In July 2019, the Consumer Financial Protection Bureau and the Federal Reserve Board published a final rule on inflation-based adjustments to the dollar amounts under Regulation CC. As a reminder, the increased dollar amounts become effective July 1, 2020.
The Dodd-Frank Act requires adjustments every five years, calculated by the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers.
The inflation adjustments are going to change four of the main funds availability requirements:
- $200 is changing to $225 for check deposits not subject to next-day availability (note that the $200 amount is referred to as $100 in Regulation CC);
- $5,000 is changing to $5,525 for special exception holds, which includes but is not limited to large deposits, new account holds, and repeatedly overdrawn accounts;
- $400 is changing to $450 for extended holds for one business day when a check deposit is taken for withdrawal by cash or similar means; and
- Civil liability is changing from $1,000 for an individual action and $500,000 for a class action to $1,100 and $552,500, respectively.
Remember that Regulation CC requires financial institutions to provide consumers with at least a 30-day notice before implementing any change to their funds availability policies, except that any change which would expedite the availability of funds may be disclosed no later than 30 days after implementation.
Lastly, remember to update your institution’s policies and procedures, account disclosures, hold notices, and any lobby notices.
As always, we will keep you apprised of other regulatory changes as they become effective.