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Is there a record retention requirement for deposit account denials? When any potential customer asks to open a deposit account, we use an account screening service to determine whether to open the account. If we deny an account based on that screening, we provide the customer with our adverse action notification on the spot. Do we have to retain that notice? If so, for how long? – IBA Compliance Connection

IBA Compliance Connection

Your go to source for compliance!

Is there a record retention requirement for deposit account denials? When any potential customer asks to open a deposit account, we use an account screening service to determine whether to open the account. If we deny an account based on that screening, we provide the customer with our adverse action notification on the spot. Do we have to retain that notice? If so, for how long?

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We are not aware of any record retention requirement for deposit account denials. However, you may wish to follow the same record retention requirements in Regulation B regarding adverse action notices for credit applications. Under Regulation B, adverse action notices regarding credit applications must be retained for 25 months for consumers and 12 months for businesses. In any event, your bank’s written record retention policy should address this scenario, and you should apply that policy consistently.

For resources related to our guidance, please see:

  • Regulation B, 12 CFR 1002.12(b)(1)(ii) (“For 25 months (12 months for business credit, except as provided in paragraph (b)(5) of this section) after the date that a creditor notifies an applicant of action taken on an application or of incompleteness, the creditor shall retain in original form or a copy thereof . . . the notification of action taken; and the statement of specific reasons for adverse action . . . .”)