New Federal Reserve rules provide important protections for the purchase and use of gift cards. The final rules under Regulation Z that implement the Credit CARD Act of 2009, restrict the fees and expiration dates applicable to gift cards and apply to gift cards sold on or after August 22, 2010.
Content on this topic has been added to The Gold Book.
Join the forum discussion on this post - (1) Posts Last month the IOLA Fund amended 21 NYCRR Section 7000.9(b)(1) to revise one of the IOLA interest rate options. Institutions may pay the greater of 60% of the Federal Funds Rate or 1% on IOLA’s. This is a change to one of the interest rate options an institution may choose for paying interest on IOLA’s, which are NOW accounts. The 1% is a floor rate.
This rate change is effective April 7, 2010. Go to www.IOLA.org, go to recent news on the right and go to the bottom and click on trustees regulations. There you will be able to pull up the 13 page regulation and find section 7000.9(a) and (b). The rates you may offer on IOLAs can be either under (a) or (b), your choice.
See the IOLA section of The Gold Book for updated material.
Join the forum discussion on this post - (1) Posts On April 13, 2010, the FDIC adopted an interim final rule extending the Transaction Account Guarantee (TAG) program through December 31, 2010 for institutions participating in the program. Institutions that wish to opt out of the TAG extension must submit a request to opt out on or before April 30, 201o.
The FDIC Board of Directors has the authority to grant an additional 12-month extension of the program, through December 31, 2011, without further rulemaking, if it determines that continuing economic difficulties warrant such extension.
The maximum interest rate limit for NOW accounts guaranteed under the TAG program will be 0.25 percent, effective July 1, 2010.
Financial institutions currently participating in the TAG program should review its disclosures and modify them as necessary to ensure that they will be accurate after June 30, 2010.
This topic is further addressed in the Standard Maximum Deposit Insurance section of The Gold Book.
Join the forum discussion on this post - (1) Posts Federal regulators released an Online Form Builder that financial institutions can download and use to develop and print customized versions of a model consumer privacy notice.
The Online Form Builder, based on the model form regulation published in the Federal Register on December 1, 2009, under the Gramm-Leach-Bliley Act, is available with several options. Easy-to-follow instructions for the form builder will guide an institution to select the version of the model form that fits its practices, such as whether the institution provides an opt-out for consumers.
To obtain a legal “safe harbor” and so satisfy the law’s disclosure requirements, institutions must follow the instructions in the model form regulation when using the Online Form Builder.
Click here for additional information including compliance requirements and dates.
Join the forum discussion on this post - (1) Posts The final rule will enable consumers to limit the costs of overdraft services by providing consumers a choice regarding their institution’s payment of overdrafts for ATM and one time debit card transactions. Consumers will also be provided a clear disclosure of the fees and terms associated with the institution’s overdraft service.
Opt-In. The final rule requires consumers to opt in, or affirmatively consent, to the institutions’ overdraft service for ATM and one time debit card transactions, before overdraft fees may be assessed on the account. The rule also provides consumers an ongoing right to revoke consent.
Consumers Covered. The opt-in right applies to all consumers, including existing account holders.
Conditioning the Opt-In. The final rule prohibits financial institutions from tying the overdraft payment of overdrafts for check and other transactions to the consumer opting into the overdraft service for ATM and one time debit card transactions.
Same Account Terms, Conditions and Features. The final rule requires institutions to provide consumers who do not opt in with the same account terms, conditions and features, including price, as provided to consumers who do opt in.
Mandatory Compliance Date. The mandatory compliance date is July 1, 2010.
The Gold Book has been updated for these new rules. See Bounce Protection and Reg E notice requirements for additional details and requirements.
Join the forum discussion on this post - (1) Posts The Federal Reserve Board has approved amendments to Appendix A of Regulation CC that reflect the restructuring of the Federal Reserve Banks’ check-processing operations.
Appendix A provides a routing symbol guide that helps depository institutions determine the maximum permissible hold periods for most deposited checks.
On February 27, 2010, the Reserve Banks will transfer the check-processing operations of the head office of the Federal Reserve Bank of Atlanta to the head office of the Federal Reserve Bank of Cleveland. To ensure that the information in Appendix A accurately describes the structure of check-processing operations within the Federal Reserve System, the final rule deletes the reference in Appendix A to the Atlanta head office and reassigns the routing numbers listed thereunder to the Cleveland head office.
To coincide with the effective date of the underlying check processing changes, the amendments are effective February 27, 2010. At that time, there will only be a single check-processing region for purposes of Regulation CC and there will no longer be any checks that are nonlocal.
Funds availability is discussed in-depth in The Gold Book.
Join the forum discussion on this post - (1) Posts Beginning January 1, 2010, the income and filing requirements for rollovers (including conversions) to a Roth IRA were eliminated. Additionally, for rollovers to a Roth IRA in 2010 only, a special 2-year option for reporting taxable portions of a rollover is available to taxpayers.
Previously, taxpayers were permitted to roll over (convert) a traditional IRA, SEP-IRA, SIMPLE IRA, and an eligible rollover distribution from an employer’s retirement plan (other than from a designated Roth account) to a Roth IRA only if the following requirements were met:
Under the new rules for 2010, regardless of income or filing status, individuals may roll over (convert) the following to a Roth IRA:
For rollovers and conversions to a Roth IRA in 2010 only, taxpayers have the option of reporting all of the taxable portion of the rollover in 2010, or reporting half in 2011 and half in 2012.
Additional information about Roth IRA Conversions and Rollovers, Qualified Rollovers and the Taxation of Roth IRA conversions may be found in The Gold Book.
Join the forum discussion on this post - (1) Posts The Financial Crimes Enforcement Network (FinCEN) is providing an educational pamphlet, “Notice to Customers: A CTR Reference Guide,” for financial institutions and their customers containing information on the currency transaction reporting (CTR) requirement. The pamphlet is provided as a resource for financial institutions to help address questions frequently asked by their customers.
For example, the pamphlet explains that large currency transactions are not illegal, and that financial institutions are required to obtain information from their customers when these transactions do occur. The pamphlet does not alter in any way a financial institution’s BSA reporting requirements and explains that if a customer attempts to break up, i.e. “structure,” transactions in order to evade the CTR reporting requirement there are potential civil and criminal consequences. In the pamphlet, FinCEN explains what constitutes structuring and provides examples of structured transactions.
The pamphlet may be found at:
http://www.fincen.gov/whatsnew/pdf/CTRPamphlet.pdf
A Spanish version of the pamphlet may be found at:
http://www.fincen.gov/whatsnew/pdf/espanal_CTRPamphlet.pdf
Information on Currency Transactions Reports is found in the Compliance chapter of The Gold Book.
Join the forum discussion on this post - (1) Posts Joint federal regulatory agencies have released a final model privacy notice form that will make it easier for consumers to understand how financial institutions collect and share information about consumers. Under the Gramm-Leach-Bliley Act (GLB Act), institutions must notify consumers of their information-sharing practices and inform consumers of their right to opt out of certain sharing practices. The model form can be used by financial institutions to comply with these requirements.
See Model Privacy Notice for details and links to model notices.
Join the forum discussion on this post - (1) Posts The Federal Reserve Board recently announced the annual indexing of the reserve requirement exemption amount and of the low reserve tranche for 2010. These amounts are used in the calculation of reserve requirements of depository institutions. The Board also announced the annual indexing of the nonexempt deposit cutoff level and the reduced reporting limit that will be used to determine deposit reporting panels effective 2010.
See sub-chapter Reserve Requirements for updated information.
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