Stop Payment Fees For Revoked ACH Transaction
Answer by: John Burnett, BOL Guru BIO AND CONTACT INFO
Question: A customer revokes an ACH transaction claiming they had contacted the originating company to cancel any future transactions and the company did not cancel in time. Is this considered a Reg E error resolution claim? And, is the bank allowed to charge a processing fee for the revocation, similar to that of a Stop Payment Fee?
Answer: Under Regulation E, the customer has until 2 business days before a preauthorized (recurring) debit is scheduled to post to issue a stop order on the payment. That stop need only be valid for one transaction (but several banks I know of treat it as a "standing stop").
There is nothing in the regulation to prevent you from imposing your normal stop payment fee.
Only if the transaction has already posted notwithstanding the customer's revocation of authority for the payment, does the customer's challenge of the transaction become an error resolution claim.
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