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#2192988 - 09/18/18 07:55 PM Mailing Notices - Reg E
Susielou Offline
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Joined: Aug 2005
Posts: 342
Midwest
Is there anything in Reg E that says a notice needs to be mailed each time a recurring transaction takes place. Customer has set up a recurring transaction for every Friday and a notice prints out to mail on Monday. Reg E does not require this does it?

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#2192990 - 09/18/18 08:00 PM Re: Mailing Notices - Reg E Susielou
BrianC Online
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BrianC
Joined: Nov 2004
Posts: 6,275
Illinois
Providing a notice to consumers is one permissible method of providing notice of preauthorized transactions. Providing a customer service number for them to call is another. You are free to choose which method makes the most sense from a customer service and a cost perspective.

See Reg E 1005.10(a)

(a) Preauthorized transfers to consumer's account. (1) Notice by financial institution. When a person initiates preauthorized electronic fund transfers to a consumer's account at least once every 60 days, the account-holding financial institution shall provide notice to the consumer by:
(i) Positive notice. Providing oral or written notice of the transfer within two business days after the transfer occurs; or
(ii) Negative notice. Providing oral or written notice, within two business days after the date on which the transfer was scheduled to occur, that the transfer did not occur; or
(iii) Readily-available telephone line. Providing a readily available telephone line that the consumer may call to determine whether the transfer occurred and disclosing the telephone number on the initial disclosure of account terms and on each periodic statement.
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#2198873 - 11/21/18 04:39 PM Re: Mailing Notices - Reg E Susielou
Jan94 Offline
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Joined: Mar 2001
Posts: 828
USA
HR wants to send letter to retired team members about a change to their insurance payment going from every 12 months to now once a month. Just wanting to confirm whether this would this be a Reg E change in terms requiring the 21 day advance notice - looking at (iv) below? Thank you!

Sec. 1005.8 Change in terms notice; error resolution notice.
(a) Change in terms notice. (1) Prior notice required. A financial institution shall mail or deliver a written notice to the consumer, at least 21 days before the effective date, of any change in a term or condition required to be disclosed under ยง 1005.7(b) of this part if the change would result in:

(i) Increased fees for the consumer;

(ii) Increased liability for the consumer;

(iii) Fewer types of available electronic fund transfers; or

(iv) Stricter limitations on the frequency or dollar amount of transfers.

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#2198893 - 11/21/18 06:21 PM Re: Mailing Notices - Reg E Susielou
Andy_Z Offline
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Andy_Z
Joined: Oct 2000
Posts: 27,485
On the Net
The issue here is the more frequent debit and not a limitation set under Reg E. I would believe the plan itself that is changing would have a responsibility to notify the consumer that payments are changing from annual to monthly.

If the plan or entity authorized to make the debit fails to do so, the consumer may then claim it as an unauthorized withdrawal. If it is the bank itself making the withdrawal, it should tell them, not as the bank and under Reg E, but as the ex-employer providing the health benefit plan.
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#2198899 - 11/21/18 06:28 PM Re: Mailing Notices - Reg E Susielou
Jan94 Offline
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Joined: Mar 2001
Posts: 828
USA
Thank you. As I was re-reading, I realized I was thinking about a change in the Reg E agreement around limits versus a change in this preauthorized transfer. I agree a notice should be provided, was just trying to determine if there is any time frame required 10 days, 30 days, etc.

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