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FDIC Consumer News - Summer 1998

Important Update: Changes in FDIC Deposit Insurance Coverage

The FDIC deposit insurance rules have undergone a series of changes starting in the fall of 2008. As a result, certain previously published information related to FDIC insurance coverage may not reflect the current rules. For details about the changes, visit Changes in FDIC Deposit Insurance Coverage. For more information about FDIC insurance, go to www.fdic.gov/deposit/deposits/index.html or call toll-free 1-877-ASK-FDIC (1-877-275-3342). For the hearing-impaired, the number is 1-800-925-4618.

What is and What is Not Insured?

Are you confused by all the new and different types of products offered by your bank after its merger with another institution? “With all the diverse products a bank can offer—deposits, securities, insurance—the potential exists for consumer confusion over which products are insured and which are not insured if the bank doesn’t make the appropriate consumer disclosures,” says Marilyn Anderson, a senior counsel at the FDIC.

That’s why we’re reminding you that nondeposit investment products are not insured by the FDIC against loss. The FDIC and other federal regulators, starting in 1994, have sought to ensure that banks and savings associations explain to consumers that nondeposit investments aren’t insured. Learn more by getting a copy of the FDIC brochure “Consumer Facts about Investments,” available from the Public Information Center or on the Internet.

Law Aims at Protecting Consumer Privacy After a Bank Merger

Some consumers might like the idea that if their bank becomes part of a “financial conglomerate” (one company that owns a bank, an insurance company, a brokerage firm, etc.) they may find a wider array of financial products and potentially lower prices. But other consumers have concerns about these companies sharing personal financial information and following up with unsolicited sales calls or mail. To address these questions, Congress in 1996 adopted amendments to the Fair Credit Reporting Act. The amendments require companies to give consumers advance notice of plans to share personal financial information with other parts of the company. If a consumer objects, his or her personal information cannot be shared.

As FDIC Vice Chairman Andrew C. Hove, Jr., told Congress in April, “this mechanism has not been tested long enough to assure consumers that it can adequately protect the privacy of their personal financial information.” If you have concerns that a bank or bank affiliate is sharing personal financial information without your permission, contact the institution directly. If you’re still not satisfied, you may get in touch with the institution’s primary federal regulator.

Also, for various tips about limiting unsolicited offers of credit cards, insurance and other products and services, see our winter 1997/98 issue, which is available from the Public Information Center or on the Internet.

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Last Updated 07/30/1999 communications@fdic.gov