Whatu2019s the difference between a service-oriented,u00a0u003ca href=u0022https://www.jmfa.com/Services/JMFA-Overdraft-Privilegeu0022u003efully disclosed overdraft programu003c/au003eu00a0that is clearly and responsibly presented to account holders u2026 and one that is used solely to earn revenue, at all costs? In the case of TCF Financial Corp., itu2019s $30 million dollars and a major blow to its reputation.nnYou may have heard that TCF recently agreed to the large payment tou00a0u003ca href=u0022http://www.startribune.com/tcf-agrees-to-pay-30-million-to-settle-dispute-over-the-way-it-offered-overdraft-protection/488763151/u0022u003eresolve accusationsu003c/au003eu00a0that it misled its account holders about its overdraft program.nnBut hereu2019s the interesting part: the bank did notu00a0u003cemu003etechnicallyu003c/emu003eu00a0break any compliance rules with their overdraft services. They did admit, however, that from 2010 to 2013, their account holders may not have fully understood their options for accepting or rejecting the service.nnu003cstrongu003eMisleading Instead of Servingu003c/strongu003ennAccording tou00a0u003ca href=u0022https://www.cnbc.com/2017/01/19/questionable-overdraft-fees-persist-lawsuit-alleges.htmlu0022u003ereportsu003c/au003e, TCF employed questionable tactics to get account holders to sign up for its overdraft program. The company allegedly asked new customers to accept the overdraft program at the same time they were accepting other mandatory terms and conditions related to opening an account.nnBank employees also reportedly asked account holders if they wanted their u201cTCF Check Card to continue to work as it does today?u201d A reply of u201cyesu201d was considered an opt-in.nnSo,u00a0u003cemu003etechnicallyu003c/emu003e, an opt-in was obtained u2026 but certainly not ethically.nnThis unbalanced presentation of choices (not aided at all by the former TCF National Bank CEO naming his pleasure boatu00a0u003cemu003eOverdraftu003c/emu003e) landed the bank in a whole lot of hot water.nnThink it canu2019t happen to your bank or credit union? Without a fully disclosed overdraft program, it can.nnu003cstrongu003eHonesty u2014 Still the Best Policyu003c/strongu003ennThere is a simple path away from trouble like what TCF experienced, though. For overdraft protection programs that rely on loopholes and sales tactics u2014 or even just passive or uninformed opt-ins u2014 to succeed, itu2019s essential to start looking at things from a service perspective.nnTreat your account holders respectfully and responsibly by fully disclosing your overdraft program, explaining the terms and conditions thoroughly instead of going for the quick opt in. Theyu2019ll know the service is there if they need it, and theyu2019ll use it if they so choose. Isnu2019t that better than surprising them with fees they didnu2019t realize they were agreeing to?nnBeing open and honest from the start will serve you well in the eyes of your account holders.nnu003cstrongu003ePeace of Mind u2014 Itu00a0u003cemu003eCanu003c/emu003eu00a0Be Guaranteedu003c/strongu003ennOn some level, TCF probably worked hard to make sure they stayed in compliance, despite the account holder confusion. Can you be sure that yours will perform well even if your examiner or unhappy account holders put your practices under a spotlight?nnLooking to an expert in overdraft services can help alleviate the worry. Itu2019s important to find a partner that will provide the best possible overdraft option and experience to your account holders, while still increasing your non-interest income.nnJMFA OVERDRAFT PRIVILEGEu00ae offers a 100% compliance guarantee, providing regulatory updates to you and your program as needed. Plus, JMFA clients have access to on-site training and continuing education opportunities to help them get the most out of the program u2014 responsibly.nnAll of these things combined help ensure that your institution is following best practices and regulations at all times. And that peace of mind means youu2019re always doing right by your account holders when it comes to overdraft services.nnu0026nbsp;nnu0026nbsp;nnu003chr /u003ennu0026nbsp;nnu0026nbsp;nnu003cstrongu003eABOUT THE AUTHORu003c/strongu003enCheryl Lawson is executive vice president of compliance review for John M. Floyd u0026amp; Associates. She serves as JMFAu2019s principal compliance liaison for regulatory requirements of overdraft services, including consumer protection issues, and strategies that enhance safety and soundness. Learn more aboutu00a0u003ca href=u0022https://www.jmfa.com/About-JMFA/Executive-Team#lawsonu0022u003eCherylu003c/au003e.nnu0026nbsp;nnu003cstrongu003eABOUT JOHN M. FLOYD u0026amp; ASSOCIATES (JMFA)u003c/strongu003enFor the past 38 years JMFA has been considered one of the most trusted names in the industry helping community banks and credit unions improve their performance and profitability. Whether itu2019s recovering lost revenue, uncovering savings opportunities, serving your account holders better, finding the perfect personnel fit or delivering a 100% compliant overdraft program, JMFA has the right solutions to help you not only meet, but exceed, your goals. We are proud to be a preferred provider among many industry groups. To learn more pleaseu00a0u003ca href=u0022https://www.jmfa.com/About-JMFA/Contact-Us-Todayu0022 target=u0022_blanku0022 rel=u0022noopeneru0022u003econtact your local representativeu003c/au003eu00a0or call us at (800) 809-2307.