Reg E-Electronic Funds Transfer Act Flashcards
What are some of the requirements of Reg E?
- consumer disclosures
- procedures related to resolving errors or disputes related to EFTs
- limitations on consumer liability when a card is lost or stolen
- bank actions related to EFTs to or from consumer asset accounts
True or False
Reg E relates to both consumer and commercial account.
False
The reg does not cover commercial, escrow or trust accounts
True or False
Reg E covers transactions made at electronic terminals, telephones, computers, or magnetic tapes.
True
EFTs include:
- point of sale (POS) transfers (both PIN based and signature based)
- ATM transfers
- direct deposits or withdrawals of funds (ACH)
- transfers initiated by telephone
- transfers resulting from debit card transactions, whether or not initiated through an electronic terminal
The term “account” includes:
- checking, savings or other consumer asset account held by a bank established primarily for personal,family or household purposes
- payroll card account, established through an employer, to which EFTs of the consumer wages, salary or other employee compensation are made on a recurring basis
Which are NOT considered unauthorized electronic funds transfer?
A)EFT made by someone other than the consumer and a person that the consumer did not give authority to access the account
B)Debit card is stolen or obtained by fraud or if the consumer is forced to make a transaction at an ATM
C)by someone who the consumer gave the access device to
D)made with fraudulent intent by the consumer or any person acting in concert with the consumer or by the bank or a bank employee
C and D
True or False
Reg E disclosures must be separate from other disclosures.
False
Disclosures may be combined with that required by other laws such as the truth in lending act or truth in savings act as long as it is clear and understandable and in a written form that consumers can keep.
What disclosure must be provided before the first EFT is made or at the time the consumer contracts for an EFT service?
Initial disclosure of the terms and conditions
True or False
Banks do not have to honor initial disclosures incorrectly given to non-covered accounts.
False
Bank may create a contractual obligation to give non-covered accounts the same types of protections related to errors and liability as consumers have if disclosure does not specifically notate as being limited to consumers.
When must a change in terms disclosure be given?
The bank must mail or deliver a written or electronic notice to the consumer at least 21 days prior to the change effective date.
What is considered a change in terms?
- increased fees or changes
- increased liability for the consumer
- fewer types of available EFTs
- stricter limitations on the frequency or dollar amounts of transfers
Changes in terms that don’t fall under those categories don’t require any additional notice.
When must accountholders receive an error resolution notice which provides information about how to report errors?
It must be given annually or at the banks option it may be provided on each periodic statement.
True or False
Under reg E, periodic statements are always required monthly.
False
Periodic statements are required for each monthly cycle in which an EFT has occurred. If no EFT has occurred on the account, the periodic statement must be sent at least quarterly.
What transactions are considered under overdraft requirements in reg E?
Solely ATM and one time debit card transactions
A bank must provide either the model form (A-9) or a substantially similar form prior to charging any overdraft fees. What must be included in the form?
- a description of the overdraft service
- fees related to the service
- maximum amount of fees that can be charged per day or the information that there is no limit
- alternative methods the bank offers for covering overdrafts
