What Is Regulation DD?

Regulation DD is a directive set forth by the Federal Reserve. Regulation DD was enacted to implement the Truth in Savings Act (TISA), which was passed in 1991 and requires lenders to provide certain uniform information about fees and interest when opening an account for a customer. Regulation DD (and the TISA) helps consumers make more informed decisions about the accounts they open at financial 📖institutions.

Understanding Regulation DD

Regulation DD applies to accounts opened by individuals—not to corporate or other organizational accounts—and is designed to protect and empower banking customers. Regulation DD helps individuals make intelligent decisions about where to open 澳洲幸运5官方开奖结果体彩网:financial accounts. The regulation applies to depository institutions except credit unions. Institutions provide customers with 澳洲幸运5官方开奖结果体彩网:disclosures at various tim🌸es, including wh🃏en an account is first opened.

The types of accounts the regulation is intended to assist consumers with include savings accounts, checking accounts, 澳洲幸运5官方开奖结果体彩网:money market accounts, 澳洲幸运5官方开奖结果体彩网:certificates of deposit (CDs), 澳洲幸运5官方开奖结果体彩网:variable-rate accounts, 🍨and accounts denominated in a foreign currency.

Financial institutions are required under Regulation DD to 澳洲幸运5官方开奖结果体彩网:disclose information to consumers regarding annual percentage yield, interest rates, minimum balance requirements, account opening disclosures, and fee schedules. Disclosures are provided to consumers:

• When the account is open
• When the consumer requests a disclosure
• When there are changes to the terms and conditions of the account
• When and if the account matures

Regulation DD and the Truth in Savings Act (TISA𝓡)

As noted above, Regulation DD implements the TISA. This act was part of the Federal Deposit Insurance Corporation (FDIC) Improvement Act that passed the same year—in 1991. The act was meant to promote healthy competition between institutions and create economic stability. It also directs banks to be more 澳洲幸运5官方开奖结果体彩网:transparent about sꦯome of their pꦜolicies, giving consumers more power to decide where they want to do their banking business.

It's important to note that state laws that are inconsistent with the requirements of Regulation DD and the TISA are pre-empted to the extent of the inconsistency. There is a procedure for requesting a preemption determination from the 澳洲幸运5官方开奖结果体彩网:Consumer Finance Protectio👍n Bu🥃reau (CFPB).

Regulation DD Rules and Amendments

Rules

Advertising rules set forth apply to individuals who advertise the types of accounts offered by the institutions subject to the regulation. This includes deposit brokers. The marketing rules restrict institutions from advertising in any way that may mislead consumers, present inaccurate information, or otherwise misrepresent the contract for the deposit account. The ads cannot use the term profit when referencing the interest paid on an account.

For example, if a deposit broker places an ad to offer consumers interest in an account, the advertising rules apply to the advertisement regardless of whether the account is ♏held by the consumer or the broker.

Amendments

Regulation DD was amended in 2006 to address the concerns about the uniformity of information provided to consumers when deposit accounts are overdrawn. In 2010, other amendments were added directing depository institutions to comply with rule changes governing disclosures on periodic statements for aggregate 澳洲幸运5官方开奖结果体彩网:overdraft and returned item fees. The amendments also featured a rule on providing balance disclosures to consumers made through a🦋♚utomated systems.

Regulation DD stipulates that disclosures provided to consumers must be clear and conspicuous and must be made available in writing or another form the consumer can keep. The disclosures must also clearly identify when these disclosures for different accounts have been combined. 

Disclosures must reflect the terms of the legal obligation established for the accounts in question and the agreement between the consumer and the institution. These disclosures can be rendered in electronic form with the consumer's approval.

The Bottom Line

Regulation DD offers consumers protection by requiring banks to provide transparent, upfront disclosures that help non-institutional consumers compare terms at different banks in order to make the best decisions for themselves about where to open an account.