CU Trades Raise Concerns About Overdraft Rules
Credit unions shouldn't have to use the phrase "total overdraft fees," on their statements when describing how much a member has to pay for overdrafts, CUNA and NAFCU told the NCUA.
CUNA Senior Assistant General Counsel Jeffrey Bloch wrote that credit unions should have the option to classify the payments under the category of "Total Overdraft Fees for Paid Items." He explained that allowing this distinction will differentiate between paid overdraft items and items that are returned unpaid.
NAFCU Associate Director of Regulatory Affairs Dillon Shea didn't recommend specific alternative language but urged the agency to allow credit unions to use language that is consistent with "terminology used in account opening and in other marketing and promotional material."
Bloch and Shea were commenting on interim final rules issued by the agency that implement changes to the Truth in Savings Act that were approved by the agency and the Federal Reserve.
Bloch also asked the agency to use the original sample disclosure form on overdraft fees rather than the revised form.
He wrote that the changes would require credit unions to reformat their disclosure forms and would "impose additional burdens on credit unions," and not have a major impact on the information that credit unions are providing to their members.
Shea wrote that the agency should provide credit unions additional guidance on how they should disclose fees. Specifically, he asked for clarification on whether credit unions would have to provide information in a tabular format. He notes that the regulation doesn't require that format but the sample forms cite that as the best way to convey the information.
He requested the agency authorize that disclosures can be made without tables as long as "the disclosures are still clear and conspicuous."