We had client claim fraud using their debit card. They filed a police report (in neighboring city where they reside) and we couldn't prove they were not telling the truth and provided final credit under Reg E.

Long story short, in following up with the police in the city that the transactions occurred they spoke with the client who confessed they made the transactions. The transactions and dispute occurred in February and we just learned of the confession last Tuesday (June).

Can we demand the client to return the money? We don't have a letter or report from the police, just their word.

Final means final so you have no recourse under Reg E. Any pursuit of the customer would be through their admission of guilt and them voluntarily returning the funds or filing a civil lawsuit against them claiming their defrauded the bank. The first scenario is not likely to happen and the second scenario likely will cost more than what you believe they owe you.

Probably best to make this an ex customer and move on.