On July 31st, 2024, the FDIC hosted the second of four webinars aimed at bank officers, employees, and other stakeholders. These webinars are designed to provide guidance on the final rule governing FDIC Official Signs and Advertising Statements, Misrepresentations of Insured Status, and Misuse of FDIC’s Name or Logo.
Background and Purpose of the Final Rule
While they covered this in the first webinar, they restated the purpose of the final rule, which modernizes the FDIC’s requirements regarding the use of official signs and advertising statements. It aims to enhance consumer understanding and confidence in FDIC insurance coverage across various banking channels, including digital platforms.
Key Objectives:
- Ensure clear identification of FDIC-insured banks and their products.
- Mitigate consumer confusion regarding deposit and non-deposit products.
- Address misleading representations about FDIC insurance.
Updates from the Webinar
New FDIC Official Digital Sign Requirements
Application to Digital Channels:
- Websites and Mobile Apps: By January 1, 2025, banks must display the FDIC official digital sign on their homepage, landing/login pages, and any pages where transactions with deposits occur. This sign must be clear, continuous, and conspicuous, ideally placed near the top of the page and close to the bank’s name.
- ATMs: Deposit-taking ATMs must display the digital sign on the home screen and each transaction screen related to deposits. For ATMs in service before January 1, 2025, banks can use the physical FDIC sign, but new ATMs must use the digital version.
Design and Display:
- The digital sign should generally be displayed as presented in the final rule, all in one line. However, it can be scaled, wrapped, or stacked to fit smaller screens, provided it remains clear and conspicuous.
- If the digital sign's background color affects visibility, it can be displayed in white.
No Substitution with Advertising Statement:
- The digital sign requirement does not overlap with the general advertising statement requirement (e.g., “Member FDIC”). Both can be displayed, but the digital sign must be used on specified pages.
Clarifications on Non-Deposit Product Signage
Definition and Display Requirements:
- Non-deposit products, which include insurance products, annuities, mutual funds, securities, and crypto assets require special attention under the new requirements. Credit products and safe deposit boxes are excluded.
- Banks must segregate non-deposit areas from deposit-taking areas and display non-deposit signs clearly stating these products are not FDIC-insured, not deposits, and may lose value.
Proximity and Placement:
- Non-deposit signs cannot be placed close to the FDIC official sign to avoid confusion. They should be conspicuous and continuously visible on pages offering non-deposit products.
Misrepresentations and Use of FDIC’s Name and Logo
Scope and Examples:
- Subpart B of Part 328 applies to all persons, including non-banks. It prohibits false advertising and misrepresentations regarding FDIC insurance.
- Examples include non-banks using the FDIC sign or logo incorrectly, implying FDIC insurance on non-deposit products, and failing to disclose the conditions for pass-through deposit insurance.
Enforcement:
- The FDIC can take enforcement actions, including cease-and-desist orders and civil money penalties, against entities that violate these rules.
Policies and Procedures
Development and Implementation:
- Banks must develop written policies and procedures to ensure compliance with both subparts A and B of Part 328. These policies should address monitoring and evaluating third-party activities related to deposit products.
- The procedures should also include steps to mitigate any potential misrepresentations about FDIC insurance.
Third-Party Risk Management:
- Consistent with interagency guidance on third-party risk management, banks are responsible for ensuring that third parties comply with the FDIC’s rules.
Consumer Awareness and Public Campaigns
Public Awareness Campaign:
- The FDIC has launched the “Know Your Risk, Protect Your Money” campaign to educate consumers about how deposit insurance works. This complements the new rule by promoting understanding and confidence in FDIC insurance.
Q&A Highlights from the Webinar
View all Questions and Answers Related to the FDIC’s Part 328 Final Rule Here.
Common Clarifications:
- Landing/Login Pages: Defined as pages where customers enter their credentials to access digital banking services.
- Non-Deposit Notification: A one-time notification is required when a logged-in customer accesses non-deposit products through a third-party website.
- ADA Compliance: Banks must ensure that their digital content, including the new signage, complies with ADA requirements.
- Dashboard/Portal: Dashboards summarizing account information do not require the FDIC official digital sign unless transactions can be made directly from these pages.
- Scalability and Translation: The digital sign can be scaled to fit different screens and banks can request approval from the FDIC for non-English translations of the advertising statement.
Implementation and Resources
Banks are encouraged to start implementing the rule's requirements ahead of the January 1, 2025 compliance date. The FDIC has published a set of FAQs on their website to assist with common questions and will continue to update these resources as new questions arise.
Upcoming Seminars
This webinar is the second in a series of four planned for 2024, aimed at providing further guidance and addressing questions from stakeholders. If you missed our recap of the first webinar, be sure to check it out. Future seminar dates will be announced on the FDIC's banker seminar webpage. We recommend you bookmark this page and check back often (or sign up for our email updates, and we’ll be sure to let you know as soon as we know)!
For more detailed information, banks can access the full webinar slides and the FDIC's FAQ page through the FDIC website.
By understanding these updates and taking proactive steps, banks can ensure they meet the FDIC’s new requirements, thereby protecting consumer trust and maintaining regulatory compliance.
Our WSI Bank Website Customers are in Good Hands
Given our focus on banking and building great bank websites, it’s hopefully evident from our participation in these webinars and our recaps that we’re committed to understanding how these updated requirements impact our clients. We remain on top of updates and have even taken time to share feedback directly with the FDIC.
If your bank is looking for a partner like WSI who’s proactively focused on not just FDIC requirements, but other trends in website and digital marketing strategies, let’s chat. We’d love to discuss your online goals - and what may be holding you back from achieving the success you deserve when it comes to all your digital efforts!
Quick Overview - Key Differences
Here's a comparison of the key points from the first and second FDIC webinars on the final rule governing FDIC Official Signs and Advertising Statements, Misrepresentations of Insured Status, and Misuse of FDIC’s Name or Logo.
- Focus: The first webinar provided an introduction and broad overview of the final rule and its objectives, while the second webinar focused more on detailed compliance guidance and addressing specific questions from stakeholders.
- Content Depth: The second webinar went deeper into the practical aspects of implementing the rule, including examples and scenarios for digital and physical channels.
- New Information: The second webinar included updates on implementation activities, additional resources, and the announcement of future FAQs and webinars.
