WASHINGTON — With surveys showing substantial consumer confusion about federal insurance of mutual funds sold by banks, the Federal Deposit Insurance Corp. on Tuesday proposed new rules for bank advertisements.
Under the proposal, banks would have to clearly segregate insured products, such as checking accounts, from uninsured products, like mutual funds, in their ads. Banks would be prohibited from mentioning FDIC insurance in ads solely concerning uninsured products.
Some regulators questioned whether the proposal, released for comment at an FDIC board meeting, would do much to alleviate the widespread confusion.
"The area of disclosure is extremely complex in terms of what the consumer actually feels and learns," Comptroller of the Currency Eugene Ludwig said after the meeting. "I'm very wary that we not impose burdens unless we are generally getting some benefit out of it."