Expedited Funds Availability Act
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The Expedited Funds Availability Act (EFA or EFAA) was enacted in 1987 by the United States Congress for the purpose of standardizing hold periods on deposits made to commercial banks and to regulate institutions' use of deposit holds. It is also referred to as Regulation CC or Reg CC, after the Federal Reserve regulation that implements the act. The law is codified in Title 12, Chapter 40 of the US Code and Title 12, Part 229 of the Code of Federal Regulations.
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[edit] Disclosure
Financial institutions must disclose their hold policies to all account holders, and make the policy available in written form upon request by any customer. It must also be provided at the time of opening of all new accounts.
Additional disclosures are required on deposit slips, at ATMs, and when the policy is changed in any way.
[edit] Payment of interest
According to the regulation, interest-bearing accounts shall receive earnings from funds from the time they are collected by the depositary institution, regardless of hold lengths.
[edit] Enforcement
Under the act, enforcement is divided by the type of institution, respective to each type's mandated oversight authority:
- For national banks, and federal branches and agencies of foreign banks, the act is enforced by the Office of the Comptroller of the Currency;
- For members of the Federal Reserve System who are not national banks, and for offices, branches, and agencies of foreign banks located in the United States (who are not federal branches and agencies of foreign banks), the provisions are enforced by the Board of Governors of the Federal Reserve;
- In the case of banks insured by the Federal Deposit Insurance Corporation who are not members of the Federal Reserve System, and insured state branches of foreign banks, enforcement falls to the Board of Directors of the FDIC;
- The Director of the Office of Thrift Supervision is responsible for enforcing the provisions of the act in the case of savings associations whose deposits are insured by the FDIC;
- Federal credit unions or credit unions insured by the National Credit Union Share Insurance Fund are subject to enforcement of the act by the National Credit Union Administration Board.
Awards for damages are limited under the regulation, including not more than $1000 in addition to actual damages for individual actions, and not more than the lesser of $500,000 or 1% of the net worth of the bank, in addition to actual damages, for class actions.
[edit] See also
- check clearing
- Check Clearing for the 21st Century Act (Check 21 Act)
- automated check clearing
