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#2220533 - 08/27/19 08:32 PM Question on Letter to Customer - Reg. E Dispute
Anonymous
Unregistered

Bank includes the following statement in certain Reg. E provisional credit letters to customers:

"We need additional information in order to complete the process of your claim. Please complete the enclosed documents and return with the envelope provided. A return of the information requested by (date) will enable us to finalize the processing of you dispute claim and expedite the closing of the dispute. Failure to provide this information could result in the denial of your claim and the deduction of the provisional credit given."

I believe this statement could be a problem for the bank. It alludes to the bank not processing (investigating) the dispute unless customer completes and returns paperwork.

Thoughts?

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#2220539 - 08/27/19 09:43 PM Re: Question on Letter to Customer - Reg. E Dispute Anonymous
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
I don't think the statement "could be a problem" is accurate. I would substitute the word "is" for the words "could be". Telling them that it might expedite the investigation would not be a problem IMHO.
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#2220544 - 08/27/19 10:06 PM Re: Question on Letter to Customer - Reg. E Dispute Anonymous
Anonymous
Unregistered

Department that handles Reg. E disputes will argue that without the "signed" paperwork - the disputed transaction cannot be investigated by the third-party (Core Processor) that assists with VISA debit card disputes.

In lieu of signed paperwork - what investigation methods can be completed to validate denial of the disputed transaction?

I believe the Department Manager is trying to limit charge-offs.....

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#2220545 - 08/27/19 10:31 PM Re: Question on Letter to Customer - Reg. E Dispute Anonymous
burke116 Offline
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Joined: Jun 2014
Posts: 562
Petersburg, VA
Quote
Department that handles Reg. E disputes will argue that without the "signed" paperwork - the disputed transaction cannot be investigated by the third-party (Core Processor) that assists with VISA debit card disputes.


The ultimate responsibility of investigating the claim falls on the bank. The fact that you use a vendor and your vendor will not begin their investigation without something that the regulation specifically says you cannot require before beginning an investigation is not an excuse for denying a claim.

Quote
In lieu of signed paperwork - what investigation methods can be completed to validate denial of the disputed transaction?

Investigations don't validate denials. Investigations should determine whether an error occured or not.

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#2220548 - 08/27/19 11:52 PM Re: Question on Letter to Customer - Reg. E Dispute Anonymous
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
"I believe the Department Manager is trying to limit charge-offs....."

You might want to show them this $15.5 Million CFPB consent order with USAA that includes:

24. Through May 2015, as a matter of policy USAA did not investigate reported errors unless the consumer asserting the error submitted a completed WSUD within 10 days of USAA sending the consumer the form.

https://files.consumerfinance.gov/f/documents/bcfp_usaa-federal-savings-bank_consent-order.pdf
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#2220550 - 08/28/19 11:48 AM Re: Question on Letter to Customer - Reg. E Dispute Anonymous
Adam Witmer Offline
Power Poster
Joined: Sep 2010
Posts: 2,658
Originally Posted by Anonymous
"Failure to provide this information could result in the denial of your claim and the deduction of the provisional credit given."

I believe this statement could be a problem for the bank.

I agree that this is problematic as you can't discourage customers from filing error resolution requests. If an examiner were to run this statement against the 3 prong UDAAP tests for unfair and deceptive, I wouldn't want to be the one trying to argue that it didn't fail the test. As Randy pointed out with the USAA consent order, discouraging the filing of error resolution requests has been a hot topic and has been repeatedly discussed by the regulators in recent years. For example, one of the most recent discussions came just this summer with the FDIC's Summer 2019 Consumer Compliance Supervisory Highlights found here: https://www.fdic.gov/regulations/examinations/consumercomplsupervisoryhighlights.pdf

As burke said, the fact that your third party processor won't investigate a claim without signed paperwork has no bearing whatsoever on your requirements under Reg E. Reg E says you have to investigate a claim promptly, even upon an oral request. If your third party won't conduct an investigation without signed paperwork, you still have to comply with Reg E. If you can't conduct an internal investigation (because you aren't set up for it), the result may be that you have no choice other than refunding the customer without conducting the (third party) investigation.

Also, as Brian C has pointed out on other threads, depending on your third party processor requirements, you may be able to take advantage of VISA/MC Certification forms since this option does not require a customer signature. (See Brian's post #2220341 here: https://www.bankersonline.com/forum...etting-customer-to-sign-form#Post2220341)
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All statements are my opinion, not those of my employer, and should not be taken as legal advice.
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#2220552 - 08/28/19 12:58 PM Re: Question on Letter to Customer - Reg. E Dispute Anonymous
Anonymous
Unregistered

If anyone can point me in the direction of where to find the VISA Certification Form that does not require a customer signature - it would be appreciated.

Thank you for all of you responses.

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#2220616 - 08/28/19 07:13 PM Re: Question on Letter to Customer - Reg. E Dispute Anonymous
BrianC Online
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BrianC
Joined: Nov 2004
Posts: 6,694
Illinois
VISA does not have a form. It allows the issuer to enter an “Issuer Certification” into VISAnet when the chargeback is filed which you processor should be willing to do on your behalf.
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