Can I deny an ATM W/D Dispute solely on the fact that the PIN was used?

Customer has a history, I know him from other FIs I've worked at, of going to a foreign country and living it up. Every time he goes he comes back with an ATM dispute because "they cloned my card down there and used it at the ATM".

How did they obtain your PIN then?

I realize Reg E doesn't tell me what constitutes a denial (http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=1738483), just curious about your opinions.

Does the use of the PIN give me recourse?

Customer has a history, I know him from other FIs I've worked at...

OK - stupid question. Why does he even have a card at your bank???

Because my desk isn't big enough to know who is opening an account each day. I have personal knowledge of the guy, as does the new accounts person who opened the account. She certainly doesn't have the authority to say "no"; and probably didn't think about the disputes from the other FI.

I just found out he is here now. Aside from recommending that the account be closed, what do you think about whether or not I can deny based solely on the PIN being used?

I don't disagree with Randy's comment.

It's difficult to successfully argue for denying the claim based on information you happen to have from former employment at other card issuing banks. There's nothing in the current bank's data to back up the argument.

I'm going to assume that whoever approved the issuing of a card to this guy wasn't aware of the information you had from your former jobs. So I will cut whoever that is some slack.

But now that your knowledge can be shared with others at your bank, I do think it would be misguided to let this person have another card.

Since the interpretations to the Reg say that you cannot increase the liability for a customer who writes their PIN on the back of the card, it is clear that the fact that a PIN was used cannot be the sole reason for denying a claim.

Good input, from all.

In this case, we are dealing with...

- A couple thousand dollars worth of claims (all within the same week period).
- A very low probability that this 2nd world country will provide us with security footage of their ATM.

Looks like we get to eat the loss and then close the card.

Was he in country or in the foreign country at the time?

Based on past knowledge of the customer hopping from bank to bank and pulling the same stunt, I would just close his account and say basically "sorry, not this time" which is basically "sue us", at which point you subpoena the other banks to testify.

While I am all for the consumer protections offered by Regulation E and 99% of the time I would error in favor of the consumer. But in this case, I would roll the dice and stick it to this gentleman.

Yes; Central America.

I've heard this guy say that the ATM's down there don't require a PIN number, but our processor shows otherwise.

Thanks Randy.

I've been in many Central American countries - he is blowing smoke. Document that statement also in your documentation just to show that he is trying to scam you.

An ATM withdrawal without a PIN - yeah right.

There has been an awful lot of ATM skimming in South America and Mexico. Thought you might like to know that there has certainly been counterfeit cards made after being used at ATMs- that they have the PIN, too. I have seen these turn around in a matter of days- conducting ATM withdrawals in Mexico and South America- sometimes in US, as well. The ATM skimming in South America and Mexico has been occurring for the past two years- and steadily growing.

I don't think I was indicating that it doesn't happen. It just doesn't happen every time someone visits.