrieve