IBA Compliance Connection

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Regarding the FDIC’s Supervisory Guidance on Multiple Re-Presentment NSF Fees, we have completed our lookback and are ready to begin issuing restitution to our customers. Do you have any samples of a notice of restitution to send to our customers? Also, we heard that the FDIC is recommending that banks provide counseling to repeat NSF offenders. Have you heard anything about this, and are there any financial literacy courses you recommend?

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Members of the IBA’s Compliance Division Advisory Committee have provided two sample notices (available in our Forms Library and linked to below) to be used in the context of providing overdraft-related restitution to customers. While neither notice specifically refers to multiple representment NSF fees, we believe they may be modified to suit your specific needs.

Additionally, the FDIC’s 2010 Overdraft Payment Supervisory Guidance states that the FDIC expects supervised institutions to “[c]onsider providing information to consumers about how to access free or low-cost financial education workshops or individualized counseling to learn how to more effectively manage personal finances.” The guidance also identifies the Federal Trade Commission’s (FTC) “Choosing a Credit Counselor” article as one resource to use, which is linked in the resources below. Members of our Compliance Division Advisory Committee also mentioned that they provide overdraft counseling by sending customers brochures and training videos once they reach a set number of overdrafts, and one committee member’s overdraft protection program vendor provides these materials.

For resources related to our guidance, please see:

  • FDIC FIL-40-2022, Supervisory Guidance on Multiple Re-Presentment NSF Fees (August 18, 2022)
  • FDIC FIL-81-2010, Overdraft Payment Supervisory Guidance, pages 2–3 (November 24, 2010) (“To mitigate safety and soundness and compliance risks, and avoid violations of related laws and regulations, the FDIC expects its supervised institutions to take the following actions regarding automated overdraft payment programs: . . . Consider providing information to consumers about how to access free or low-cost financial education workshops or individualized counseling to learn how to more effectively manage personal finances. If an institution’s community-based partners do not already provide counseling, the Federal Trade Commission’s (FTC) Choosing a Credit Counselor may be one resource to help institutions choose quality credit counseling partners.”)
  • FTC, Choosing a Credit Counselor (February 2011)