The Federal Deposit Insurance Corporation (FDIC) today announced a 45-day extension to the public comment period for the FDIC’s proposed rule on recordkeeping for custodial accounts. The proposal seeks to address risks related to certain third-party arrangements, protect depositors, and promote public confidence in insured deposits. Comments on the proposal must be received by the FDIC no later than January 16, 2025.
On September 17, 2024, the FDIC announced a Notice of Proposed Rulemaking (NPR) that would strengthen recordkeeping for bank deposits received from third party, non-bank companies accepting those deposits on behalf of consumers and businesses. The proposed rule initially provided a 60-day comment period from when it was published in the Federal Register, which was December 2, 2024.
Under the proposed rule, FDIC-insured banks holding certain custodial accounts, as defined in the proposal, would be required to take certain steps to ensure accurate account records are maintained in order to determine the individual owner of the funds, including a requirement to reconcile the account for each individual owner on a daily basis. These requirements, as well as others, apply if the bank uses a third party to maintain records. The proposal’s provisions also provide for oversight by the banks’ primary federal supervisor to review for compliance with this rule and enforcement authority to compel compliance if the bank fails to meet these requirements.
The FDIC invites public comments on all aspects of the proposal.