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#1297473 - 12/02/09 08:43 PM Reg E Visa Debit Card Help Needed
Christina the Auditor Offline
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Joined: Sep 2006
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We have a customer who came in yesterday with various unauthorized VISA Debit card transfers (no use of access device) appearing on his statements. These unauthorized charges go back to this summer, and he openly admitted that he doesn't have time or take the time to open his statements and review them. To me this seems like negligence.

If I understand the reg correctly, he has unlimited liability for all transfers that occurred 60 calendar days after the periodic statement and before notice to us. What is he liable for? I guess I don't understand what statement cycle the reg is referencing.

Thanks!!!

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#1297484 - 12/02/09 08:49 PM Re: Reg E Visa Debit Card Help Needed Christina the Auditor
rlcarey Online
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It would be the transactions that occurred after 60 days from the delivery of the periodic statement that contained the first unauthorized transaction.
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#1297491 - 12/02/09 08:54 PM Re: Reg E Visa Debit Card Help Needed rlcarey
David Dickinson Offline
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I agree it's logical to call this negligence, but the Regulation says it is not. These unauthorized transactions would have occurred whether he told you sooner or later. As Randy stated, you're liable for all authorized transactions occurring between the date of the first statement (showing the first error) until 60 days following that statement date - no matter when he tells you.

If there's no reoccurring transactions, you're liable for all of them and he's liable for none. Again, this would have been the same had he told you right away.
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#1297548 - 12/02/09 09:37 PM Re: Reg E Visa Debit Card Help Needed David Dickinson
Christina the Auditor Offline
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So if the first statement date was June 30, we would be liable for July 1 - August 29 transactions? And he would be liable for everything up until now? However, if the transactions are all different (i.e. different merchants or different amounts), we would be liable for all of them (basically reimburse him for everything?).

Thanks so much for your help. I really appreciate it!!!
Last edited by Christina the Auditor; 12/02/09 09:39 PM.
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#1297838 - 12/03/09 03:13 PM Re: Reg E Visa Debit Card Help Needed Christina the Auditor
David Dickinson Offline
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You are correct on everything you said except your liability window is not 7/1-8/29. It is June 1st - 8/29.
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#1297845 - 12/03/09 03:15 PM Re: Reg E Visa Debit Card Help Needed David Dickinson
Christina the Auditor Offline
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Makes sense...thanks again!

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#1298584 - 12/03/09 10:57 PM Re: Reg E Visa Debit Card Help Needed Christina the Auditor
C_Groat Offline
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Joined: Mar 2006
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Salt Lake City, UT
Not following/do not agree with "If there is no reoccurring transactions, you're liable for all of them and he is liable for none" / "if the transactions are all different (i.e. different merchants or different amounts), we would be liable for all of them (basically reimburse him for everything?)"


The bank's liability is 60 days from the statement date in which the first unauth'd transaction appears - If Joe Customer is not reviewing his statments for 8 months and has 100 fraudulent trans from various merchants over that 8 month period with 20 occurring in the first 60 day period, I'm holding him liable for the remaining 80 trans as we could have prevented the additional losses if he did report the unauth'd transactions in a timely manner. Where does it indicate bank is responsible for all unless it is a reoccurring transaction outside the 60 day period?

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#1298638 - 12/04/09 12:57 AM Re: Reg E Visa Debit Card Help Needed C_Groat
rlcarey Online
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I guess I have the same question:

Paragraph 6(b)(3)—Periodic Statement; Timely Notice Not Given

2. Transfers not involving access device. The first two tiers of liability do not apply to unauthorized transfers from a consumer's account made without an access device. If, however, the consumer fails to report such unauthorized transfers within 60 calendar days of the financial institution's transmittal of the periodic statement, the consumer may be liable for any transfers occurring after the close of the 60 days and before notice is given to the institution. For example, a consumer's account is electronically debited for $200 without the consumer's authorization and by means other than the consumer's access device. If the consumer notifies the institution within 60 days of the transmittal of the periodic statement that shows the unauthorized transfer, the consumer has no liability. However, if in addition to the $200, the consumer's account is debited for a $400 unauthorized transfer on the 61st day and the consumer fails to notify the institution of the first unauthorized transfer until the 62nd day, the consumer may be liable for the full $400.
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#1299415 - 12/04/09 09:39 PM Re: Reg E Visa Debit Card Help Needed rlcarey
John Burnett Offline
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C Groat,

I agree with you, but the bank's liability starts with the first unauthorized transaction, not with the start of the 60-day period. So in practice, the bank could be liable for up to about 90 days' of unauthorized activity.

If statements are end of month, and the first unauthorized transaction posts on March 1, the bank gets the privilege of covering all the unauthorized transfers from March 1 through May 30.
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