Reg E Questions

Question 1

Regulation E implements what Act?

Answer 1

Electronic Funds Transfer Act of 1978

Question 2

Regulation E establishes

Answer 2

Basic rights and responsibilities of consumers and financial institutions that use electronic funds transfer services.

Question 3

Regulation E applies to

Answer 3

Debit and credit transactions to demand, savings, or other deposit accounts.

Question 4

Regulation E applies to a transfer made via ACH where a consumer has provided a check to enable the merchant or other payee to capture the routing, account and serial numbers to initiate the transfer, where the check is

Answer 4

Blank, partially completed, or fully completed and signed, Presented at the point of sale, or is mailed to a merchant or other payee or lockbox and later converted to an EFT, Retained by the consumer, the merchant or other payee, or the payees financial institution.

Question 5

Regulation E applies to a transfer made via ACH except

Answer 5

Electronic debits and credits to non-consumer accounts.

Question 6

What disclosures are required by Regulation E?

Answer 6

Initial and Periodic

Question 7

DFI must send periodic statement information for each monthly statement cycle in which there is electronic transfer activity on the account; when there is no activity, the periodic statement must be sent

Answer 7

Quarterly.

Question 8

A reversal of a direct deposit to correct an error does not trigger the monthly statement requirement when the error represented a credit to the wrong consumers account, a duplicate credit, or a credit in the wrong amount.

Answer 8

TRUE

Question 9

According to Regulation E, 1 a computation or bookkeeping error by consumers DFI, 2 Consumers receipt of incorrect amount of money at electronic terminal, and 3 an incorrectly identified entry, are all considered errors. From the list below, what else is considered an error according to Regulation E?

Answer 9

Unauthorized transfer, Incorrect Transfer to or from Consumers account, Transfer not included on a periodic statement

Question 10

When a consumer discovers an error on their statement, how long do they have to notify the financial institution?

Answer 10

Oral or written notice from consumer must be received no later than 60 days of the transmittal date of the statement in which the error first appeared.

Question 11

A financial institution may require written notice of error within

Answer 11

10 days of oral notice.

Question 12

Once a financial institution receives notice, the first step is to determine whether an error occurred; and the financial institution must do so within how many days of receiving notice and must report results to the consumer within how many days. Business or Calendar and number of days

Answer 12

10 business days, 3 business days

Question 13

If the financial institution determines during the investigation that an error did occur, the financial institution must correct within

Answer 13

1 business day.

Question 14

If the financial institution is unable to complete the investigation within 10 business days, the institution may take how many days 90 days if not initiated in a state, is a new account, or resulted from a POS debit card transaction from receipt of notice provided they give what including interest within 10 business days of receiving the error notice, informs the consumer within how many days of provisional credit and gives consumer full use of the funds, corrects the error within 1 day of discovery, and reports results to consumer within 3 business days.

Answer 14

45 days, provisional credit, 2 business days

Question 15

If the financial institution determines there was no error, the financial institution must

Answer 15

Notify consumer within 3 business days, Reverse provision credit with 5-day grace period, Supply consumer with information and documents used to determine there was no error.

Question 16

The consumer can limit their liability by notifying the financial institution within

Answer 16

2 business days after learning of the loss or theft.

Question 17

Which of the following is considered a tiers of consumer liability for unauthorized EFTs?

Answer 17

Up to $50, Up to $500, Unlimited amount depending on when the unauthorized EFT occurs

Question 18

Negligence by the consumer cannot be used as the basis for imposing greater liability than is permissible under Regulation E

Answer 18

TRUE

Question 19

Consumer behavior that may constitute negligence under state law, such as writing the PIN on a debit card or on a piece of paper kept with the card, does not affect the consumer liability for unauthorized transfers.

Answer 19

TRUE

Question 20

The extent of the Consumers liability is determined solely by the Consumers promptness in reporting the loss or theft of an access device.

Answer 20

TRUE

Question 21

An agreement between the consumer and an institution may impose greater liability on the consumer for unauthorized transfer than the limits provided in Regulation E.

Answer 21

FALSE

Question 22

The two-business day period for a consumer to be able to limit their liability does not include the day the consumer learns of the loss or theft or any day that is not a business day.

Answer 22

TRUE

Question 23

If the consumer notifies the financial institution of the loss or theft of the access device within the required time frame the Consumers liability will not exceed the lesser of $500 or the sum of

Answer 23

$50 or the amount of the unauthorized transfers that occur within the two business days, whichever is less.

Question 24

Sally is on vacation and her access device is stolen on Monday. Sally uses cash for most of her purchases and does not realize the access device is missing until Thursday morning. Sally reports the loss to her financial institution on Friday. On Monday and Tuesday, the thieves spent more than $1,500 and after that there are no more transactions. What will Sallys loss be?

Answer 24

$50

Question 25

Sally is on vacation and her purse is stolen on Monday around 2:00 p.m. After Sally reports the loss to the police, she notifies her financial institution of the theft around 3:00 p.m. The thieves were only able to spend $25

Answer 25

$25

Question 26

Sallys debit card is stolen on Monday, and she learns of the theft that same day. However, Sally does not contact her institution until Friday. Which tier of liability applies?

Answer 26

Up to $500

Question 27

Sallys access device is stolen on Monday, and she learns of theft that same day. However, Sally does not contact her institution until Friday and a $100 unauthorized transfer was made on Tuesday and a $600 unauthorized transfer was made on Thursday. Because the consumer is liable for the amount of the unauthorized transfers that occur within the first two business days but no more than $50, plus the amount of the unauthorized transfers that occurs after the first two business days and before the consumer gives notice, what is Sallys liability?

Answer 27

$500

Question 28

Sallys access device is stolen on Monday, and she learns of theft that same day. However, Sally does not contact her institution until Friday and a $600 unauthorized transfer was made on Tuesday and a $100 unauthorized transfer was made on Thursday. Because the consumer is liable for the amount of the unauthorized transfers that occur within the first two business days but no more than $50, plus the amount of the unauthorized transfers that occurs after the first two business days and before the consumer gives notice, what is Sallys liability?

Answer 28

$150

Question 29

A financial institution is considered to have received notice for purposes of limiting the Consumers liability if notice is given in a reasonable manner, even if the consumer notifies the institution but uses an address or telephone number other than the one specified by the institution.

Answer 29

TRUE

Question 30

In what year was the Electronic Funds Transfer Act written?

Answer 30

1978

Question 31

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

Answer 31

205

Question 32

Under Regulation E, which of the following is a business day?

Answer 32

Any day of the week the institution is open for carrying on substantially all business functions

Question 33

Which of the following entities is given the authority to enact the provisions of the Electronic Funds Transfer Act?

Answer 33

CFPB

Question 34

Which of the following does Regulation E not exclude from coverage?

Answer 34

Point of Purchase ACH transactions

Question 35

Which of the following is not a requirement relating to the form of the Regulation E disclosures?

Answer 35

Printed in 12 point sized New Times Roman font

Question 36

At what time on the second banking day after learning of the loss of the card must the consumer give notice?

Answer 36

11:59 p.m.

Question 37

Which of the following is not an example of an electronic terminal as defined by Regulation E?

Answer 37

Telephone

Question 38

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 38

$100 Million

Question 39

Which of the following is not required to be included in the Regulation E initial disclosure?

Answer 39

Address of financial institution

Question 40

What date is required to appear on an electronic terminal receipt?

Answer 40

The date the transfer was initiated

Question 41

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

Answer 41

21 days

Question 42

Where is the shortened version of the financial institutions Error Resolution Notice supposed to appear if the financial institution chooses not to send out the annual full version of this notice?

Answer 42

Consumers periodic statement

Question 43

Which of the following is not a notification option to be used by a financial institution for preauthorized credit transfers?

Answer 43

Providing the periodic statement is sufficient notification