ARLINGTON, Va.-While the Senate has approved the bill to eliminate one of the dual-fee disclosure requirements at ATMs, it's no time for credit unions to relax when it comes to monitoring ATMs.
That is the advice of Steve Van Beek, NAFCU's director of regulatory compliance, who cautioned that nothing prevents people from filing lawsuits and that some states may still require on-machine fee disclosures.
The bill to eliminate one of the dual-fee disclosure requirements at ATMs is aimed at eliminating serial filers of ATM disclosure lawsuits who have filed more than 50 civil suits over the absence of on-machine disclosures. The bill means that a single disclosure of fees, such as those typically provided on ATM screens, are adequate to satisfy the requirement of the Electronic Funds Disclosure Act. Currently, financial institutions are required to have a physical notice on the ATM machine as well as on-screen.
The Bigger Concern
Van Beek confirmed that the new law will reduce CU litigation risks related to ATM notices, but that CUs should still be aware that in the U.S., "You can still be sued for anything."
But a bigger concern, according to Van Beek, is that the bill changes federal law on ATM fee disclosures but there are state laws that could still require an on-machine fee disclosure. "I know New York state has such a law and there are others."
Van Beek told Credit Union Journal that credit unions with ATMs nationwide will have a little more work ahead than those that serve members in a single state.
"These credit unions will have to find out what the state law is regarding ATM fee disclosures in all the states they have a presence in, and will have to adjust monitoring and documenting of their ATMs accordingly."
Van Beek added that it might be more prudent for CUs with ATMs across the country to keep the same ATM monitoring policies they have in place today, as that would ensure consistency of operations and make sure they are still complying with state law.
Reduced Time & Effort
Van Beek agreed that in states that do not require dual-fee disclosures, CUs can now reduce the time and effort spent tracking, photographing, documenting and auditing the notices on their ATMs. "These additional resources were all needed to help reduce the litigation risk. When the bill is signed, the need for that amount of due diligence and documentation is removed."
Van Beek also advised that it's not time to remove existing on-machine notices. "While they are no longer required, there is no harm in keeping them on your ATMs. If you were sued after the law change, you'll have another defense. Also, members and non-members are given additional notice about any fees."
The bill, awaiting President Obama's signature, will not solve the more than 50 suits brought by over the absence of the on-site disclosure.
For info: NAFCU: www.nafcu.org