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Does Reg E Apply to Business Customers?
by Richard Insley and John Burnett, BOL Gurus
Question: Do business customers that receive a debit card fall under Regulation E disclosure requirements? The definition of customer within the regulation doesn't seem to include them.
Answer by Richard Insley:
BIO AND CONTACT INFO
Reg. E does not cover EFTs with anyone other than a consumer (defined as "a natural person.")
Answer by John Burnett:
BIO AND CONTACT INFO
To refine that even further, Reg. E applies to accounts of natural persons that are opened and maintained primarily for person, family, or household purposes.
So a business account of a sole proprietor (a natural person) would not be covered. But I suggest you treat such an account as subject to the regulation unless you clearly identify it as a business account, and include language in your account agreement that the account will be used principally for business purposes.
First published on BankersOnline.com 8/4/03
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