CFPB EFT FAQ Coverage Transactions 4 – Is a credit-push P2P payment that transfers funds out of a consumer’s deposit, prepaid, or mobile account considered an EFT?

Compliance > Regulation E - EFTA
Q:  Is a credit-push P2P payment that transfers funds out of a consumer’s deposit, prepaid, or mobile account considered an EFT?
 
A:   Yes. As discussed in Electronic Fund Transfers Coverage: Transactions Question 1, Regulation E applies to any EFT that authorizes a financial institution to debit or credit a consumer's account. 12 CFR 1005.3(a). The term EFT means any transfer of funds that is initiated through an electronic terminal, telephone, computer, or magnetic tape for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit a consumer's account. 12 CFR 1005.3(b)(1). A credit-push P2P payment is considered a transfer initiated through an electronic terminal, telephone, or computer for the purpose of ordering, instructing, or authorizing a financial institution to debit a consumer's account, and accordingly is an EFT.
 
A credit-push P2P transfer is considered an EFT even if the payment was initiated by a third party that fraudulently obtained access to consumer’s account, such as by using login credentials stolen in a data breach or obtained through fraudulent inducement. In these cases, the credit-push P2P transfer would be considered an unauthorized EFT. See Electronic Fund Transfers Error Resolution: Unauthorized EFTs Question 1 for more information on the definition of an unauthorized EFT.
 
 
This Q&A was contained in the CFPB’s Electronic Fund Transfers FAQs that were updated in December 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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