Are banks required to notify customers if a one-time EFT/loan payment they scheduled was not processed? I know they would be if it was initiated from a check, but wasn't sure if that covered payments you would schedule on line as well.

I do not understand what this means: manually scheduled payments by these customers were cancelled

Sorry, didn't communicate that very well.

The email was accidently sent Saturday evening. If a customer scheduled a payment online between the time the email went out and the auto-payments were processed on Monday, that payment was cancelled to avoid double debiting any customers.

Ah - well I would be sending those individuals a letter apologizing for the inconvenience and telling them what happened and informing them if they really intended to make the manual payment, they would need to reenter it.

That's my thought as well. I was just wondering if there was a particular cite under Reg E that I could point to requiring notice. Hypotherically, of course .

Would it just fall under the notice requirements for Preauthorized Transactions? Or would it be more of a potential UDAAP issue?

It comes down to you screwed up - Regulation E is not going to cover an operational mistake like this.

I'm with you 100%. Actually trying to support my case to upper management that if this occurred, we would need to reach out to every customer that had a payment cancelled in this situation and that deleting payments like this probably wouldn't be a great temporary solution.

I was hoping I missed something in the regulations or there was some supervisory guidance that required banks to notify a customer if a one-time payment (not initiated from a check) didn't occur as agreed. Basically, just looking for someone to do my job for me :P

Reg E covers transactions that occurred, not ones that you failed to process.

This is a client facing failure on the part of the bank that you did not process a transaction your client expected to be conducted, does upper management really need convincing that doing the right thing and making clients whole is only done if a regulation was broken? on top of this, your bank should also let the customer know you will reimburse them for any late fee or penalty that may have occurred due to the bank's failure to process their transaction.

you may want to look in your deposit agreement, bill pay agreement, or OLB agreement and see if there is language that details the bank and customer responsibility in this situation.

but in the end, you should be doing the right thing by your customer.

Suppose that I didn't see the email and wanted to make a prinicpal reduction which I set up over the weekend. You cancel my payment without telling me. I assume that I am going to owe less on my loan and also incur less interest expense because my principal is lower. This doesn't happen and I don't realize it for a number of years because you never told me.

Your process doesn't match what you disclosed to me when I received my manual payment confirmation. Forget what "regulation" covers this for upper management. This would scream "UDAAP" since I was harmed by all the extra interest I paid you.

Which is a good reminder that, when you make the transfers to make those payments, you should back-date them if possible if that will adjust any interest accruals. If that isn't possible or your system doesn't back adjust interest accruals you should adjust the accruals to what they would be if the payments had posted as intended.