|
The Expedited Funds Availability Act (EFA or EFAA) was enacted in 1987 by the United States Congress for the purpose of standardizing hold periods on deposits made to commercial banks and to regulate institutions' use of deposit holds. It is also referred to as Regulation CC or Reg CC, after the Federal Reserve regulation that implements the act. The law is codified in Title 12, Chapter 40 of the US Code and Title 12, Part 229 of the Code of Federal Regulations[1]. Congress in Joint Session. ...
Deposit may refer to: Finance A deposit is a specific sum of money taken and held on account, by a bank as a service provided for its clients. ...
A commercial bank is a type of financial intermediary and a type of bank. ...
The Federal Reserve System is headquartered in the Eccles Building on Constitution Avenue in Washington, DC. The Federal Reserve System (also the Federal Reserve; informally The Fed) is the central banking system of the United States. ...
The United States Code (U.S.C.) is a compilation and codification of the general and permanent federal Law of the United States. ...
The United States Code of Federal Regulations (CFR) is the codification of the general and permanent rules and regulations published in the Federal Register by the executive departments and agencies of the Federal Government. ...
Provisions
The EFAA provides for uniform hold periods and funds availability policies that must be implimented by all FDIC-insured depository institutions, as well as those who are members of the National Credit Union Share Insurance Fund, or of the Federal Reserve System. The Federal Deposit Insurance Corporation (FDIC) was created by the Glass-Steagall Act of 1933. ...
The Federal Reserve System is headquartered in the Eccles Building on Constitution Avenue in Washington, DC. The Federal Reserve System (also the Federal Reserve; informally The Fed) is the central bank of the United States. ...
Next-Day and Second-Day Availability Under the act, certain types of deposits must be given "next-day availability," meaning that the proceeds of the transaction are available for withdrawal on the next business day. Items subject to next-day availability are: - Cash deposits;
- Electronic payments;
- Certain check deposits, including:
In order for these items to be subject to next-day availability, they must be deposited in person to an employee of the depositary bank, and checks must be deposited into an account in the name of the payee listed on the item. In the case of deposits not made in person to a bank employee, these items are subject to second-day availability, and must be made available on the second business day following the receipt of the deposit. The United States Department of the Treasury is a Cabinet department, a treasury, of the United States government established by an Act of U.S. Congress in 1789 to manage the revenue of the United States government. ...
// Money Order in the U.S. In the United States, a money order is a type of check intended to provide a safe alternative to sending cash (in the mail). ...
A USPS logo A USPS truck in San Francisco A smaller truck (a Long Life Vehicle or LLV) used in suburban areas The United States Postal Service (USPS) is an independent establishment of the executive branch of the United States government (see 39 USC § 201) responsible for providing postal service...
Federal Reserve Districts The United States Federal Reserve System consists of twelve Federal Reserve Banks, each responsible for a particular district, and some with branches. ...
The Federal Home Loan Banks are an essential source of stable, low-cost funds to financial institutions for home mortgage, small business, rural and agricultural loans. ...
A estate transfers, tax payments and the like. ...
This page is a candidate for speedy deletion, because: it contains no useful content If you disagree with its speedy deletion, please explain why on its talk page or at Wikipedia:Speedy deletions. ...
A cashiers check (also known as a treasurers check, bank check, or tellers check) is a check issued by a bank on its own account for the amount paid to the bank by the purchaser with a named payee, and stating the name of the party purchasing...
In order to make Cashier's, Certified, and Teller's checks, as well as state and local government checks, available on the next business day, banks may require that customers fill out a special deposit slip, in accordance with 12 CFR 229.10(c)(3), and depositary institutions are required to make these slips readily and easily available to customers.
Local and Non-local Checks When determining the applicable hold periods under Reg CC, transit checks (not-on-us checks) are categorized as being "local" or "non-local," based on the Federal Reserve district in which the depositary institution and the drawee bank are located. A transit check or not on-us check is a negotiable item (check) which is drawn on another bank than that at which it is presented for payment. ...
A transit check or not on-us check is a negotiable item (check) which is drawn on another bank than that at which it is presented for payment. ...
Checks drawn on paying banks located in the same check processing region (usually corresponding to Federal Reserve districts) as the physical location of the branch at which the account is held by the depositary institution are considered "local" checks. Checks payable at banks outside of the check processing region in which the branch of the depositary institution at which the check is deposited are considered "non-local." In general, holds allowed on local checks are shorter due to the decreased time required by the depositary bank to collect on the item.
Hold Types and Lengths "Two business day" holds, with which funds from a deposit must be made available no later than the second business day following the business day on which the deposit was made, apply to the following types of items: - Federal government items (including USPS money orders) which are usually subject to next-day availability but are deposited into an account not in the name of the payee on the item;
- Other items usually subject to next-day availability (such as state and local government checks, and checks drawn on Federal Reserve banks) which are within the same check processing region ("local" items), and are not deposited into an account in the name of the payee listed on the item;
- Local checks.
"Five business day" holds, under which funds from a deposit must be made available no later than the fifth business day following the business day on which the deposit was made, apply to the following items: - Items usually subject to next-day availability (such as state and local government items, and those drawn on Federal Reserve banks) which are considered "non-local," and are not subject to next-day availability due to being deposited into an account not bearing the name of the payee listed on the item;
- Non-local checks.
Adjustments Under 12 CFR 229.12(d), a bank may delay the availability of withdrawal by cash or similar means by one additional business day. "Similar means" includes the issuance of Cashier's checks or other certified funds electronic payments, or "other irrevocable commitments to pay," but does not include the extension of credit to a Federal Reserve bank that presents a check to the depositary institution for payment. Also, at least $400 of the deposit amount must be made available for withdrawal by 5:00pm on the day that the funds are subject to availability (without the additional business day extension). Such funds (for a total of up to $500, including the $100 subject to next-day availability) may be withdrawn in cash or by similar means.
Under 12 CFR 229.12(e), the depositary bank may delay the availability of funds on checks not covered by next-day availability by one additional business day if: (1) the check is deposited at a branch of the bank located in Alaska, Hawaii, Puerto Rico, or the U.S. Virgin Islands; and (2) the check is drawn on or payable at a bank not located in the same state as the depositary bank. Official language(s) English Capital Juneau Largest city Anchorage Area - Total - Width - Length - % water - Latitude - Longitude Ranked 1st 663,267 mi² / 1 717 854 km² 808 mi / 1300 km 1,479 mi / 2380 km 13. ...
Official language(s) Hawaiian and English Capital Honolulu Largest city Honolulu Area - Total - Width - Length - % water - Latitude - Longitude Ranked 43rd 28,337 km² n/a km 2,450 km 41. ...
In addition, deposits made at nonproprietary ATMs (ATMs not owned and operated by the depositary bank) are required to be made available for withdrawal no later than the fifth business day following the business day after which the deposit is made. Outdoor ATMs may be free-standing, like this kiosk, or built into the side of banks or other buildings An automated teller machine, automatic teller machine (ATM) or cash machine is an electronic device that allows a banks customers to make cash withdrawals and check their account balances without...
Exception Holds The following special circumstances are outlined in Reg CC, under which extended hold periods are allowed. The regulation states that funds held under these circumstances are subject to holds which may be extended by a "reasonable period," in addition to holds which are subject under the next-day availability and two and five business day hold rules.
A "reasonable period" is defined as:
- Up to one business day for "on-us" items, drawn on the same financial institution as deposited;
- Up to five business days for local items (and items subject to next-day availability);
- Up to six business days for non-local items or those subject to 12 CFR 229.12(e).
The following are the types of exception holds that may be placed, at the discretion of the depositary institution: - Large deposits: the general availability rules do not apply to amounts deposited in one banking day in excess of $5000 - such amounts exceeding $5000 may be held by an extended hold, for a period depending on their normal availability. For example, a customer depositing U.S. Treasury check (which would normally be available on the next business day) would receive credit for the first $5000 on the next business day, but the amount over $5000 would be available after a "reasonable period," in this case no more than five business days following the business day on which the deposit was made. This stipulation applies to aggregate amounts deposited to all of a customer's accounts in one business day, regardless of other owners or holders on the accounts.
- Redeposited checks: items which have been returned unpaid by the drawee bank and are being redeposited by the customer or the depositary bank are subject to extended holds, except those which are marked returned because of: (a) a missing endorsement, where that endorsement has been obtained; or (b) being postdated, where the check is no longer postdated when redeposited.
- Repeated overdrafts: items are subject to extended holds for a period of six months after the last occurace of overdraft on an account or combination of accounts where:
- On six or more banking days within the preceeding six months the account balance was negative, or would have been negative had checks or other items been paid; or
- On two or more banking days within the last six months the account balance was negative, or would have become negative, in the amount of $5000 or more, had checks or items been paid.
- Reasonable cause to doubt collectability: checks are subject to extended hold periods where collectability of an item can be reasonably doubted, specifically, "reasonable cause to believe a check is uncollectible requires the existence of facts that would cause a well-grounded belief in the mind of a reasonable person. Such belief shall not be based on the fact that the check is of a particular class or is deposited by a particular class of persons." In addition, overdraft or insufficient funds fees assessed as a result of holds placed under this category must be refunded at the customer's request, granted that the item is paid and that the deposit hold is clearly the only reason which caused the fees to be incurred.
- Emergency conditions: under this section, checks are subject to extended holds (which are calculated as a "reasonable period" after the emergency has ceased, or the time usually alloted for extended holds, whichever is later) in the following events, granted the bank exercises "such diligence as the circumstances require":
- An interruption of communications or computer or other equipment facilities;
- A suspension of payments by another bank;
- A war; or
- An emergency condition beyond the control of the depositary bank.
In the event of extended holds, notice must be provided to the customer at the time of deposit, or no later than the first business day after the circumstances warranting the hold are discovered by the depositary bank. In cases where the deposit is not made to an employee in person, the notice must be transmitted to the customer no later than the first business day following the business day on which the deposit is made. Hold notices must include the following: Deposit may refer to: Finance A deposit is a specific sum of money taken and held on account, by a bank as a service provided for its clients. ...
Typical cancelled personal cheque as used in the U.S. A cheque (CwE) or check (AmE), thought to have developed from Persian Ú†Ùƒ chek, is a negotiable instrument instructing a financial institution to pay a specific amount of a specific currency from a specific demand account held in the maker/depositor...
Endorsement can refer to: A political endorsement is where a significant individual, group, or business selects, campaigns, or contributes heavily to a political campaign. ...
An overdraft is the amount by which the withdrawals exceed the deposits on a bank account. ...
An overdraft is the amount by which the withdrawals exceed the deposits on a bank account. ...
- Account number or code;
- Date of the deposit;
- Amount of the deposit that is being held;
- The reason for the extended hold;
- The time period within which the funds will be made available.
In addition, for exception holds placed in the event of repeated overdrafts or emergency conditions, additional information as to the nature of the reason for the exception hold must be provided to the customer. In the event of the exception for repeated overdrafts, a one-time notice stating the time period (usually six months) during which exception holds may be invoked and the reason for the possible exception, may be substituted in lieu of exception hold notices each time a hold is placed.
New Accounts Special rules apply to "new accounts," those which have been open for less than 30 days. New account rules do not apply to customers who have had other deposit accounts which were open for more than 30 days. The rules for new accounts are as follows: - Cash and electronic payments are subject to next-day availability;
- Items usually afforded next-day availability are only covered up to aggregate amounts of $5000; amounts over $5000 are subject to be held for no more than nine business days following the business day after which the deposit was made;
- "On-us" and items under $100 must be made available for next-day withdrawal;
- All other items are subject to holds according to their "local" or "non-local" classificaion.
Disclosure Financial institutions must disclose their hold policies to all account holders, and make the policy available in written form upon request by any customer. It must also be provided at the time of opening of all new accounts.
Additional disclosures are required on deposit slips, at ATMs, and when the policy is changed in any way.
Payment of interest According to the regulation, interest-bearing accounts shall receive earnings from funds from the time they are collected by the depositary institution, regardless of hold lengths.
Enforcement Under the act, enforcement is divided by the type of institution, respective to each type's mandated oversight authority: - For national banks, and federal branches and agencies of foreign banks, the act is enforced by the Office of the Comptroller of the Currency;
- For members of the Federal Reserve System who are not national banks, and for offices, branches, and agencies of foreign banks located in the United States (who are not federal branches and agencies of foreign banks), the provisions are enforced by the Board of Governors of the Federal Reserve;
- In the case of banks insured by the Federal Deposit Insurance Corporation who are not members of the Federal Reserve System, and insured state branches of foreign banks, enforcement falls to the Board of Directors of the FDIC;
- The Director of the Office of Thrift Supervision is responsible for enforcing the provisions of the act in the case of savings associations whose deposits are insured by the FDIC;
- Federal credit unions or credit unions insured by the National Credit Union Share Insurance Fund are subject to enforcement of the act by the National Credit Union Administration Board.
Awards for damages are limited under the regulation, including not more than $1000 in addition to actual damages for individual actions, and not more than the lesser of $500,000 or 1% of the net worth of the bank, in addition to actual damages, for class actions. The United States Office of the Comptroller of the Treasury was established in 1863 and serves to charter, regulate and supervise all National banks and the federal branches and agencies of foreign banks. ...
The Federal Reserve System is headquartered in the Eccles Building on Constitution Avenue in Washington, DC. The Federal Reserve System (also the Federal Reserve; informally The Fed) is the central bank of the United States. ...
The Federal Reserve System is headquartered in the Eccles Building on Constitution Avenue in Washington, DC. The Federal Reserve System (also the Federal Reserve; informally The Fed) is the central bank of the United States. ...
The Federal Deposit Insurance Corporation (FDIC) is an independent federal agency created by the Glass-Steagall Act of 1933. ...
The Federal Deposit Insurance Corporation (FDIC) was created by the Glass-Steagall Act of 1933. ...
The Office of Thrift Supervision (OTS), an agency in the U.S. Treasury Department, is the primary regulator of federal savings associations (sometimes referred to as federal thrifts). ...
The Federal Deposit Insurance Corporation (FDIC) was created by the Glass-Steagall Act of 1933. ...
A credit union is a not-for-profit co-operative financial institution that is owned and controlled by its members, through the election of a volunteer Board of Directors elected from the membership itself. ...
See also The Check Clearing for the 21st Century Act, or Check 21 Act is a United States public Law 108_100, enacted into law October 28, 2004 by the 108th Congress. ...
Notes - ^ 12 USC 40 can be viewed here, on the website of the Legal Information Institute at Cornell Law School. Text of 12 CFR 229 can be viewed here, through the GPO.
|
Feeds |
Contact