[Federal Register Volume 89, Number 98 (Monday, May 20, 2024)]
[Rules and Regulations]
[Pages 43737-43739]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-10844]


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FEDERAL RESERVE SYSTEM

12 CFR Part 229

[Regulation CC; Docket No. R-1832]
RIN 7100-AG 76


Availability of Funds and Collection of Checks

AGENCY: Board of Governors of the Federal Reserve System (Board) and 
Consumer Financial Protection Bureau (CFPB).

ACTION: Final rule.

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SUMMARY: The Board and the CFPB (collectively, the Agencies) are 
amending Regulation CC, which implements the Expedited Funds 
Availability Act (EFA Act) and the Check Clearing for the 21st Century 
Act (Check 21 Act), to fulfill a statutory requirement in the EFA Act 
to adjust the dollar amounts under the EFA Act for inflation.

DATES: Effective date: This final rule is effective July 1, 2025.

FOR FURTHER INFORMATION CONTACT: 
    Board: Andrew Ruben, Counsel (202) 263-4851, Legal Division, or Ian 
C.B. Spear, Assistant Director (202) 452-3959, Division of Reserve Bank 
Operations and Payment Systems. For users of TTY-TRS, please call 711 
from any telephone, anywhere in the United States.
    CFPB: George Karithanom, Regulatory Implementation & Guidance 
Program Analyst, Office of Regulations, at 202-435-7700 or at: https://reginquiries.consumerfinance.gov/. If you require this document in an 
alternative electronic format, please contact 
[email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    Regulation CC (12 CFR part 229) implements the EFA Act and the 
Check 21 Act.\1\ Subpart B of Regulation CC implements the requirements 
set forth in the EFA Act regarding the availability schedules within 
which banks \2\ must make funds available for withdrawal, exceptions to 
those schedules, disclosure of funds availability policies, and payment 
of interest. The EFA Act and subpart B of Regulation CC contain 
specified dollar amounts, including: (1) the minimum amount of 
deposited funds that banks must make available for withdrawal by 
opening of business on the next day for certain check deposits 
(``minimum amount''); \3\ (2) the amount a bank must make available 
when using the EFA Act's permissive adjustment to the funds-
availability rules for withdrawals by cash or other means (``cash 
withdrawal amount''); \4\ (3) the amount of funds deposited by certain 
checks in a new account that are subject to next-day availability 
(``new-account amount''); \5\ (4) the threshold for using an exception 
to the funds-availability schedules if the aggregate amount of checks 
on any one banking day exceeds the threshold amount (``large-deposit 
threshold''); \6\ (5) the threshold for determining whether an account 
has been repeatedly overdrawn (``repeatedly overdrawn threshold''); \7\ 
and (6) the civil liability amounts for failing to comply with the EFA 
Act's requirements.\8\
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    \1\ Expedited Funds Availability Act, 12 U.S.C. 4001 et seq.; 
Check Clearing for the 21st Century Act, 12 U.S.C. 5001 et seq.
    \2\ Section 229.2(e) of Regulation CC defines ``bank'' to 
include banks, savings institutions, and credit unions.
    \3\ The minimum amount is currently $225. 12 CFR 
229.10(c)(1)(vii); 12 U.S.C. 4002(a)(2)(D).
    \4\ The cash withdrawal amount is currently $450. 12 CFR 
229.12(d); 12 U.S.C. 4002(b)(3)(B).
    \5\ The new-account amount is currently $5,525. 12 CFR 
229.13(a)(1)(ii); 12 U.S.C. 4003(a)(3).
    \6\ The large-deposit threshold is currently $5,525. 12 CFR 
229.13(b); 12 U.S.C. 4003(b)(1).
    \7\ The repeatedly overdrawn threshold is currently $5,525. 12 
CFR 229.13(d)(2). This dollar amount is not specified in the EFA 
Act, but is a result of the authority of the Board and the CFPB 
under section 604(b)(3) of the EFA Act (12 U.S.C. 4003(b)(3)) to 
establish reasonable exceptions to time limitations for deposit 
accounts that have been overdrawn repeatedly.
    \8\ The civil liability amounts are currently ``not less than 
$100 nor greater than $1,100'' for an individual action and ``not 
more than $552,500 or 1 percent of the net worth'' of a depository 
institution for a class action. 12 CFR 229.21(a)(2)(i), 
(a)(2)(ii)(B).
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    The Dodd-Frank Wall Street Reform and Consumer Protection Act 
(Dodd-Frank Act) made certain amendments to the EFA Act, and these 
amendments were effective on July 21, 2011.\9\ Section 609(a) of the 
EFA Act,\10\ as amended by section 1086(d) of the Dodd-Frank Act, 
provides that the Board and the Director of the CFPB shall jointly 
prescribe regulations to carry out the provisions of the EFA Act, to 
prevent the circumvention or evasion of such provisions, and to 
facilitate compliance with such provisions.
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    \9\ Public Law 111-203, sections 1062, 1086, 1100H, 124 Stat. 
2081 (2010); 75 FR 57252 (September 20, 2010).
    \10\ 12 U.S.C. 4008(a).
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    Additionally, section 1086(f) of the Dodd-Frank Act added section 
607(f) of the EFA Act, which provides that the dollar amounts under the 
EFA Act shall be adjusted every five years after December 31, 2011, by 
the annual percentage increase in the Consumer Price Index for Urban 
Wage Earners and Clerical Workers (CPI-W), as published by the Bureau 
of Labor Statistics, rounded to the nearest multiple of $25.\11\ In 
2019, the Agencies promulgated a final rule that implemented this 
section of the EFA Act. The final rule codified a methodology for 
inflation adjustments and specified that the relevant dollar amounts 
shall be adjusted effective on July 1, 2020, on July 1, 2025, and on 
July 1 of every fifth year after 2025.\12\

[[Page 43738]]

For dollar amount adjustments that are effective on July 1, 2025, the 
inflation measurement period begins in July 2018 and ends in July 
2023.\13\
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    \11\ 12 U.S.C. 4006(f).
    \12\ See 84 FR 31687 (July 3, 2019); 84 FR 45403 (Aug. 29, 
2019); 12 CFR 229.11(a). As noted in the preamble to the July 2019 
final rule, the effective dates are consistent with section 302 of 
the Riegle Community Development and Regulatory Improvement Act of 
1994 (Pub. L. 103-325, 108 Stat. 2160, 12 U.S.C. 4802). That section 
provides that new regulations and amendments to regulations 
prescribed by Federal banking agencies, including the Board (but not 
the CFPB), that impose additional reporting, disclosures, or other 
new requirements on insured depository institutions, shall take 
effect on the first day of a calendar quarter beginning on or after 
the date on which the regulations are published in final form (with 
certain exceptions). 84 FR 31687 at 31688 n.16.
    \13\ 12 CFR 229.11(b)(1).
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II. Adjustment

    As a result of the 21.8 percent increase in the CPI-W between July 
2018 and July 2023, the following thresholds are effective July 1, 
2025: \14\
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    \14\ Dollar amounts have been rounded to the nearest multiple of 
$25, consistent with statutory requirements. 12 U.S.C. 4006(f).

------------------------------------------------------------------------
                         Section                             Threshold
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Minimum Amount, 12 CFR 229.10(c)(1)(vii)................            $275
Cash Withdrawal Amount, 12 CFR 229.12(d)................             550
New-Account Amount, 12 CFR 229.13(a)(1)(ii).............           6,725
Large-Deposit Threshold, 12 CFR 229.13(b)...............           6,725
Repeatedly Overdrawn Threshold, 12 CFR 229.13(d)(2).....           6,725
Civil Liability Minimum and Maximum for Individual              \15\ 125
 Action, 12 CFR 229.21(a)(2)(i).........................          $1,350
Civil Liability Maximum for Class Action, 12 CFR                 672,950
 229.21(a)(2)(ii)(B)....................................
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III. Legal Authority

    In issuing the final rule, the Agencies are exercising their 
authority under section 609(a) of the EFA Act (12 U.S.C. 4008(a)) to 
amend subpart B of Regulation CC to prescribe regulations to carry out 
the provisions of the EFA Act, to prevent the circumvention or evasion 
of such provisions, and to facilitate compliance with such 
provisions.\16\
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    \15\ The civil liability minimum threshold did not change in the 
previous five-year inflation measurement period due to rounding to 
the nearest $25, consistent with statutory requirements. As a 
result, the inflation adjustment for this five-year period includes 
the aggregate inflation percentage increase for both five-year 
periods. 12 CFR 229.11(b)(4).
    \16\ Additionally, section 604(b)(3) of the EFA Act (12 U.S.C. 
4003(b)(3)) authorizes the Agencies to establish reasonable 
exceptions to time limitations for deposit accounts that have been 
overdrawn repeatedly. As noted above, the Agencies also rely on this 
authority in adjusting the repeatedly overdrawn threshold in 12 CFR 
229.13(d).
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IV. Procedural Requirements

A. Administrative Procedure Act

    Under the Administrative Procedure Act, notice and opportunity for 
public comment are not required if the Agencies find that notice and 
public comment are impracticable, unnecessary, or contrary to the 
public interest.\17\ The amendments in this rule are expected, 
technical, and non-discretionary adjustments that are required by 
statute and result from the application of a methodology in Regulation 
CC that the Agencies previously published for comment.\18\ For these 
reasons, the Agencies have determined that publishing a notice of 
proposed rulemaking and providing opportunity for public comment are 
unnecessary. Therefore, the amendments are adopted in final form.
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    \17\ 5 U.S.C. 553(b)(B).
    \18\ In the preamble to the July 2019 final rule, the Agencies 
stated their expectation that notice and opportunity for public 
comment on subsequent inflation adjustments would be impracticable, 
unnecessary, or contrary to the public interest, because the 
calculation methodology for the adjustments is set forth in the 
regulation and future execution of the adjustments will be technical 
and non-discretionary. 84 FR 31687, 31690.
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B. Regulatory Flexibility Act

    The Regulatory Flexibility Act does not apply to a rulemaking where 
a general notice of proposed rulemaking is not required.\19\ As noted 
previously, the Agencies have determined that it is unnecessary to 
publish a general notice of proposed rulemaking for this joint final 
rule. Accordingly, the Regulatory Flexibility Act's requirements 
relating to an initial and final regulatory flexibility analysis do not 
apply.
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    \19\ 5 U.S.C. 603(a) and 604(a).
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C. Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995,\20\ the 
Agencies have reviewed this final rule and determined that it does not 
create any new information collections or substantially revise any 
existing collections.
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    \20\ 44 U.S.C. 3506; 5 CFR part 1320.
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D. Plain Language Used

    Section 722 of the Gramm-Leach-Bliley Act (Pub. L. 106-102, 113 
Stat. 1338, 1471, 12 U.S.C. 4809) requires the Federal banking agencies 
to use plain language in all proposed and final rules published after 
January 1, 2000. The Board has sought to present the final rule in a 
simple and straightforward manner.

E. CFPB Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the CFPB will submit a report containing this rule and other required 
information to the United States Senate, the United States House of 
Representatives, and the Comptroller General of the United States prior 
to the rule taking effect. The Office of Information and Regulatory 
Affairs has designated this rule as not a ``major rule'' as defined by 
5 U.S.C. 804(2).

List of Subjects in 12 CFR Part 229

    Banks, banking, Federal Reserve System, Reporting and recordkeeping 
requirements.

Authority and Issuance

    For the reasons set forth in the preamble, the Board amends 
Regulation CC, 12 CFR part 229, as set forth below:

PART 229--AVAILABILITY OF FUNDS AND COLLECTIONS OF CHECKS 
(REGULATION CC)

0
1. The authority citation for part 229 continues to read as follows:

    Authority:  12 U.S.C. 4001-4010, 12 U.S.C. 5001-5018.

Subpart B--Availability of Funds and Disclosure of Funds 
Availability Policies


Sec.  229.10  [Amended]

0
2. In Sec.  229.10, remove ``$225,'' and add in its place ``$275;'' in 
paragraph (c)(1)(vii)(A).

0
3. In Sec.  229.11, revise paragraph (c) to read as follows:


Sec.  229.11  Adjustment of dollar amounts.

* * * * *
    (c) Amounts. (1) For purposes of Sec.  229.10(c)(1)(vii), the 
dollar amount in effect during a particular period is the amount stated 
in this paragraph (c)(1) for that period.
    (i) Prior to July 21, 2011, the amount is $100.

[[Page 43739]]

    (ii) From July 21, 2011, through June 30, 2020, by operation of 
section 603(a)(2)(D) of the EFA Act (12 U.S.C. 4002(a)(2)(D)) the 
amount is $200.
    (iii) From July 1, 2020, through June 30, 2025, the amount is $225.
    (iv) Effective July 1, 2025, the amount is $275.
    (2) For purposes of Sec.  229.12(d), the dollar amount in effect 
during a particular period is the amount stated in this paragraph 
(c)(2) for that period.
    (i) Prior to July 1, 2020, the amount is $400.
    (ii) From July 1, 2020, through June 30, 2025, the amount is $450.
    (iii) Effective July 1, 2025, the amount is $550.
    (3) For purposes of Sec. Sec.  229.13(a), (b), and (d), the dollar 
amount in effect during a particular period is the amount stated in 
this paragraph (c)(3) for that period.
    (i) Prior to July 1, 2020, the amount is $5,000.
    (ii) From July 1, 2020, through June 30, 2025, the amount is 
$5,525.
    (iii) Effective July 1, 2025, the amount is $6,725.
    (4) For purposes of Sec.  229.21(a), the dollar amounts in effect 
during a particular period are the amounts stated in this paragraph 
(c)(4) for the period.
    (i) Prior to July 1, 2020, the amounts are $100, $1,000, and 
$500,000 respectively.
    (ii) From July 1, 2020, through June 30, 2025, the amounts are 
$100, $1,100, and $552,500 respectively.
    (iii) Effective July 1, 2025, the amounts are $125, $1,350, and 
$672,950 respectively.


Sec.  229.12  [Amended]

0
4. In Sec.  229.12, remove ``$450'' and ``$225'' and add in their 
places ``$550'' and ``$275'', respectively, in paragraph (d).


Sec.  229.13  [Amended]

0
5. In Sec.  229.13, remove ``$5,525'' and add in its place ``$6,725'' 
in paragraphs (a)(1)(ii), (b), and (d)(2).


Sec.  229.21  [Amended]

0
6. In Sec.  229.21:
0
a. Remove ``$100'' and ``$1,100'' and add in their places ``$125'' and 
``$1,350'', respectively, in paragraph (a)(2)(i).
0
b. Remove ``$552,500'' and add in its place ``$672,950'' in paragraph 
(a)(2)(ii)(B).

Appendix E to Part 229--[Amended]

0
7. In appendix E to part 229, remove the dollar amounts in the 
``Remove'' column wherever they appear within the section indicated in 
the ``Section'' column, and add in their places the dollar amounts in 
the ``Add'' column in the following table:

------------------------------------------------------------------------
                       Section                         Remove      Add
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IV.D.1..............................................    $5,525    $6,725
IV.D.5..............................................       225       275
IV.D.5..............................................     1,225     1,275
IV.D.5..............................................       500       550
VI.D.1. and 2.......................................       450       550
VI.D.1..............................................       100       275
VI.F.1..............................................       100       275
VII.B.2.b...........................................       100       275
VII.B.2.b...........................................     5,525     6,725
VII.B.2.b...........................................     5,000     6,725
VII.C.1.............................................     5,525     6,725
VII.C.2.............................................     2,225     2,275
VII.C.2.............................................       225       275
VII.C.2.............................................     5,300     6,450
VII.C.2.............................................     3,475     2,275
VII.D.3.............................................       100       275
VII.E.2.............................................     5,525     6,725
VII.E.4.............................................       100       275
VII.F.1.............................................       100       275
VII.G.1.............................................       100       275
VII.H.2.b, b.(1), and b.(2).........................     5,525     6,725
VII.H.2.b.(1) and (2)...............................       225       275
VII.H.2.b.(1) and (2)...............................     5,300     6,450
VII.I.4.............................................     5,000     6,725
VII.I.4.............................................     2,000       275
XIII.C.3 and 4......................................       400       550
XIV.C.2.............................................       225       275
XIV.C.2.............................................        75        25
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    By order of the Board of Governors of the Federal Reserve 
System.
Ann E. Misback,
Secretary of the Board.
Brian Shearer,
Assistant Director, Office of Policy Planning and Strategy, Consumer 
Financial Protection Bureau.
[FR Doc. 2024-10844 Filed 5-17-24; 8:45 am]
BILLING CODE 6210-01-P; 4810-AM-P