CFPB EFT FAQ Error Res Unauth EFTs 2 – If a transfer meets the Regulation E definition of unauthorized EFT, 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 EFT, how does a financial institution determine the consumer’s liability, if any?
 
A:   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 EFT, the liability protections in Regulation E section 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 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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