The practice of charging multiple NSF fees on represented items has been a huge deal lately for FDIC-regulated banks. We have put out several blogs in the last couple of months, wrote about it in our Magazine, and it was a hot topic session during our recent Virtual Deposit Conference.
Many banks have been doing this for years, and while the regulations haven’t changed, interpretations and perceptions have. At this point, the FDIC has been the only regulator to issue guidance (FIL-40-2022), including lookbacks and restitution. It was also addressed in their March 2022 Supervisory Highlights.
We recently heard some feedback from a few of our FDIC-regulated clients and wanted to pass it along. Specifically, some client banks were told that if they do a two-year lookback on their own and provide restitution (if necessary), examiners won’t look at this any further. However, examiners will require a five-year lookback if the bank does not do anything or isn’t very far along in its lookback process.
Again, this is feedback from just a few of our clients, and you may still want to confirm with your examiners to be sure.
Published
2022/11/17
