I was recently surprised to get a letter from my bank chastising me for too many electronic transfers and threatening to either report me to some government agency or close the account. I am shattered to think that I now live in a country where I can't even conduct routine banking without big brother looking in. Since interest rates on these accounts are a joke anyway, I am thinking about just taking the cash out and keeping it in a safe deposit box. I must wonder, however, if my withdrawal would also be reportable to big brother? This may seem silly to you but for anyone in their 50's or 60's, this kind of government intrusion is beyond belief and downright scary!

Anon - it sounds like you hit the 6-transaction limit on a "non-transaction" account (something other than a checking account). Regulation D limits non-personal transactions on these types of accounts to 6 per month (3 per month for certain types).

"Non-personal" transactions include transfers to pay check overdrafts, internet banking transfers, telephone transfers, automatic debits to the power company and other vendors, and just about anything you request when you're not physically present at the bank or an ATM.

Check your account agreement, it will probably have more information about what kinds of transactions you can do on each type of account, and the monthly limits for each.

The purpose of the transaction limit required by the Regulation is to drive "transactions" through actual "transaction" accounts (i.e.: checking accounts).

All banks are required by the Regulation to hold reserves on all funds in transaction-class accounts to kind of "make up for" the way we give immediate credit on checks you deposit, but for which we haven't yet received the funds from the drawer's bank. It's a bit of a safety net in case something happens to the checks in transit from one to the other (on a large scale).

But what it comes down to is the Fed doesn't want savings accounts (not reserved) used as checking accounts (with reserves). And they make us monitor your account to make sure everyone's within limits.

Contact your branch manager to see what techniques you can use so you don't hit that 6-transaction mark. They may have options you are unaware of.

Are banks required to report withdrawals under any Reg?
If so, what gets reported?
Again, if so, is there a distinction between checking and savings withdrawals, as related to repo :confused:rting?

The transactions are not reported to anyone. Under the banking regulation, they must be in a position to stop the excessive transfers from savings account. These accounts include what you think of as a traditional savings account as well as Money Market accounts. Your checking and NOW accounts are not limited unless your bank has imposed one.

This relates back to the ability to monitor the money supply and control it.

Additionally, talk to your bank about in-person withdrawals. Those may be unlimited and you can go to a branch and move funds to your checking account as often as you wish. Inconvenient you say. Yes. They wrote the law to do just that.

Anon - if it makes you feel any better, "big brother" is not going to do anything to you for these excess withdrawals, but "big brother" will penalize the bank for allowing it to happen.