Compliance

Compliance Q&A: Regulation E

Does Regulation E require any specific wording to appear on a change-in-terms notice?

September 01, 2014
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Q: Does Regulation E require any specific wording to appear on a change-in-terms notice?

A: No. According to Regulation E’s commentary to Section 1005.8, no specific form or wording is required for a change-in-terms notice.

The notice may appear on a periodic statement, or may be given by sending a copy of a revised disclosure statement, provided attention is directed to the change (for example, in a cover letter referencing the changed term).

The credit union must provide the notice at least 21 days before the effective date of the change in terms if the institution plans to increase members’ fees or liability, provide fewer types of available electronic fund transfers, or place stricter limitations on the frequency or dollar amount of transfers.

Q: Does Reg E or Reg Z require the credit union to redeliver returned e-statement availability notices delivered via email?

A: No. The Federal Reserve Board’s 2001 interim rules on electronic disclosures under Regulations B, E, M, Z, and DD contained email delivery and redelivery requirements.

But the Fed withdrew these regulations in 2007. The current CFPB regulations don’t mandate any particular means of electronic delivery of disclosures, such as sending and resending disclosures via email. So, it’s now up to the credit union to determine how to handle undeliverable email messages.

If there are reasonable grounds to suspect that a member didn’t receive an emailed document, most credit unions follow up with the member or mail the document to the member.

Visit CUNA’s compliance blog— “CompBlog”—at cuna.org/compliance. Send questions or blog post ideas to cucomply@cuna.coop, and keep the conversation going with your peers on COBWEB, CUNA’s compliance listserv.

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