Regulatory Compliance
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Regulators, Mount Up!

Not to show my age, but like many, I happen to be a child of the 90s. I was reminded of that this past weekend when an “I Love the 90s” group of recording artists performed at our Iowa State Fair. Among the list of musicians performing their 90’s hits were Young MC (“Bust A Move”), Tone Loc (“Wild Thing”), Coolio (“Fantastic Voyage”), Salt N Pepa (“Push It”), and Vanilla Ice (“Ice Ice Baby”). Unfortunately I was unable to attend and relive my past, but I heard they put on a great show…especially for those who are nostalgic about the wonderful 90’s.

Recounting my days of past and my days of present, I can’t help but wonder why Warren G was not on stage performing “Regulate?” Back in the early 90s it was just a cool song to hear on the radio or while out cruising in the Monte Carlo.  In the present, one of the opening lines of Mr. G’s song speaks so true to our industry today, “regulators mount up!” Well, regulators are mounting up again with a remix of one of their past hits, “Know Before You Owe”.

This time, the “Know Before You Owe” initiative contains beats and lyrical verses for overdraft disclosures (sorry for all these musical puns). On August 4th, the Consumer Financial Protection Bureau (CFPB) dropped an exclusive track of disclosure prototypes “designed to improve the model form that banks and credit unions already provide to consumers weighing overdraft coverage.”

These new prototypes, like other “Know Before You Owe” initiatives, are meant to help consumers. This is done by providing a clearer picture for consumers to understand the costs of opting in, help consumers evaluate the risks and benefits of opting in, and provide consumers with an overview of overdraft programs that are provided by credit unions and other financials.

Knowing that overdrafts have always been on the CFPB’s hot tracks playlist (sorry, hopefully that was my LAST musical pun for this post), it should be no surprise that they have released new disclosures for this particular financial service. I am sure there will also be a release of further rules and requirements, applicable to overdrafts, in the near future.

So, in the proverbial words of Warren G and Nate Dogg, “Nate Dogg, Warren G, AND the CFPB have to regulate.”

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