Regulatory Questions: Regulation DD and E
Are Banks Required to list the interest rate along with the annual percentage yield (APY) paid on a deposit account on the rate sheet provided to consumer at account opening?
No, if the rate sheet is being used to comply with the account opening disclosures of Regulation DD (Truth in Savings Act).
Yes, if the bank is using the rate sheet solely for advertising purposes. Interest rate information is required in Regulation DD disclosures but not advertisements.
Reference: Regulation DD; 1030.4(b)(1))
Consumer disputes concerning online bill payment. Does Regulation E (Electronic Funds Transfer) cover such disputes? In particular where the bill-pay vendor generated a check or draft instead of sending an electronic payment. Should the Bank follow the Regulation E dispute process and timeframes for all online bill-payments?
Generally, Yes, Regulation E and its dispute provisions cover payments made though on-line bill-payment services, even if those payments will actually be paid by check unless “the terms of the bill-payment service explicitly state that all payments, or all payments to a particular payee or payees, will solely by check, drafts, or similar paper instruments. Also, the payee or payees that will be paid in this manner are identified to the consumer.”
Reference: Regulation E; See comment 1vi to 1005.3(b))1))
Regulatory Changes Update: Real Estate Appraisals
The federal banking regulators (FDIC, FRB & OCC) have finalized several changes to their rules dealing with real estate appraisals.
- General Exemption Amount: The existing appraisal exemption threshold amount for residential real estate transactions have been increased from $250,000 to $400,000.
- Rural Property Exemption: A new exemption has been added; an evaluation of the property collateral may be used instead of an appraisal for these instances. The $400,000 value will apply.
- USPAP Compliance: Institutions will continue to be required to subject appraisals to appropriate review for compliance under the Uniform Standards of Professional Appraisal Practice (USPAP).
Emerging Issue: H.R. 4813; Keep Big Tech Out of Finance Act
10/23/19 – Introduced in the House by Jesus G. “Chuy” Garcia
- Would prohibit large tech companies from offering digital currencies.
- Would block Facebook’s contemplated new digital currency known as “Libra”.
- Would prohibit large platform utilities from being “affiliated” with financial institutions.
- Would empower federal financial regulators to assess fines up to $1 million per day for violations of the statue.