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#2227646 - 12/18/19 03:32 PM Unauthorized EFT?
Bankwoman1 Offline
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Joined: Dec 2015
Posts: 548
Midwest
Customer provided their debit card to an online website for the purchase of some tools. She found this website on Facebook. She received no confirmation number or email from the company. She was charged $139.90, but when she calls the number that shows up on the charge, it is an accounting firm out of Texas. The accounting firm has stated that they have been receiving these types of calls since last week, but they have nothing to do with selling tools online. Customer is now claiming an unauthorized EFT. Would this fall under the definition of an unauthorized EFT?

1005.2 (m) 3.Access device obtained through robbery or fraud. An unauthorized EFT includes a transfer initiated by a person who obtained the access device from the consumer through fraud or robbery.

Would this situation fall under "fraud"?

We keep going back and forth as to whether this is an unauthorized EFT since the customer did provide their card information. However, it is obviously a fraudulent website.

Thanks!

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eBanking / Technology
#2227655 - 12/18/19 04:07 PM Re: Unauthorized EFT? [Re: Bankwoman1]
BrianC Offline
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Illinois
Did the customer authorize the 139.90? If so, then there is no Reg E protections. However, based on your description of the sequence of events, you do have chargeback rights for the customer to claim non-receipt of merchandise. Your contract with V/MC will still require that you offer assistance.
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#2227657 - 12/18/19 04:15 PM Re: Unauthorized EFT? [Re: Bankwoman1]
FlyGuy Offline
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Hi Brian, Bankerwoman1 and I work side by side on this and that's the feeling we felt since she provided the information and authorized the original purchase of $139.90. We planned on the chargeback route, but questioned the definition of 1005.2.

Thanks for clarifying with us!

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#2227673 - 12/18/19 05:49 PM Re: Unauthorized EFT? [Re: Bankwoman1]
BrianC Offline
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My pleasure. 1005.2 would cover occurances such as phishing / vishing attempts where the customer is tricked into providing their access device, never actually authorized a charge and the bad guys used the information provided to originate charges the customer did not authorize.
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#2227681 - 12/18/19 06:32 PM Re: Unauthorized EFT? [Re: Bankwoman1]
Andy_Z Offline
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This is also an area where a credit card instead of a debit card would have offered more protections. Reg E isn't concerned with the satisfaction of a product or service whereas a credit card would. As Brian noted, Reg E cares if the consumer ordered the bank to make the payment/transfer, not if they were happy with the purchase.
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#2227687 - 12/18/19 06:49 PM Re: Unauthorized EFT? [Re: Bankwoman1]
Bankwoman1 Offline
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Joined: Dec 2015
Posts: 548
Midwest
Ok....so I just want to make sure I have this straight in my head. Because our customer provided their debit card number to this website and authorized the amount for the purchase, then it would not be considered an unauthorized EFT. Couldn't it be said, in a sense, that the customer was "tricked" into providing their access device? They were tricked into believing they were actually purchasing a product when in fact this was a fraudulent website all along.

I'm not trying to be difficult, and believe me, I'm not really arguing about being able to deny a claim (although I do want to be able to help our customer), I'm just trying to differentiate between being tricked into providing their access device and falling victim to a fraudulent website and providing their access device.

Does that make sense?

And thank you both for your previous responses! They are appreciated!
Last edited by Bankwoman1; 12/18/19 06:52 PM.
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#2227693 - 12/18/19 07:13 PM Re: Unauthorized EFT? [Re: Bankwoman1]
Valley girl Offline
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Posts: 172
TX
I feel for you on this situation. I get many of these also. I feel the customer is in the best position to verify the authenticity of the website. If they have doubts, they can also reach out to the merchant before they make the purchase. I base my theory on the fact that the consumer initiated the transaction.

I always try the dispute route of "merchandise not received" to help our members recover the loss. Consumers do need to remember that not everything you read (or see) on the internet is real.

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#2227696 - 12/18/19 07:17 PM Re: Unauthorized EFT? [Re: Bankwoman1]
burkemi Offline
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Posts: 371
The biggest difference is that your customer found the website on FB, voluntarily followed the link, and voluntarily entered the card info. Therefore, your customer was fully aware and did, in fact, authorize the purchase of the tools.

Now, had that authorization been used to purchase iTunes gift cards, McDonald's, and a weekend spa in Switzerland - then she is tricked into entering the card information for unauthorized purchases. She authorized the payment for tools (or charity seems to be the most likely culprit around here), not the purchases described above.

1 step further - if the $139.90 purchase for the "tools" is present along with the gift cards, McDonald's, and spa - those 3 are unauthorized, the $139.90 is STILL an authorized purchase.
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#2227699 - 12/18/19 07:24 PM Re: Unauthorized EFT? [Re: Bankwoman1]
Bankwoman1 Offline
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Joined: Dec 2015
Posts: 548
Midwest
That does make sense. Everyone needs to be vigilant when purchasing items off of unknown websites. I feel like in this day and age, everyone should be well aware of this. Burkemi - you actually answered another question that was in my head regarding additional transactions that might have shown up along with the tools. Thanks for that! Both you and Valley girl have helped me figure this out in my head and get a better picture of things!

Thanks so much!

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