Consumer Checking Fairness Act

Consumer Checking Fairness Act - Amends the Expedited Funds Availability Act to require a depository institution to post checks presented for payment against a checking account used primarily for personal, family, or household purposes after the close of any business day in the numerical order of the checks, beginning with the lowest number.

Requires customer notification and consent for a different posting order.

Requires a depository institution to credit all deposits to such account after the close of any business day before debiting any check drawn on the account and presented for payment.

Directs the Board of Governors of the Federal Reserve System to prescribe implementing regulations.

[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4415 Introduced in House (IH)]







109th CONGRESS
  1st Session
                                H. R. 4415

  To establish a fair order of posting checks and deposits to prevent 
unjust enrichment of financial institutions from fees that accrue only 
 by virtue of the order used by the institution for posting checks and 
                   deposits, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 18, 2005

 Mr. Meek of Florida (for himself and Mr. Ryan of Ohio) introduced the 
   following bill; which was referred to the Committee on Financial 
                                Services

_______________________________________________________________________

                                 A BILL


 
  To establish a fair order of posting checks and deposits to prevent 
unjust enrichment of financial institutions from fees that accrue only 
 by virtue of the order used by the institution for posting checks and 
                   deposits, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Consumer Checking Fairness Act''.

SEC. 2. FAIR ORDER FOR POSTING CHECKS.

    (a) Order of Checks Posted.--Section 607 of the Expedited Funds 
Availability Act (12 U.S.C. 4006) is amended by adding at the end the 
following new subsection:
    ``(f) Numerical Order of Posting Checks.--
            ``(1) In general.--Subject to paragraph (2), in the process 
        of posting checks presented for payment against a checking 
        account used primarily for personal, family, or household 
        purposes after the close of any business day, the checks shall 
        be posted by a depository institution against the account in 
        the numerical order of the checks, beginning with the lowest 
        number.
            ``(2) Notice and customer consent for different posting 
        order.--A depository institution may alter the order required 
        under paragraph (1) for posting checks against a checking 
        account used primarily for personal, family, or household 
        purposes only if--
                    ``(A) specific notice of the alternate posting 
                order is given by the depository institution to the 
                prospective accountholder verbally and in writing 
                before the account is opened (using a document that is 
                separate from the account application and any other 
                document provided to the prospective accountholder in 
                the process of opening the account) which fully 
                describes the posting process and explains in clear and 
                easy-to-understand language the possible consequences 
                to the accountholder of the alternate posting order; 
                and
                    ``(B) the depository institution obtains from the 
                accountholder, and retains in its records, a written 
                acknowledgement of the receipt by the accountholder of 
                the notice required under subparagraph (A) and the 
                written consent of the accountholder for the use of the 
                alternate posting order.''.
    (b) Credits Required to Be Posted Before Debits.--Section 607 of 
the Expedited Funds Availability Act (12 U.S.C. 4006) is amended by 
inserting after subsection (f) (as added by subsection (a) of this 
section) the following new subsection:
    ``(g) Order of Posting Debits and Credits.--In the process of 
posting credits and debits against a checking account used primarily 
for personal, family, or household purposes after the close of any 
business day, all deposits shall be credited by a depository 
institution to the account before debiting any check drawn on the 
account and presented for payment.''.
    (c) Regulations.--The Board of Governors of the Federal Reserve 
System shall--
            (1) prescribe such regulations as may be necessary to 
        implement the amendments made by subsection (a) and (b); and
            (2) publish such regulations in final form before the end 
        of the 180-day period beginning on the date of the enactment of 
        this Act.
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