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F ederal Re s e r v e Ba n k DALLAS. TEXAS of Dallas 75222 Circular No. 76-135 October 8, 1976 A m e ric a n R e v o lu tio n B ic en ten n ia l NEW REGULATION A A — UNFAIR O R DECEPTIVE ACTS OR PRACTICES Consumer Complaint Procedure TO ALL BANKS AND OTHERS CONCERNED IN THE ELEVENTH FEDERAL RESERVE DISTRICT: The Board of Governors of the Federal Reserve System has announced the establishment of a consumer complaint procedure regarding alleged unfair or deceptive acts or practices of State member banks and other banks. The new regu lation is effective as of September 27, 1976. The Board will receive complaints regarding any bank. For those banks other than State member banks of the Federal Reserve System, complaints will be referred to the appropriate regulatory agency. The procedures for dealing with consumer complaints are designed to: 1. Assure consumers of prompt and responsive action on complaints involving State member banks, and prompt referral of complaints involving other banks; 2. Through records kept of complaints, and of findings concerning them, provide the means to single out banking practices or acts that are widespread or frequent enough to require possible reg ulatory action by the Board. The Board's complaint procedure is not limited to those persons who are customers of the bank in question, nor to those acts or practices which are already the subject of Federal regulation. Any person with knowledge of an act or practice which that person considers unfair or deceptive may utilize the complaint procedures. Complaints should describe the bank practice or action objected to, give the name and address of the bank concerned, and the name and address of the per son complaining. Complaints should be submitted (preferably) in writing to the Director of the Office of Saver and Consumer Affairs at the Board of Governors of the Federal This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) - 2 Reserve System, Washington, D.C. 20551, or the Federal Reserve Bank for the District in which the bank is located. In the Eleventh Federal Reserve District this would be the Federal Reserve Bank of Dallas, Regulations Department, 400 South Akard, Dallas, Texas 75222. Printed on the following pages is the text of the Board's order as sub mitted for publication in the FEDERAL REGISTER. Copies of the new regulation will be sent to you as soon as they become available. Any questions concerning Regulation A A should be directed to Samuel E. McCloud of our Regulations Department at (214) 651-6169. Sincerely yours, T. W. Plant First Vice President TITLE 12 - BANKS AND BANKING CHAPTER II - FEDERAL RESERVE SYSTEM SUBCHAPTER A - BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM (REG. AA) (DOCKET NO. R-0056) (PART 227 - UNFAIR OR DECEPTIVE ACTS OR PRACTICES) Consumer Complaint Procedure Regarding Alleged Unfair or Deceptive Acts or Practices of State Member Banks The Federal Trade Commission Act as amended (Public Law 93-637) requires each of the Federal bank supervisory agencies to establish a separate division of consumer affairs and to institute a procedure for handling consumer complaints regarding unfair or deceptive acts or practices of banks under their jurisdiction. Pursuant to §18(f) of that Act, the Board of Governors has instituted a procedure for receiving and handling con sumer complaints regarding State-chartered banks that are members of the Federal Reserve System. In August 1974, in anticipation of the passage of Public Law 93-637, the Board established a separate Office of Saver and Consumer Affairs which administers the con sumer legislation for which the Board has been given responsibility. Among these statutes are the Truth-in-Lending Act, the Fair Credit Reporting Act, the Fair Credit Billing Act, the Equal Credit Opportunity Act, the Federal Trade Commission Act as amended, and the Home Mortgage Disclosure Act. The Board instituted a formal System-wide procedure for handling consumer complaints regarding State member banks in January 1976. The procedure is designed to serve two purposes. First, it assures consumers of prompt and responsive action on their complaints involving State member banks. Second, it provides a mechanism for identifying those acts or practices of commercial banks that may require further investigation and pos sible regulatory action by the Board. In order to provide the Board with comprehensive current information on complaints against commercial banks not under its direct supervi sion, the other two Federal bank supervisory agencies (the Comptroller of the Currency and the Federal Deposit Insurance Corporation) have established ongoing procedures by which the Board receives quarterly reports on the number and substance of complaints against national and insured nonmember State banks. The Board's complaint procedure is not limited to those persons who are cus tomers of the State member bank in question or to those acts or practices that are already the subject of Federal regulation. Any person with knowledge of an act or practice of a State member bank that the person considers unfair or deceptive may utilize the complaint procedure. Similarly, while a consumer complaint may arise under an existing Federal - 2 statute or Board regulation, a complaint may also be directed at an act or practice that is either expressly authorized or not prohibited by current Federal or State laws or regula tions. However, the complaint procedure does not apply to requests for general informa tion or publications such as statistical data. Nor does it apply to complaints regarding such matters as monetary policy, fiscal agency functions, or Treasury issues. Complaints regarding State member banks should be addressed to the Director, Office of Saver and Consumer Affairs, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Such complaints may also be addressed to the Federal Reserve Bank serving the district in which the State member bank is located. The locations of these Federal Reserve Banks and names and addresses to whom complaints may be addressed follow: Mr. Luther M. Hoyle, Jr. Vice President Federal Reserve Bank of Boston 30 Pearl Street Boston, Massachusetts 02106 Mr. Harris C. Buell, Jr. Assistant Vice President Federal Reserve Bank of Chicago 230 South LaSalle Street Chicago, Illinois 60690 Mr. Edward F. Kipfstuhl Manager, Bank Regulations Department Federal Reserve Bank of New York 33 Liberty Street New York, New York 10045 Mr. Harold E. Uthoff Vice President Federal Reserve Bank of St. Louis 411 Locust Street St. Louis, Missouri 63166 Mr. Lawrence C. Murdoch, Jr. Vice President and Secretary Federal Reserve Bank of Philadelphia 925 Chestnut Street Philadelphia, Pennsylvania 19105 Mr. Sheldon Azine Assistant Counsel and Assistant Secretary Federal Reserve Bank of Minneapolis 250 Marquette Street Minneapolis, Minnesota 55480 Mr. Harry Huning Vice President Federal Reserve Bank of Cleveland 1455 East Sixth Street Cleveland, Ohio 44101 Mr. Robert Scott Chief Examiner Federal Reserve Bank of Kansas City 925 Grand Avenue Kansas City, Missouri 64198 Mr. James Slate Assistant Counsel Federal Reserve Bank of Richmond 100 North Ninth Street Richmond, Virginia 23261 Mr. George C. Cochran, III Vice President Federal Reserve Bank of Dallas 400 South Akard Street Dallas, Texas 75222 M r . Jack Sicard Assistant Vice President Federal Reserve Bank of Atlanta 104 Marietta Street, N.W. Atlanta, Georgia 30303 Mr. Oscar Cel Ii Credit and Consumer Affairs Officer Federal Reserve Bank of San Francisco 400 Sansome Street San Francisco, California 94120 - 3 C o m p l a in t s r e g a r d i n g b a n k s o t h e r t h a n S ta t e m e m b e r b a n k s a r e n o t s u b j e c t to t h e B o a r d ' s c o n s u m e r c o m p la i n t p r o c e d u r e s . S u c h c o m p la i n ts s h o u l d b e a d d r e s s e d to t h e a g e n c y h a v i n g j u r i s d i c t i o n w ith r e s p e c t to t h a t i n s t i t u t i o n . F o llo w in g is a list of t h e a p p r o p r i a t e F e d e r a l a g e n c i e s to w h i c h c o m p la i n ts s h o u l d b e a d d r e s s e d a n d t h e t y p e s of i n s t i t u t i o n s f o r w h ic h t h e a g e n c i e s a r e r e s p o n s i b l e : N ational B a n k s C o m p t r o l l e r of t h e C u r r e n c y W a s h i n g t o n , D . C . 20219 Nonmem ber In su re d B anks F e d e r a l D e p o s it I n s u r a n c e C o r p o r a t i o n R eg io n al D i r e c t o r f o r t h e r e g i o n in w h i c h t h e n o n m e m b e r i n s u r e d b a n k is l o c a te d . T h e p r o v i s i o n s of 5 U . S . C . §553 w ith r e s p e c t to n o tic e of p r o p o s e d r u l e m a k i n g , o p p o r t u n i t y for c o m m e n t, a n d d e l a y e d e f f e c tiv e d a t e a r e d e e m e d i n a p p l i c a b l e to t h i s r u l e b e c a u s e it c o n s t i t u t e s a r u l e of a g e n c y o r g a n i z a t i o n , p r o c e d u r e o r p r a c t i c e , w i t h i n t h e m e a n in g of 5 U . S . C . § 553(b) (A) . T h e r u l e is e f f e c tiv e im m e d ia te ly . P u r s u a n t to § 1 8 (f) o f th e F e d e r a l T r a d e C o m m is s io n A ct a s a m e n d e d b y P u b l i c Law 93-637, t h e B o a r d h e r e b y a m e n d s 12 CFR C h a p t e r II b y a d d i n g a n e w P a r t 227, to r e a d a s follows: PART 227—UNFAIR OR DECEPTIVE ACTS OR PRACTICES SECTION 2 2 7 .1 — DEFINITIONS F o r t h e p u r p o s e s of t h i s P a r t , ^ u n l e s s t h e c o n t e x t i n d i c a t e s o t h e r w i s e , t h e fol lo w in g d e f i n i t i o n s a p p l y : (a) " B o a r d " m e a n s t h e B o a r d of G o v e r n o r s of t h e F e d e r a l R e s e r v e S y s t e m . (b) " C o n s u m e r c o m p la i n t” m e a n s a n a l l e g a t i o n b y o r on b e h a l f of a n i n d i v i d u a l , g r o u p of i n d i v i d u a l s , o r o t h e r e n t i t y t h a t a p a r t i c u l a r a c t o r p r a c t i c e of a S ta t e m e m b e r b a n k is u n f a i r o r d e c e p t i v e , o r in v io la tio n of a r e g u l a t i o n i s s u e d b y t h e B o a r d p u r s u a n t to a F e d e r a l s t a t u t e , o r in v io la tio n of a n y o t h e r A ct o r r e g u l a t i o n u n d e r w h i c h t h e B a n k m u s t o p e r a t e . (c) " S ta t e m e m b e r b a n k " m e a n s a b a n k th a t is c h a r t e r e d b y a S ta t e a n d is a mem b e r of t h e F e d e r a l R e s e r v e S y s t e m . (d) U n l e s s t h e c o n t e x t i n d i c a t e s o t h e r w i s e , " b a n k " s h a l l b e c o n s t r u e d to m e an a " S ta te m e m b e r b a n k , " a n d " c o m p l a in t " to m e a n a " c o n s u m e r c o m p l a i n t . " 1 T h e w o r d s " t h i s P a r t , " a s u s e d h e r e i n , m e a n T i t l e 12, C h a p t e r II, P a r t 227 o f t h e C o d e of F e d e r a l R e g u l a t i o n s , c i te d a s 12 CFR 227 a n d d e s i g n a t e d a s R e g u l a t i o n AA. - 4 SECTION 227.2—CONSUMER COMPLAINT PROCEDURE (a) S u b m i s s i o n of c o m p l a i n t s . (1) A n y c o n s u m e r h a v i n g a c o m p la i n t r e g a r d a S t a t e m e m b e r b a n k is in v i t e d to s u b m i t it to t h e F e d e r a l R e s e r v e S y s t e m . T h e c o m p la i n t s h o u l d b e s u b m i t t e d in w r i t i n g , if p o s s i b l e , a n d s h o u l d i n c l u d e t h e f o llo w in g in fo rm a tio n : (i) A d e s c r i p t i o n o f t h e a c t o r p r a c t i c e t h a t is t h o u g h t to b e u n f a i r o r d e c e p t i v e , o r in v io l a ti o n of e x i s t i n g law o r r e g u l a t i o n , i n c l u d i n g all r e l e v a n t fa c ts; (ii) T h e n a m e a n d a d d r e s s of t h e b a n k t h a t is t h e s u b j e c t of t h e co m (iii) T h e n a m e a n d a d d r e s s of t h e c o m p l a i n a n t . p lain t; an d (2) C o n s u m e r c o m p l a i n t s s h o u l d b e m a d e to: (i) T h e D i r e c t o r , Office of S a v e r a n d C o n s u m e r A f f a i r s , B o a rd of G o v e r n o r s of t h e F e d e r a l R e s e r v e S y s t e m , W a s h i n g t o n , D . C . 20551; o r (ii) T h e F e d e r a l R e s e r v e B a n k of t h e D i s t r i c t in w h i c h t h e b a n k is lo c a te d . T h e a d d r e s s e s of t h e F e d e r a l R e s e r v e B a n k s a r e a s follows: F e d e r a l R e s e r v e B a n k of B osto n 30 P e a r l S t r e e t B o s to n , M a s s a c h u s e t t s 02106 F e d e r a l R e s e r v e B a n k of C h ic a g o 230 S o u th L a S a lle S t r e e t C h i c a g o , Illin o is 60690 F e d e r a l R e s e r v e B a n k of New Y o r k 33 L i b e r t y S t r e e t New Y o r k , New Y o r k 10045 F e d e r a l R e s e r v e B a n k of S t . Louis 411 L o c u s t S t r e e t S t . L o u i s , M is s o u r i 63166 F e d e r a l R e s e r v e B a n k of P h i l a d e l p h i a 925 C h e s t n u t S t r e e t P h i l a d e l p h i a , P e n n s y l v a n i a 19105 F e d e r a l R e s e r v e B a n k of M in n e a p o lis 250 M a r q u e t t e S t r e e t M i n n e a p o l i s , M in n e s o ta 55480 F ed eral R e s e rv e B ank of C leveland 1455 E a s t S i x t h S t r e e t C l e v e l a n d , O hio 44101 F e d e r a l R e s e r v e B a n k of K a n s a s C ity 925 G r a n d A v e n u e K a n s a s C i t y , M is s o u ri 64198 F e d e r a l R e s e r v e B a n k of R ic h m o n d 100 N o rth N in th S t r e e t R ic h m o n d , V i r g i n i a 23261 F e d e r a l R e s e r v e B a n k of D allas 400 S o u th A k a r d S t r e e t D a l l a s , T e x a s 75222 F e d e r a l R e s e r v e B a n k of A tla n ta 104 M a r ie tta S t r e e t , N.W . A t l a n t a , G e o r g ia 30303 F ed eral R e se rv e Bank of San F ran cisco 400 S a n s o m e S t r e e t S a n F r a n c i s c o , C a l if o r n ia 94120 - 5 (b) R e s p o n s e to c o m p l a i n t s . W ithin 15 b u s i n e s s d a y s of r e c e i p t of a w r i t t e n c o m p la i n t b y t h e B o a r d o r a F e d e r a l R e s e r v e B a n k , a s u b s t a n t i v e r e s p o n s e o r a n a c k n o w l e d g m e n t s e t t i n g a r e a s o n a b l e tim e f o r a s u b s t a n t i v e r e s p o n s e w ill b e s e n t to t h e in d i v i d u a l m a k in g t h e c o m p l a i n t . (c) R e f e r r a l s to o t h e r a g e n c i e s . C o m p l a in t s r e c e i v e d b y t h e B o a r d o r a F e d e r a l R e s e r v e B a n k r e g a r d i n g a n a c t o r p r a c t i c e o f a n in s t i t u t i o n o t h e r t h a n a S ta t e m e m b e r b a n k w ill b e f o r w a r d e d to t h e F e d e r a l a g e n c y h a v i n g j u r i s d i c t i o n o v e r t h a t i n s t i t u t i o n . By o r d e r o f t h e B o a r d of G o v e r n o r s , S e p t e m b e r 27, 1976. ( s i g n e d ) T h e o d o r e E . A llis o n T h e o d o r e E . A llis o n S e c r e t a r y of t h e B o a r d (SEAL)
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