12 U.S.C. § 5011: Consumer awareness

Summary

Banks must give customers a short notice about substitute checks. The notice must say that a substitute check is the legal equivalent of the original check if it accurately shows all the information from the front and back of the original check at the time the original was truncated, and it must include a clear statement that the substitute is a legal copy you can use like the original. The notice must also explain the consumer recredit rights under section 5006 when a customer in good faith thinks a substitute check was charged to their account in error. For people who banked with the bank when the chapter became effective, the bank must send the notice by the first regular communication after that date. New customers must get it when the account starts. The bank may mail the notice or use any method the customer agreed to. If a customer asks for a copy of a check and gets a substitute check, the notice must be given at that time. The Board had to publish optional model forms within the 9‑month period beginning October 28, 2003; banks that use those forms and describe their practices accurately are treated as complying, but using the model language is not required.

Title 12, §5011

Banks and Banking, Source: USLM XML via OLRC

(a)In general

Each bank shall provide, in accordance with subsection (b), a brief notice about substitute checks that describes—

(1)how a substitute check is the legal equivalent of an original check for all purposes, including any provision of any Federal or State law, and for all persons, if the substitute check—

(A)accurately represents all of the information on the front and back of the original check as of the time at which the original check was truncated; and

(B)bears the legend: “This is a legal copy of your check. You can use it in the same way you would use the original check.”; and

(2)the consumer recredit rights established under section 5006 of this title when a consumer believes in good faith that a substitute check was not properly charged to the account of the consumer.

(b)Distribution

(1)Existing customers

With respect to consumers who are customers of a bank on the effective date of this chapter and who receive original checks or substitute checks, a bank shall provide the notice described in subsection (a) to each such consumer no later than the first regularly scheduled communication with the consumer after the effective date of this chapter.

(2)New account holders

A bank shall provide the notice described in subsection (a) to each consumer who will receive original checks or substitute checks, other than existing customers referred to in paragraph (1), at the time at which the customer relationship is initiated.

(3)Mode of delivery

A bank may send the notices required by this subsection by United States mail or by any other means through which the consumer has agreed to receive account information.

(4)Consumers who request copies of checks

Notice shall be provided to each consumer of the bank that requests a copy of a check and receives a substitute check, at the time of the request.

(c)Model language

(1)In general

Before the end of the 9-month period beginning on October 28, 2003, the Board shall publish model forms and clauses that a bank may use to describe each of the elements required by subsection (a).

(2)Safe harbor (3) Use of model language not required

(A)In general

A bank shall be treated as being in compliance with the requirements of subsection (a) if the bank’s substitute check notice uses a model form or clause published by the Board and such model form or clause accurately describes the bank’s policies and practices.

(B)Deletion or rearrangement

A bank may delete any information in the model form or clause that is not required by this chapter or rearrange the format.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The

Effective Date

of this chapter, referred to in subsec. (b)(1), is at the end of the 12-month period beginning on Oct. 28, 2003, except as otherwise specifically provided in this chapter, see section 20 of Pub. L. 108–100, set out as an

Effective Date

note under section 5001 of this title. This chapter, referred to in subsec. (c)(2)(B), was in the original “this Act”, meaning Pub. L. 108–100, Oct. 28, 2003, 117 Stat. 1177, which is classified generally to this chapter. For complete classification of this Act to the Code, see

Short Title

note set out under section 5001 of this title and Tables.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective at the end of the 12-month period beginning on Oct. 28, 2003, see section 20 of Pub. L. 108–100, set out as a note under section 5001 of this title.

§5011 Consumer Awareness

Summary

Title 12, §5011

Notes & Related Subsidiaries

Editorial Notes

References in Text

Effective Date

Effective Date

Short Title

Statutory Notes and Related Subsidiaries

Effective Date

Citations & Metadata