Comments on: Regulation D Is Outdated

By: Patrick

Patrick — Tue, 17 Apr 2012 21:33:32 +0000

How does this “mess up” the reporting process? At any moment the computers in these institutions can give an immediate and accurate account of all such balances. If I transfer some funds from my money market to my checking account a minute later, will the system collapse? Someone in the late 70′s did not have the foresight to see that six was going to be woefully insufficient when on-line banking became the norm. Or maybe he or she did, and all the conspiracy theorists are right — it is just a way to extract more fees from the public when they gained such ease of access over their own money that they could move it into low interest transaction accounts only when necessary?

By: Patrick

Patrick — Tue, 17 Apr 2012 21:23:47 +0000

Really? Having this information somewhere in the small print of the account information is insufficient. This is obviously something that should verbally be brought up and thoroughly explained during the opening of an account. Spoon fed? The fact that you know what you’re doing for a living is refreshing, so do probably all of those who were caught off guard by this inane limitation. If we were all experts at your job, who would need you? And why don’t you explain why this regulation is still necessary, why it is so important that it can be bypassed by using an ATM of a live teller, and why in this new on-line age the number of transactions has not been adjusted upwards to reflect the times?

By: Brian in AZ

Brian in AZ — Thu, 05 Apr 2012 17:49:03 +0000

The purpose of Reg D is to assist the Federal Reserve in managing the M1 and M2 Money Supply. In order to know how much money is in the M1 money supply financial institutions must report to the Federal Reserve how much money is in checking accounts (demand accounts), currency, coin, ATMs, and negotiable instruments (ie. Travelers Checks). Someone back in the late-70′s decided that six (6) was the magic number of transactions that would be allowed in savings/MMA accounts (M2) in order for those accounts not to be considered “transaction” accounts. The reason your bank/credit union/S&L limits it at six is for REPORTING purposes. I understand the purpose for Reg D, the argument should be is six (6) still the appropriate number? I think so… do you really need to perform more than six Reg D transfers from a “savings” account each month? If you say “yes” than you have your money in the wrong account. Why does my bank charge a fee? So you will STOP treating your savings account like a transaction/checking account and messing up the reporting. Needless to say the “they didn’t tell me argument” doesn’t work because generally nobody reads the notices they get in the mail or the disclosures they receive – how do you think we got into this mortgage mess?

By: Joseph

Joseph — Tue, 27 Mar 2012 23:36:04 +0000

The problem lies not with Reg D, but with ourselves. As an administrator for a credit union overdraft program, I repeatedly hear the excuse “but I was never told about this.” Simple fact is, they were provided the disclosures and failed to read them. Too many people nowadays expect to be spoon-fed information rather than do their due diligence.

By: Natalie

Natalie — Fri, 16 Mar 2012 20:21:33 +0000

Sherry,
I too have been employed at a few different credit unions over the course of 10 years, and I feel the Regulation is also outdated; however, telling someone how they should manage their savings and checking accounts is ridiculous. Why is it that only Credit Unions seem to enforce the Reg D limits? I worked at a bank for 5 years, and they didn’t even know what that regulation was let alone enforce it. Charging at $40 per transaction fee for using money in your own account is ludicrous. You’ve been in the box too long to see how illogical it truly is I think.

By: jason

jason — Wed, 07 Mar 2012 03:23:00 +0000

I would have prefered a fee, instead my capitalone direct banking money market account was closed without my prior notification. I transfered funds from my savings to checking more than 6 times. No email, phone call, alert or message. When I called them they said a check will be mailed to me in 2-3 weeks. Also, my direct deposit will be returned the next day so I will need to wait until next month to have access to my money.

By: The squeaky wheel gets the grease « tempering the storm

The squeaky wheel gets the grease « tempering the storm — Fri, 16 Dec 2011 16:09:02 +0000

[...] from my savings to cover a purchase the day before the end of the month and consequently payday. Bullshit! So I naturally made a big deal about it, the girl on the phone didn’t have the power to fix [...]

By: Sherry

Sherry — Thu, 01 Sep 2011 20:00:45 +0000

I have been employed at a Credit Union for 28 years. I also fee that in this age of technology, Reg D is far outdated. However, I do feel that customers/members should take some responsibility for their own transactions. Take 5 minutes to balance your account and the banks and credit unions of the world will be more than happy to NOT charge you a fee.

By: Joseph

Joseph — Thu, 21 Jul 2011 06:09:09 +0000

@Jazzika

Thanks for the comment. Sorry to hear you got charged fees from Regulation D. Were you able to get any of them reversed? Your bank should have sent you a warning letter telling you about the transfer limitation before actually charging any fees. I’m assuming either they didn’t or maybe you just missed it. Either way it’s a total bummer and I feel your pain… although I’ve been careful over the past few years and managed to avoid dealing with this fiasco again.

By: Jazzika

Jazzika — Sat, 02 Jul 2011 03:57:47 +0000

I find this article a very good read and this regulation more than insane. I was just charged $60 this month with no explanation at all, I had to call to even become aware of this. My Savings account was opened in the 80′s when I was a baby, by my parents. There is no documentation that I have ever received about this Regulation, and this Regulation pre-dates internet banking entirely. In researching, banks deal with this Regulation’s fees differently, which leads me to believe banks choose to enforce a higher penalty based on their own money-grubbing standards. Needless to say, I am doing everything in my power to rid this ridiculous charge. They have no right to do this to anyone.