The National Consumer Law Center (on behalf of its low-income clients), Americans for Financial Reform Education Reform Fund, Consumer Reports, Student Borrower Protection Center, Public Justice Center, Public Good Law Center, U.S. PIRG, Consumer Federation of America, and Better Markets submitted comments regarding the Federal Deposit Insurance Corporation’s (FDIC) recent proposed changes to part 328 of its regulations, which would modernize the rules governing use of the official FDIC sign and advertising statements and clarify the FDIC’s regulations regarding misrepresentations of deposit insurance coverage.
Throughout its ninety-year history, the FDIC has helped maintain stability in the nation’s financial system and earned the trust of consumers. However, the banking landscape has undergone significant changes in recent years leading to increased confusion among and deception of consumers as to whether a financial institution is an insured depository institution (IDI) and whether the consumers’ funds are protected by deposit insurance.
Unfortunately, regulation has not kept pace with these changes. The FDIC’s proposed rule will help close that gap and bring greater certainty and confidence to the new digital channels through which depositors increasingly handle their banking needs, and provide clearer rules to prevent bad actors from misusing the FDIC’s name to deceive consumers.