From: Dean Thibodeau [mailto:dthibodeau@denalistatebank.com]
Sent: Tuesday, September 13, 2005 1:58 PM
To: Comments
Subject: EGRPRA Burden Reduction Comment; OCC Docket
0418; Fed Docket R-1206; OTS 2004-35
Dean Thibodeau
119 N. Cushman Street
Fairbanks, AK 99701
September 13, 2005
Comments to FDIC
Dear Comments to FDIC:
As a community banker, I support the EGRPRA project and
commend the
banking agencies for their efforts to identify outdated,
unnecessary, or
unduly burdensome regulatory requirements. I have
the following comments
concerning the regulations that are currently being
reviewed and are
categorized as Consumer Protection: Account/Deposit
Relationships and
Miscellaneous Consumer Rules.
Privacy of Consumer Financial Information
The annual privacy notice that banks must send to
customers is not only
very burdensome and costly but the language for the
notices required by
law and regulations is confusing to customers. An
optional short form
notice would be welcome, but it should replace - not
supplement - the
existing notice. Since we have already developed
processes and procedures
to comply with existing requirements, use of a short
form notice should be
at the bank's option.
Even more important, we should not have to send out an
annual notice if we
do not change our privacy policies and procedures.
We give our customers
the notice at account opening. That should be enough,
especially since we
are happy to provide information about our privacy
policy upon request.
The annual notice is particularly unnecessary for
community banks that
share information only as permitted by one of the
statutory or regulatory
exceptions.
Truth in Savings (Regulation DD)
Even though we are used to the many disclosures required
under Truth in
Savings, most of our customers pay little attention to
the disclosures.
Many of them end up in the trashcan. There is a
cost to developing the
programs and procedures to produce these disclosures,
but if consumers are
not paying attention to them, then this is a perfect
example of a needless
regulatory requirement.
The banking agencies should study whether these
disclosures are truly
serving their purpose. All interested parties
should be involved in the
study, including banks, consumers and software
providers. Regulation DD
would be an ideal regulation for streamlining and
simplification to save
banks from unnecessary costs and burdens and to improve
disclosures to our
customers.
Deposit Insurance Coverage
The FDIC has taken steps in recent years to simplify the
rules about
deposit insurance coverage, but the rules still need
simplification and
streamlining. Customers know that they can organize
accounts to expand
coverage beyond $100,000, but how that works and what
steps are needed are
confusing to both consumers and front-line bank
employees. Broader
dissemination of the tools the FDIC offers would help.
For example, the
EDIE CD-ROM should be distributed to every branch office
of every bank.
We would support simplification of the rules provided it
does not reduce
the ability of individual consumers to expand coverage,
especially since
the coverage levels have been steadily eroded by
inflation since they were
last raised in 1980.
Consumer Protection in Sales of Insurance
The disclosures required by these regulations do not fit
certain products
including credit life and related products, debt
cancellation contracts,
and crop and flood insurance. The focus of the
rule should be on
insurance products that are similar to a deposit product
and that a
consumer might confuse with a deposit that is
FDIC-insured. Bankers find
it burdensome to disclose each time they sell a customer
credit life
insurance, that credit life insurance is not a
deposit and not
FDIC-insured nor insured by any federal government
agency. They also find
it burdensome to obtain the consumer's written
acknowledgement of the
disclosures each time an insurance product or annuity is
sold.
Electronic Fund Transfers (Regulation E)
Consumer liability from unauthorized transactions
resulting from writing
the personal identification number (PIN) on a card or
keeping the PIN in
the same location as the card should be increased from
$50 to $500. It is
unfair for banks to be presumed liable in every instance
for unauthorized
electronic transactions. Furthermore, the
notification requirement under
Regulation E for a change in account terms or conditions
should be
extended from 21 days to 30 days. This would make
the notification
timeframe consistent with Regulation DD and would
simplify compliance.
Thank you for the opportunity to comment.
Sincerely,
Dean Thibodeau
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