Alert February 15, 2011

FDIC Proposes Rule to Improve Public Awareness of Deposit Insurance Limits

The FDIC issued a Notice of Proposed Rulemaking (the “Proposed Rule“) to improve consumer awareness of deposit insurance coverage.  The Proposed Rule would require certain bank staff to receive annual training on the basic principles of deposit insurance coverage with the FDIC providing the materials – a computer-based module – with no recordkeeping required of the bank.  The Proposed Rule would limit the required training to those employees who open accounts or are authorized by the bank to answer deposit insurance questions.  The Proposed Rule would apply to deposit accounts opened at the bank, by telephone, by mail or by means of the Internet or other technology.  The Proposed Rule also would require bank staff opening a new account to inquire whether the customer has other accounts at the bank and whether the aggregate deposits may exceed the deposit insurance limit of $250,000.  If a customer’s deposits exceed the deposit insurance limit, the bank would provide basic literature to the customer including a copy of the FDIC’s publication, Deposit Insurance Summary.  Comments are due no later than 60 days after the Proposed Rule is published in the Federal Register.