Has anyone rejected a Reg. E Claim? We have a situation in which a customer verbally told a bank representative that he was drunk when he gave out his PIN and ATM Card to a young lady he was courting for the night. The written affidavit however tells a different story. The affidivait details a stolen card and PIN locted in a seperate location by this young lady.

Any thoughts on how to proceed with this claim?

Sure you can reject a Reg E claim.

§205.2(m) states an "Unauthorized electronic fund transfer means an electronic fund transfer from a consumer’s account initiated by a person other than the consumer without actual authority to initiate the transfer and from which the consumer receives no benefit. The term does not include an electronic fund transfer initiated:

a) By a person who was furnished the access device to the consumer’s account by the consumer, unless the consumer has notified the financial institution that transfers by that person are no longer authorized;
b) With fraudulent intent by the consumer or any person acting in concert with the consumer; or
c) By the financial institution or its employee.

If he gave out his PIN and ATM card, the transactions are NOT unauthorized. I would have the bank representative document what was verbally told by the customer and then reject the claim for this information.

Just FYI. Being drunk doesn't increase the customer's liability. If someone stole his billfold while he was passed out, it's still unauthorized. I believe John Burnett once said (something like) Regulation E protects the ill advised, careless and even the stupid.