It was a pleasure speaking to you earlier today. As we discussed, there are several regulations that might require disclosures of changes in the terms and conditions of your deposit accounts. Each regulation imposes different standards for when a bank must disclose changes, and not every change requires new disclosures, but with all of the regulations, it may be possible for your bank to make the bulk of the required disclosures electronically.
Many regulations expressly state that the disclosures can be made electronically if you meet the requirements of the Electronic Signatures in Global and National Commerce Act (E-SIGN Act). In addition, the E-Sign Act authorizes legally required notices to be sent in electronic form even when a regulation does not expressly authorize electronic disclosures, provided that the E-SIGN Act’s requirements are met (such as obtaining the consumer’s consent and testing the electronic notices). 15 USC 7001. The Federal Reserve provides a checklist to assist in compliance with the E-SIGN Act. Consumer Affairs Electronic Banking Checklist (p. 7) (May 2003).
Specifically, as to your question, below is a summary of the federal regulations that are pertinent to disclosures of changes in terms for deposit accounts:
Regulation CC’s Disclosure Requirements
If a change is made to your funds availability policy, you should notify your consumer account customers at least thirty days before implementing the change (unless the change expedites the availability of funds, in which case you can notify customers within thirty days after the implementation). 12 CFR 229.18(e).
The Official Staff Commentary to Regulation CC expressly states that these disclosures can be made electronically if you comply with the E-SIGN Act requirements. Comment 1, Official Staff Commentary, 12 CFR 229.15(a).
Regulation E’s Disclosure Requirements
Regulation E, 12 CFR 1005.8(a), requires a change-in-terms notice at least twenty-one days before any changes that result in:
(i) Increased fees for the consumer;
(ii) Increased liability for the consumer;
(iii) Fewer types of available electronic fund transfers; or
(iv) Stricter limitations on the frequency or dollar amount of transfers.
Regulation E expressly states that disclosures can be made electronically if you comply with the E-SIGN Act requirements. 12 CFR 1005.4(a)(1).
Regulation P’s Disclosure Requirements
Regulation P requires a new privacy notice and opt-out form if there are changes to your privacy notice that would allow you to “disclose any nonpublic personal information about a consumer to a nonaffiliated third party other than as described in the initial notice.” 12 CFR 1016.8(a).
Regulation E is silent on electronic disclosures, but the general E-SIGN Act rule discussed above authorizes you to make these disclosures electronically if you comply with the E-SIGN Act requirements.
Regulation DD’s Disclosure Requirements
Regulation DD requires a change-in-terms notice if changes “may reduce the annual percentage yield or adversely affect the consumer.” 12 CFR 1030.5(a).
Note, however, that no notices are required for the following: (i) variable-rate changes (changes in the interest rate and corresponding changes in the annual percentage yield in variable-rate accounts, (ii) check printing fees (changes in fees assessed for check printing), and (iii) short-term time accounts (changes in any term for time accounts with maturities of one month or less).
Regulation DD expressly provides that its required disclosures can be made electronically if you comply with the E-SIGN Act requirements. 12 CFR 1030.3(a).