Regulation E

Question 1

If there is electronic funds transfer activity, how often must a periodic statement be sent to the consumer?

Answer 1

At least monthly

Question 2

Is withdrawing cash from an ATM considered an EFT?

Answer 2

Yes

Question 3

How many days after a notification of an error does an institution have to resolve the error without providing a provisional credit of the amount in question?

Answer 3

10 Business Days

Question 4

How long does an institution have to resolve an error if it cannot be resolved within 10 Business days.

Answer 4

45 Calendar Days

Provisional credit must be provided.

Question 5

How many business days after the transmittal of a notice that an error did not occur, and that a provisionally credited amount will be deducted from the account, must the institution continue to honor certain debit transactions to the account?

Answer 5

5 Business Days

Question 6

In what year was the Electronic Funds Transfer Act written?

Answer 6

1978

Question 7

Which part of Title 12 of the Code of Federal Regulations is Regulation E?

Answer 7

1005

Question 8

What entity is given the authority to enact the provisions of the Electronic Funds Transfer Act?

Answer 8

Consumer Financial Protection Bureau

Question 9

Under Regulation E, what is the maximum amount of liability to a consumer if they report a lost or stolen ATM card within two banking days after learning of the loss?

Answer 9

$50

Question 10

What is the asset size found in Regulation E for a financial institution to be considered a small financial institution and, therefore, not subject to some portions of the Regulation?

Answer 10

$100 Million

Question 11

What is the maximum amount of time a financial institution has to correct an EFT error?

Answer 11

within 30 business days of completing their investigation.

Question 12

What is the maximum amount of time a financial institution can hold a consumer’s funds if there is an EFT dispute?

Answer 12

for up to 20 business days while they investigate an EFT dispute

Question 13

What information must a financial institution provide to a consumer when they open an account that allows for EFTs?

Answer 13

• Terms and conditions of the account.
• Fees associated with EFTs
• The right to dispute EFT errors

Question 14

Are wire transfers covered by Regulation E?

Answer 14

No

Question 15

If a stop payment is made orally, FI may require written confirmation within how many days?

Answer 15

14 Days

Question 16

How many days must a consumer report an unauthorized electronic fund transfer that appears on their periodic statement to avoid liability for subsequent transfers?

Answer 16

60 Days

Question 17

Definition of an “Error”

Answer 17

• Unauthorized electronic fund transfer
• Incorrect EFT to/from consumer’s account
• Omission of an EFT from periodic statement
• Computational/bookkeeping error by financial institution relating to an EFT.
• Consumer’s receipt of incorrect amount of money from an electronic terminal
• EFT not identified in accordance with terminal receipts or periodic statements

Question 18

How many days does a FI have to determine if an error occurred?

Answer 18

10 Business Days
Correct within one business day
Report results within three business days

Question 19

If investigation finds no error or different error: Debit provisional credit (if provided) and…

Answer 19

• Notify consumer of date of debit and amount
• Notify consumer that FI will honor certain items for five business days, or when
  account will be debited five business days from the transmittal of the notification
• Specifying the calendar date on which the debiting will occur

Question 20

If investigation finds no error or different error:

Answer 20

• Provide written explanation of findings within three business days
• Provide copies of documents used in investigation
• If requested by consumer

Question 21

This type of EFT is when a consumer uses a debit or payroll card to pay for merchandise, and the merchant deducts the purchase price from the consumer’s account electronically. This can include on site or online transactions. A receipt is not required if the amount of the transfer is $15 or less.

Answer 21

Point of Sale - POS

Question 22

This type of EFT is when a consumer has an arrangement to have funds automatically withdrawn or to have funds directly deposited.

Answer 22

Preauthorized Transfer

Question 23

This type of EFT is any payment made by a consumer under a bill paying service by electronic means, unless the terms of the bill payment service explicitly state that all payments will be made solely by check or other paper instruments.

Answer 23

Transfers Made Through Bill paying Services

Question 24

Is writing a check that is run electronically considered an EFT?

Answer 24

Yes

Question 25

How many days’ notice is required if the terms of the EFT service will change that provides greater liability for the consumer?

Answer 25

21 Days

Question 26

Are all direct withdrawals and direct deposits made from a consumer’s account by outside parties covered by Red E?

Answer 26

Yes

Question 27

Someone has been notified by their life insurance company that their quarterly premium is past due. This was to have been the first payment made to the life insurance company since they authorized a direct pay agreement with his financial institution. No ATM, debit, or payroll card is involved. Is this EFT covered or not covered by the institution?

Answer 27

It is Covered!

Question 28

A man left the country for deployment with the armed forces. He arranges for weekly deposits to be made to his wife’s checking account from his savings account. Both of their accounts are the same institution. Is this EFT covered or not covered by the institution?

Answer 28

Not Covered!

Question 29

What are some common Reg E Exceptions?

Answer 29

• Check guarantee or authorization
• Domestic wire transfers
• Telephone initiated transfers

Question 30

What is an automatic transfers by agreement Reg E Exception?

Answer 30

Between a consumer’s accounts within the same financial institution.

Question 31

What are some security or commodity transfer Reg E Exceptions?

Answer 31

• Purchased or sold through a broker-dealer regulated by the SEC or CFTC.
• Regulated by the Securities and Exchange Commission. (SEC)
• Regulated by the Commodity Futures Trading Commission (CFTC)
• Held in a book entry form by a Federal Reserve Bank or Federal Agency.

Question 32

What is the difference between a debit card and an ATM card?

Answer 32

• An ATM card does not have the Visa or Mastercard logo and can only be used with a PIN #.
• A debit card has a Visa or Mastercard logo on the face of the card. This card can be used to make purchase at most stores, restaurants, and online.

Question 33

What is the limit to the consumer’s liability for an unauthorized EFT?

Answer 33

$50 unless the consumer fails to notify the depository institution in a timely fashion. If the consumer does not notify in the appropriate time, the amount may be unlimited.

Question 34

If a card is lost or stolen how soon does the consumer have to notify their financial institution?

Answer 34

• Within 2 business days from when they learn that the access device is lost or stolen.
• Within 60 calendar days from the date of the periodic statement which listed the unauthorized transfer.

Question 35

How often must procedures for the consumer to follow in case of errors or questions about transactions must be mailed?

Answer 35

At least once each calendar year.

Question 36

Receipts must be made available when a consumer initiates an EFT exceeding what dollar amount at an electronic terminal?

Answer 36

$15

Question 37

EFT Receipts must contain the following information…

Answer 37

• Amount of transfer
• Date of transfer
• type of transfer
• type of account(s)
• A number or code that identifies the consumer’s account.
• terminal location

Question 38

For a terminal receipt does the balance the consumer sees include the amount offered by an overdraft protection program?

Answer 38

No!

Question 39

What 3 types of documentation are institutions required to provide for consumers for EFT Transactions?

Answer 39

• Terminal Receipts
• Monthly Periodic Statements
• Notice of Recurring Transactions

Question 40

For preauthorized bill payments, the financial institution or payee must provide in how many days in advance notice of the amount and date of the transfer?

Answer 40

10 Days in Advance

Question 41

Can a loan be conditioned on the consumer’s repayment by preauthorized Electronic Funds Transfer?

Answer 41

NO!

Question 42

This allows a transaction to go through even when its associated account has insufficient funds.

Answer 42

Overdraft protection

Question 43

If an institution doesn’t provide a periodic statement, it must provide the following…

Answer 43

• A telephone line for account balance information
• Access to an electronic or written account history covering at least 60 days

Question 44

Dormancy, inactivity, and service fees may only be assessed for a gift card if…

Answer 44

• There has been at least one year of inactivity
• No more than one such fee is charged per month
• The consumer is given clear and visible disclosures about the fees on the gift certificate or gift card.

Question 45

A financial institution may not issue a gift card that has an expiration date of?

Answer 45

Less than five years after the card is issued or the funds are last loaded, whichever is later.

Question 46

Is a prepaid card that is not associated with the Customer Identification Program (CIP) covered under Reg E?

Answer 46

No!

Question 47

Sebastian has just signed up for electronic transfer services through your organization. When must he receive the required disclosure to ensure compliance with Regulation E?

Answer 47

The disclosure should be given to the consumer before the first EFT is made.

Question 48

What type of EFT error is this:

Miles withdraws $20 in cash from a drive thru ATM. His receipt says he withdrew $200.

Answer 48

Incorrect EFT

Question 49

What type of EFT error is this:

Rose completes an electronic transaction at her ATM on Irvine Ave. However, her credit union’s records state that she made her transaction on W. Balboa Blvd.

Answer 49

Improper Identification of EFT

Question 50

What type of EFT error is this:

Melissa checks her periodic statement each month and balances her checkbook against it. However, this month her statement is missing the EFT she used to pay her gym membership.

Answer 50

Omission of EFT on Periodic Statement

Question 51

What type of EFT error is this:

Chase bank is experiencing a computer glitch that adds two zeros onto the end of each electronic transaction completed by customers.

Answer 51

Computer or Bookkeeping Error

Question 52

An institution must report the results of an investigation to the consumer within how many days of concluding the investigation?

Answer 52

3 Business Days.

Question 53

Regulation E allows a financial institution to have more time to investigate and resolve alleged errors, provided the institution has disclosed this additional time provision to consumers, if:

Answer 53

1. An EFT was not initiated in the USA
2. If it is a POS card transaction
3. New Account

Question 54

If the error notice involves an EFT that occurred within 30 days of the first deposit to the affected new account, the institution must determine whether or not an error occurred within how many days of receipt of the notice?

Answer 54

20 Business Days