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CUNA Regulatory Comment Call

August 7, 2001

EXECUTIVE SUMMARY

• On March 30 and April 4, 2001, the Federal Reserve Board (Fed) issued interim final rules on how financial institutions and others can provide electronically the disclosures that are required to be given in writing under Regulation Z (the Truth in Lending Act), Regulation B (the Equal Credit Opportunity Act), Regulation E (the Electronic Fund Transfer Act), Regulation M (the Consumer Leasing Act), and Regulation DD (the Truth in Savings Act).
• The Fed had established October 1, 2001 as the mandatory compliance date. The Fed has now delayed this date. A new mandatory compliance date will be set when the final rules are issued, and the Fed intends to provide financial institutions with a reasonable period of time to comply with these rules. Click here for more information.
• The Fed has delayed the mandatory compliance date in order to address the concerns of CUNA and others and to consider adjustments to the rule to provide additional flexibility. CUNA's primary concern is the prohibition of the use of electronic messages through home banking programs as a means of complying with the provisions that require e-mail notifications. CUNA outlined this concern in comment letters that were submitted to the Fed in June and in a subsequent meeting with Fed staff. The Fed has cited this issue as a significant reason for the delay and possible adjustments to these rules. Click here for copies of CUNA's comment letters.
  

• For more information about the Fed's interim final rules, click here for CUNA's Regulatory Comment Calls.
• The delay in the mandatory compliance date does not delay or prohibit the use of electronic disclosures. The Electronic Signatures in Global and National Commerce Act, which became effective on October 1, 2000, permits the use of electronic signatures and disclosures, as long as appropriate consent is received from the consumer. The Fed's rules are intended to provide guidance regarding the timing and delivery of these disclosures. Until final rules are issued, credit unions may continue to provide electronic disclosures under their existing policies and practices or may follow the Fed's interim final rules.
• In 1998 and 1999, the Fed issued interim final rules regarding the electronic delivery of the disclosures required under Regulations E and DD. The Fed withdrew these rules when it issued the new interim final rules in March and April of this year. The delay of the mandatory compliance date does not affect the withdrawal of the 1998 and 1999 interim final rules.
• The interim final rules issued in March and April revised Regulations B, E, and Z to permit disclosures in languages other than English, as long as disclosures in English are also available upon request. The delay in the mandatory compliance date will have no effect on these provisions.