Based on the verbiage of your original post, "...this type of dispute did not have rights..." they may have concluded that the sequence of events did not meet the definition of an unauthorized EFT under 1005.2(m).
"“Unauthorized electronic fund transfer” means an electronic fund transfer from a consumer's account initiated by a person other than the consumer without actual authority to initiate the transfer and from which the consumer receives no benefit."
If the bank concluded that the customer did, in fact, receive benefit from the transaction since they received the [facial cream, colon cleanser, muscle booster, appetite inhibitor, etc.] then they would have immediately informed the consumer that the transaction was not a covered EFT error subject to Reg E requirements. The bank may have then voluntarily elected to pursue the claim under VISA/MasterCard chargeback rules separate from the Reg E provisions.
All of this is blind speculation on my part. The only way you can confirm whether or not the Bank violated Reg E is to ask them and have them explain their process for resolving this claim.
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