Customer dies. Card transactions (that we assume were authorized prior to death) post to account after date of death. Beneficiary comes in to claim the funds and notices these transactions hit the account after the date of death. Can the beneficiary dispute these? Card is not technically in beneficiary's name...

The facts suggest that the account was a POD or Totten trust type account, in which a beneficiary has no ownership interest at all until the account owner dies. If you check those transactions out and verify they were authorized on or before the date of death, I don't think the beneficiary has any standing to challenge them. He or she would not be in a position to say they weren't authorized.

Depending on the use of the term "beneficiary" on the OP if this is the person now handling the estate, these debits may be payment for just debts which would have to be paid anyway. Just throwing that out as a possibility.

If the individual taking over control of the account is the executor, administrator or other personal representative of the estate of the deceased account holder, my opinion is that he or she could inquire into the nature of the transactions and challenge as unauthorized any that were initiated after the owner's death. In practice, transactions that would have to be paid from the estate anyway (as Andy mentioned) wouldn't get challenged.

Thanks, guys!

We have a situation where the personal representative of the estate is disputing transactions that were posted after the account holder's death and ths same date we were notified of their death. These transactions were pre authorized prior to the account holder's death and to us being notified of the account holder's death.

My assumption is Reg E would not apply but what is our liability if any to the personal representative's claim?

Any takers?

Bump

As a general rule, a bank is not responsible for preventing such transactions until after it has knowledge (or can be shown to have reason to have such knowledge) of the account holder's death.

You can respond to the error claim that the transactions were authorized based on your investigation, and that you did not have knowledge of the death until (date).

Thank you