CUNA Regulatory Comment Call

August 29, 2005



Please feel free to fax your responses to CUNA at 202-638-7052; or e-mail them to Associate General Counsel Mary Dunn at or to Assistant General Counsel Lilly Thomas at; or mail them to Mary or Lilly c/o CUNA’s Regulatory Advocacy Department, 601 Pennsylvania Avenue, NW, South Building, Suite 600, Washington, D.C. 20004.


The Federal Reserve Board (Board) issued a proposal in September 2004 as part of an update to Regulation E. It proposed to revise the official staff commentary to clarify that ATM operators may disclose on the ATM that a fee may be imposed or specify the type of transaction or consumer for which a fee is imposed, if there are circumstances in which there would not be a fee charged for a particular transaction.

After reviewing comments, the Board believes it would be appropriate to make this clarification in the regulation rather than in the commentary. Therefore, the Board is withdrawing its proposed commentary revisions addressing this issue and is issuing this proposed rule and commentary to elicit additional comments.


The Board issued a proposal to amend Regulation E, which implements the Electronic Fund Transfer Act (EFTA), and the official staff commentary to the regulation to clarify the disclosure obligations of ATM operators.

Currently, Regulation E requires an ATM operator that imposes a fee for initiating a transaction to post notices in a prominent and conspicuous location on or at the ATMs at which a fee will be imposed. This proposal would revise the regulation to clarify that the notice can state that a fee may be imposed, rather than will be imposed, if there are circumstances in which an ATM fee will not be charged for a particular transaction.

This notice is not intended to represent a complete disclosure to the consumer about fees, but gives consumers the ability to know immediately which ATMs generally charge a fee for use. In addition to this notice, a more detailed disclosure of whether a fee will be charged and the amount of the fee is required on the ATM screen or receipt before the transaction is completed.

An ATM operator is defined as anyone who operates an ATM at which consumers initiate a transaction, but does not hold the account to or from which the transaction is made. Therefore, this option would not be available to credit unions that do not charge a fee for their members, but charge nonmembers for use of the ATM. However, credit unions that do not charge nonmembers for some transactions, such as a balance inquiry, but charge for other transactions, such as a transfer or withdrawal, would have the flexibility to state that a fee may be imposed. Credit unions that do not charge nonmembers who carry cards that are issued under electronic benefit transfer (EBT) governmental programs, or members of other credit unions that participate in a shared ATM network may also use this disclosure.

This proposal would not change the notice requirements for credit unions that impose an ATM fee in all cases or that do not impose an ATM fee at all. Those credit unions that charge a fee to all nonmembers must still provide notice that a fee “will” be charged. A sign is not required if no fee is charged for ATM use.


Eric Richard • General Counsel • (202) 508-6742 •
Mary Mitchell Dunn • SVP & Associate General Counsel • (202) 508-6736 •
Jeffrey Bloch • Assistant General Counsel • (202) 508-6732 •
Lilly Thomas • Assistant General Counsel • (202) 508-6733 •
Catherine Orr • Senior Regulatory Counsel • (202) 508-6743 •