Signs of the Times: FDIC Mulls Changes to Ad Regulations

By C/A Staff

Recently the FDIC issued a Request for Information (RFI) regarding their advertising requirements, signaling an interest in re-evaluating the regulations, which were last updated in 2006[1].  Banking has changed drastically in the past decade and a half, as the state of affairs in 2006 did not really include online banking, mobile banking, smartphone apps, digital wallets, or many of the other 2020 technologies now considered standard.  In issuing this RFI, the FDIC is attempting to modernize and keep up with the changing face of banking.

To this end, the FDIC is seeking public help with their ad regulations found at 12 CFR 328.  The FDIC is encouraging comments from all interested parties on all aspects of this regulation.  The existing regulations require the use of the FDIC’s official sign wherever deposits are taken, as well as the use of the official advertising statement in advertisements for deposit products and services and non-specific products and services.

The official sign is well-known to be 7” by 3” with black lettering on a gold background and is required to be continuously displayed at each station where deposits are normally received.  The official sign is allowed but not required at remote service facilities that accept deposits, such as ATMs.  With this RFI, the FDIC is interested in comments regarding the importance of having the official sign continuously displayed at every station.  Would it be sufficient to have a digital display that periodically shows the official sign in the area where deposits are taken? Should the requirements keep up with the changes in the places where deposits are taken?  Should remote facilities be included? Are the size and color restrictions on the official sign still important?

Our most common question about the official sign is whether the it is required on ATMs. The answer is no, but you’re allowed to display it and many banks choose to do so.

According to the regulation, banks may comply with the requirement to include the official advertising statement by stating “Member FDIC.”[2]  Of particular interest to the FDIC are comments regarding whether certain forms of advertising should be exempt from the regulation, and conversely, should certain exempt forms of advertising be required to carry the official statement?

Our most common question about the official statement is whether “Member FDIC” is required on various advertisements (e-mail signature, t-shirt, scoreboard, etc.) where the bank’s name or logo is promoted, but not necessarily on any products.  The answer is often yes, but the facts and circumstances will help to determine the answer on a case-by-case basis.

Comments must be received by March 19, 2020 and can be submitted through the normal channels, such as the FDIC’s website, or e-mailing the agency at [email protected], making sure to include RIN 3064-AZ14 in the subject line.