Visa Debit Card ATM Fraud - Reg E or Visa Rules?
by John Burnett, BOL Guru Guru Bios
Question: I am Controller at a large financial institution. Under Reg E, if someone claims fraud on a Visa debit card ATM withdrawal transaction does the $50 initial liability provision of Reg E apply or is does Visa's zero liability? Debit card was used as an ATM card.
Answer: Visa's zero liability policy does not cover ATM transactions. It only covers purchase transactions by a consumer, when those transactions are routed via the Visa network. In most cases, that means it has to be a signature-based debit card merchant purchase.
Regulation E's provisions will always apply to a consumer transaction with a debit/ATM card. Whether Visa's rules will provide added protection to the consumer will depend on the type of transaction involved.
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