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Lagniappe - A Little Something Extra

By Cindy LeBlanc, CRCM 14 Mar 2018

The community I grew up in Southern Louisiana was a fun loving, family oriented group where neighbors are treated as family. We always choose to offer something a little extra to our neighbors and that little something extra is called Lagniappe.


This week I wanted to offer a little something extra by addressing some of the more common questions we have received lately on various regulatory topics:


Reg CC - With the July 1, 2018 changes, will remote deposited items (RDC) be included in the Funds Availability rules?

Answer - No, an RDC will not be included in the Funds Availability section of Regulation CC. Although a RDC is now defined as an electronic check (because it starts its journey as a paper item) under the July 1 changes, a RDC will not be subject to Subpart B - Funds Availability. You will continue to address the availability of those RDC's within the institution's RDC agreement with your customer. The RDC items will, however, be subject to Subpart C - Collection of Checks.


Beneficial Ownership Signage - We have been receiving alerts from various forms vendors that we must update our CIP lobby notice for the new Beneficial Ownership rule. Is this something we are required to do?

Answer - No, you are not required to update the CIP lobby notice to reflect the changes with the Beneficial Ownership rule. There is nothing in the new rule that requires that you alter the existing lobby notice or states that you must purchase an additional one. There is a certification form in Appendix A of the rule, but the new rule does not require that you make changes to the existing lobby notice or begin using a new one just for the Beneficial Ownership rule.


Regulation D - Do automatic transfers from a savings or money market account at our institution to make a loan payment at our institution count as one of the 6 limited transactions?

Answer - Automatic transfers from a savings or money market account to a loan account at the same institution do not count towards one of the 6 limited transactions. 12 CFR 204.2(d)(2) states that, "Such an account is not a transaction account by virtue of an arrangement that permits transfers for the purpose of repaying loans and associated expenses at the same depository institution (as originator or servicer)..."


Flood - I am renewing a loan and using a Flood determination that I pulled 4 years ago. There have been no map changes, the existing determination is within 7 years, the existing determination was completed on the SFHD form and my institution is the original lender. The borrower currently has a flood policy in place. Do I have to resend the notice to the borrower since they already have flood insurance?

Answer - You are required to send a new flood notice to the borrower. Although, the regulation allows you to reuse an existing determination as long as the 4 criteria are met, you are still required to send the notice and obtain proof of delivery. The 4 criteria are: the determination cannot be older than 7 years; the institution using the existing determination must be the institution that pulled it; the determination must be on a SFHD form and there must not be any changes to the flood maps in relation to the property.


That's your "little something extra" for this week. If you haven't signed up for the 2018 Temenos Educational Conference held April 23 - 25, consider doing so. We will be offering more Lagniappe with our sessions to keep you up to date on regulatory changes.

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