Electronic Fund Transfers FAQ 8 – If a transfer meets the Regulation E definition of unauthorized electronic fund transfer, how does a financial institution determine the consumer’s liability, if any?

Compliance > Regulation E - EFTA
Q:   If a transfer meets the Regulation E definition of unauthorized electronic fund transfer, how does a financial institution determine the consumer’s liability, if any?
 
A:   (UPDATED 6/4/2021): If a consumer has provided timely notice of an error under 12 CFR § 1005.11(b)(1) and the financial institution determines that the error was an unauthorized electronic fund transfer (EFT), the liability protections in Regulation E, § 1005.6, would apply. Depending on the circumstances regarding the unauthorized EFT and the timing of the reporting, a consumer may or may not have some liability for the unauthorized EFT. See 12 CFR § 1005.6(b).
 
 
This Q&A was contained in the CFPB’s Electronic Fun Transfers FAQs that were released in June 2021 (which may be updated from time to time).  This may be found on the CFPB’s website here:  https://www.consumerfinance.gov/compliance/compliance-resources/deposit-accounts-resources/electronic-fund-transfers/electronic-fund-transfers-faqs/
 

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