Effective 2/27, the Federal Reserve Board (Fed) consolidated all its check-processing operations into Cleveland, Ohio. This action eliminates all "nonlocal checks" under Regulation CC, which implements the Expedited Funds Availability Act. Reg CC governs when credit unions must make funds available that are deposited into share draft/checking accounts and what disclosure they must make about their check-hold policies. Credit unions have been working to update their Funds Availability Disclosure, adjust their policies, procedures and training materials to reflect the changes. Credit unions should also ensure that lobby and teller window signs are up-to-date as well as any marketing materials or check schedules that may be provided to members.
Reg CC says that depository institutions have to provide notice to existing affected account holders, should you change your disclosures, within 30 days after funds availability changes became effective, so no later than 3/29. With the elimination of "non-local checks," the 5th business-day availability rule now only covers cash and checks deposited into ATMs not owned by the credit union. Next-day availability rules remain unchanged, as do the rules applicable to government checks and cashier, tellers and certified checks. Extended holds are limited to a maximum of 7 days.
All other "local" checks are now generally subject to second-business-day availability, unless the credit union imposes one of six exceptions still allowed under Regulation CC. To help credit unions understand the rules, here are some new resources:
- Regulation CC: A Refresher provided by CUNA highlights include what has changed and reminds credit unions what they should review right now for Reg CC compliance
- CUNA’s eGuide to Federal Laws and Regulations/Regulation CC provides is an updated summary of Reg CC requirements
- Regulation CC – Funds Availability Chart created by the Massachusetts Credit Union League
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