Compliance Blog

NAFCU members can access it here. (Member log-in.) This month's article addresses NCUA's new rule that governs member inspection of credit union books, records, and minutes.  Of course, there will be the usual assortment of questions and answers.  Such as...

Question: Our members have the option of sending a text message to our credit union to initiate a transfer between their checking and share accounts. Would this count toward the six transaction limit of Regulation D?

Answer: Yes. Under Regulation D, "telephonic" transfers from a share account (non-transaction account) generally count towards the six-transfer limitation. The regulation indicates that telephonic transfers include those involving "data transmission." 12 C.F.R. § 204.2(d)(2). Even though not contemplated when the regulation was adopted, a text message would most likely qualify as a “data transmission.” A 1992 letter from the Federal Reserve indicates that "…telephone, fax, and computer transactions to transfer funds to another account at the same institution" are subject to the six-transaction limit. See Federal Reserve Staff Opinion of July 13, 1992, Federal Reserve Regulatory Service (FR RS) 2-342.22, question 4.