Updating Credit Card Disclosures

Written by Steve Van Beek NAFCU
The transition of the regulations will cause numerous tweaks and changes for credit unions that regulators might view as technical or non-substantive. These tweaks and changes, unfortunately, will require credit unions to take steps to ensure their disclosures are accurate. For example, the move to the CFPB will require credit unions to update their application and account opening disclosures for credit cards.
References to the CFPB in Credit Card Application & Account Opening Disclosures
One of the changes over the past years to Reg Z required tabular formats for credit card application and solicitation disclosures as well as account opening disclosures for credit cards. One of the required disclosures is information informing borrowers of the ability to obtain additional information from the Federal Reserve's website.

• For a good visual of this disclosure, view the Fed's G-10(B) Model Form under the "For Credit Card Tips from the Federal Reserve" section.

The transition of Regulation Z to the CFPB brought with it a tweak to this disclosure requirement. Credit unions will need to update their disclosures to refer to the CFPB and the CFPB's website in the future.

• Here is the CFPB's G-10(B) Model Form from Appendix G of Section 1026. See the section "For Credit Card Tips from the Consumer Financial Protection Bureau."

When must credit unions update their disclosures? The CFPB gave institutions one year to make the update. Credit unions will need to ensure their disclosures reflect the CFPB's information by January 1, 2013.
Here is the language from the application and solicitations disclosure regulation - 12 CFR 1026.60(b)(15):

"(15) Web site reference. A reference to the Web site established by the Bureau and a statement that consumers may obtain on the Web site information about shopping for and using credit cards. Until January 1, 2013, issuers may substitute for this reference a reference to the Web site established by the Board of Governors of the Federal Reserve System."

Similar language is included in 12 CFR 1026.6(b)(2)(xiv) for account opening disclosures. The CFPB discussed this tweak in the preamble to its republishing of Regulation Z.
Note: This disclosure is only required for credit card accounts - thus, the tweak would only need to be made on your credit card application and solicitation disclosures and your credit card account opening disclosures.