Notice: Function _load_textdomain_just_in_time was called incorrectly. Translation loading for the wp-migrate-db domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /srv/app/gotoiba-dev/htdocs/web/wp-includes/functions.php on line 6121
If we have customers who prepare tax returns and pay out tax refunds to their customers, would Regulation CC apply to the customers of the tax preparers, even though they do not have accounts with our organization? – IBA Compliance Connection

If we have customers who prepare tax returns and pay out tax refunds to their customers, would Regulation CC apply to the customers of the tax preparers, even though they do not have accounts with our organization?

by

Regulation CC would only apply to the account holder, who is the tax preparer. In the situation you have described, where customers have signed an agreement stating that they cannot make withdrawals or deposits, the customers would not be considered account holders.

The disclosure requirements and other rules in Regulation CC apply only to “customers”—a person with a bank “account” (12 CFR  229.2(tt)). Regulation CC defines “account” as a deposit that is a transaction account, generally including “accounts at a bank from which the account holder is permitted to make transfers or withdrawals.” 12 CFR  229.2(a)(1). The Regulation CC definition of “account” also specifically includes demand deposit accounts, NOW accounts, ATS accounts, and all of the transaction accounts referenced in 12 CFR 204.2(e). Id. Therefore, if a customer cannot make any transfers (payments to third parties) or withdrawals (payments directly to the depositor), the escrow account is not an “account” for purposes of Regulation CC’s disclosure and other rules.