Pub. 1 2010 Issue 4

www.wvbankers.org 8 The guidelines go on to make it clear that “The adoption of these stan- dards provides OTS with a useful method of analyzing whether practices are unfair or deceptive. The other federal fi nancial institution regula- tory agencies and FTC take the same approach .” (emphasis added) The proposed guidelines provide specific definitions of the kinds of “harm” that customers might suffer as a result of an improperly managed program that could be found to be viola- tions of UDAP. Let’s be clear. The vast majority of community banks try very hard to offer services that benefit their customers and the bank. No bank can thrive in the long term by mistreating customers, even unintentionally. The OTS discussion would seem to agree with that opinion in the beginning of the quote given above. Even though this proposed guidance is not yet final as this article goes to print, I would offer the thought that commu- nity bankers who review the new proposed FDIC guidance on overdraft programs with an eye toward thinking about the design, execution, communication, and daily management of their overdraft programs might find valuable material here. Main Street bankers have already been unjustly tarred with the same brush that should have been exclusively aimed at the instigators of the mortgage market meltdown. Prudent risk management (particularly “reputation risk” management) can help ensure that the egregious behavior of a handful of play- ers don’t destroy the perceived value of a service that the vast majority of our customers enjoy. Strunk & Associates, the developer of the nation’s most suc- cessful overdraft program, conducted a webcast on September 22 for bankers on current developments and trends in these programs, including a discussion of the recent Wells Fargo lawsuit and the OTS civil money penalties against Woodforest Bank. You can be sure that your institution is fully conversant with this critical issue by obtaining a free audio replay of this important one hour review. Simply email me at the address below, and I will be happy to call or email you with the infor- mation you will need. Q Mike Potter is Senior Vice President of Houston-based Strunk & Associates, L.P. Strunk’s Overdraft PrivilegeSM service is the most frequent choice of bankers around the country. Mike can be reached at mpotter@strunklp.com. Q Overdraft Programs — continued from page 7 Like the strength of the Appalachian Mountains... West Virginia Community Banks deserve a strong Correspondent Bank working for them. The Bankers’ Bank has a solid tradition of personal service matched with superior products. “I look forward to earning your business and becoming your Correspondent Banker.” – Scott Jones, Vice President The Bankers’ Bank of Kentucky Your Correspondent Bank 800.248.3229 | 502.695.3000 | www.bbky.com Scott Jones - Vice President Cell: 502.609.2559 5504_W.VirginiaAd_final.indd 1 11/2/09 1:02:40 PM