Fee disclosed but never charged, now charging

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    We have a fee listed in our deposit disclosure booklet called ACH revocation/stop payment. We have never charged the fee for ACH revocations before but we have always charged for the stop payment. We now would like to start charging the fee for the revocations. The fee would be listed on the statement as “ACH revocation”. Our CSRs are to inform the customer that we will now be charging $30 for the revocation at the time they are filling out the form.

    Since the fee has already been disclosed in our disclosure booklet, do we need to notify our customers 30 days prior to charging the fee? Is this merely a customer service issue where it would be nice to tell them ahead of time or is there a regulatory issue as well?
    Is this a UDAAP issue?


    Typically if you are disclosing the fee at account opening then there is no requirement to give additional notice before charging such a fee. This case is a bit different as the Bank may have created a sense that it doesn’t charge the fee. I don’t believe there is a regulatory requirement that would require you to give the 30 day notice, but by doing so it would be a good customer service move and would give you a pretty good argument about it not being a UDAAP issue.

    In the regulatory environment that we are in know, I could see this potentially being spun into a UDAAP issue. I like where you are headed with the 30 day notice, and that does sound like the safest route to go.

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