Thread Options
#862233 - 11/28/07 09:08 PM Reg E - Preauthorized Transfers
C_Groat Offline
Joined: Mar 2006
Posts: 70
Salt Lake City, UT
Would America Online, Gold's Gym or other types of monthly membership services billed to a MasterCard/Visa debit card number be considered a Preauthorized Transfer under 205.10?

If these are considered pre-auth'd transactions, how are other banks compling with 205.10(c) to stop future transactions from hitting the individual account without having the transaction post, then chargeback after it already occurred?

Return to Top
eBanking / Technology
#862307 - 11/28/07 10:23 PM Re: Reg E - Preauthorized Transfers C_Groat
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 39,409
Cape Cod
Yes, assuming the card is attached to a consumer asset account subject to Regulation E protections.

I believe that MasterCard and Visa both have blocking services that address exactly the scenario you've described. There is undoubtedly a fee, but it is probably less expensive than the cost of the time involved in trying to recover funds through a chargeback.
John S. Burnett
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top

Moderator:  Andy_Z