CC Regulation Inflation adjustments effective July 1
In July 2019, the Consumer Financial Protection Bureau and the Federal Reserve Board issued a final rule on inflation adjustments of dollar amounts under CC Regulation. As a reminder, the increased dollar amounts come into effect on July 1, 2020.
The Dodd-Frank Act requires adjustments every five years, calculated by the annual percentage increase in the Consumer Price Index for urban wage earners and office workers.
Inflation-related adjustments will change four of the main fund availability requirements:
- $ 200 increases to $ 225 for check deposits not subject to next day availability (note that the amount of $ 200 is referred to as $ 100 in CC regulations);
- $ 5,000 increases to $ 5,525 for one-time holdbacks, which includes, but is not limited to, large deposits, new account holdings, and repeatedly overdrawn accounts;
- $ 400 increases to $ 450 for holdings extended by one business day when a check is deposited for withdrawal in cash or similar means; and
- Civil liability increased from $ 1,000 for an individual action and $ 500,000 for a class action to $ 1,100 and $ 552,500, respectively.
Remember that the CC Regulation requires that financial institutions give consumers at least 30 days’ notice before implementing any changes to their policies on availability of funds, except that any change that would speed up the availability of funds may be disclosed no later than 30 days after implementation.
Finally, don’t forget to update your institution’s policies and procedures, account disclosures, hold notices and any lobbying notices.