The bank thought that this would be covered under Reg E and we have not found anything that addresses how long the bank can have these type "holds". We're thinking that the bank may be really asking about a possible Reg E dispute that could arise if the customer thought a item had processed and then had another item post during this hold period, so we're going back to verify that.
Regulation E doesn't even recognize that debit card holds exist. So you won't find any help there. The holds you describe are also not Regulation CC holds. The hassles that some banks have had in this area are centered on holds that are placed that greatly exceed an actual transaction (some merchants send an authorization request based totally on guesswork, like the gas station that sends a $75 fold for debit at the pump -- come to think about it, that may not be so outlandish these days!). Also bothersome are use of debit cards for car rentals (some agencies refuse debit for the front end but accept it when the dollar amount is finalized), and hotel rooms (some hotels do the same thing as car rental agencies).