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#2070174 - 03/21/16 03:07 PM Card used after cardholder's murder
Daisy Doodle Offline
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Southern U.S.
A former boss of mine who is now working as a CPA called me over the weekend with this question which I could not answer for her. She is trying to help a client of hers.

Her customer is a Dad who's son was murdered. The culprit was apprehended and is in jail. During the event he stole the vehicle and wallet of his victim. He used the debit card daily and managed to drain the account of $15,000 before he was caught. The money was not recovered.

The bank denied his dispute because a PIN was used. There is no known connection between the criminal and the victim, so perhaps he had the PIN in his wallet or something similar. Question. Does this Dad have any recourse at all now?

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#2070178 - 03/21/16 03:29 PM Re: Card used after cardholder's murder Daisy Doodle
CULady Offline
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Posts: 496
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I've been out of the Reg E world for awhile now, but I don't think use of a PIN is a justifiable reason for denying a claim. It was still unauthorized, so the bank needs to make the customer whole and go after the person that benefitted from the charges.

Hopefully someone else can chime in with better information...

-K

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#2070180 - 03/21/16 03:32 PM Re: Card used after cardholder's murder Daisy Doodle
Daisy Doodle Offline
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He was also outside of the 60 day notification. I notice 'extenuating circumstances' is not defined very well in the Reg.

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#2070199 - 03/21/16 04:37 PM Re: Card used after cardholder's murder Daisy Doodle
CULady Offline
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Well depending on the timeframe when the purchases were made, the customer should still be refunded the first 60 days worth of charges, but could be held liable for the 1st $500 if the bank wasn't notified within two days of discovery.
But really, I think being dead would be an extenuating circumstance. It would take time for the family to get the estate figured out. The bank might have just made a knee jerk reaction hoping it would go away as $15,000 is a big loss to write off.

-K

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#2070200 - 03/21/16 04:41 PM Re: Card used after cardholder's murder Daisy Doodle
Daisy Doodle Offline
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Southern U.S.
That's what I thought---the bank was taking a really hard line with the Dad.

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#2070261 - 03/21/16 06:54 PM Re: Card used after cardholder's murder Daisy Doodle
CULady Offline
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Joined: Sep 2007
Posts: 496
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Well if they told him no because the PIN was used, I think he can try to re-submit the claim. If he has a lawyer at all, I would suggest maybe having a lawyer draft a letter. It might be worth it due to the amount.

I have to say, I am really surprised you are not getting more responses on this. I keep replying with what little knowledge I have mostly to keep it bumped up for you! laugh

-K

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#2070263 - 03/21/16 06:58 PM Re: Card used after cardholder's murder Daisy Doodle
Daisy Doodle Offline
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#2070265 - 03/21/16 07:00 PM Re: Card used after cardholder's murder Daisy Doodle
Skittles Offline
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TN
I'd have dad send a letter or complain to the CFPB on-line and/or their regulatory agency. Obviously the son didn't do the transactions and a bank cannot deny because a PIN was used - and there is no time limit on filing a dispute.
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#2070267 - 03/21/16 07:05 PM Re: Card used after cardholder's murder Daisy Doodle
Renea Rush Offline
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Whole heartedly agree with Skittles

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#2070327 - 03/22/16 09:15 AM Re: Card used after cardholder's murder Daisy Doodle
Elwood P. Dowd Offline
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You do not want Dad relying on you for advice on the workings of Reg E that he might have obtained from a lawyer... Skittles' advice, writing to CFPB and perhaps copying the bank's prudential regulator, is actually the course that might help Dad the most as this is a situation where most people could conjure up some sympathy.

You framed the context very well. Your contribution (at most) could be helping the CPA draft the letter.
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#2070782 - 03/24/16 05:20 PM Re: Card used after cardholder's murder Daisy Doodle
OldeTymeBanker Offline
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Joined: Mar 2016
Posts: 55
Obviously I don't know the circumstances of the murder, but if someone was threatening my life while asking for my PIN, I would most certainly give it to them. Like others I don't see where the basis of the PIN being used is grounds for denial.
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#2070793 - 03/24/16 05:32 PM Re: Card used after cardholder's murder Daisy Doodle
rlcarey Online
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rlcarey
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Galveston, TX
Their customer was dead - how in the world could the transactions be authorized??

Geez, I would cut through the bull and just sue the second part of that word out of the bank that is so stupid.
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