Thread Options
#1855804 - 09/26/13 03:33 PM Reg E and VISA
Patricia Offline
Gold Star
Joined: Mar 2011
Posts: 327
Kansas
I am getting push back from management on the Error Resolution rule regarding the $50.00 and VISA's zero liability. The bank has been with withholding the $50.00 from disputes, that are truly unauthorized, so because of VISA' zero liabiltiy rule I am saying we need to reimburse these customers. Management is saying why didn't the examiners find this exception? I don't know the answer to this question. My come back is that we are in violation of VISA' operating rules.

Return to Top
eBanking / Technology
#1855813 - 09/26/13 03:41 PM Re: Reg E and VISA Patricia
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 39,557
Cape Cod
The examiners could have cited you for non-compliance with a requirement that is more protective of the consumer, but for whatever reason did not do so. It's still a violation of the Visa contract unless an exception applies. If Visa were to pursue the bank with a penalty for a rules violation, management might not be pleased.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1855821 - 09/26/13 03:48 PM Re: Reg E and VISA Patricia
Patricia Offline
Gold Star
Joined: Mar 2011
Posts: 327
Kansas
Thanks John.

Return to Top
#1856236 - 09/27/13 04:43 AM Re: Reg E and VISA Patricia
BrianC Offline
Power Poster
BrianC
Joined: Nov 2004
Posts: 6,207
Illinois
I would echo that if assuming your card disclosures include VISA liability language in them, although the examiners missed it this time, they could cite you with UDAAP if they find that you are disclosing one policy (Zero Liability) but in realty following a different policy.

An Indiana Bank that was hit with an $85,000 CMP for requiring police reports on Reg E claims tried using the defense "but no one said anything about it on previous exams" as an excuse.

http://www.journalgazette.net/article/20111029/BIZ/310299939

"Mike Marhenke, president and CEO of Independent Alliance Banks Inc., said the issue revolved around whether bankers could require customers to file a police report before giving temporary credit for unauthorized withdrawals from their accounts.

Staff at both banks under his watch required police reports because they simply missed that provision in the detailed regulations banks are required to follow, Marhenke said. Independent Alliance Banks is a two-bank holding company that owns Grabill Bank and MarkleBank.

“The last compliance exam, we were doing the same thing, and (inspectors) didn’t say a thing,” Marhenke said."
Last edited by John Burnett; 09/30/13 04:34 PM. Reason: changed policy to police
_________________________
Sola Gratia, Sola Fides, Sola Scriptura, Solus Christus, Soli Deo Gloria!
www.tcaregs.com

Return to Top

Moderator:  Andy_Z