Hi All -

We have recently had a handful of cases where a member gets a new card, makes a deposit, and a short time period (within 3 days) have gift card purchases in store where the chip was validated during the transaction. Within a few days we get the call from the member that the card must have been lost or stolen and they are claiming unauthorized.

We have at least a handful that fit the bill of exactly the same scenario in the same time period. My question is - What does Reg E say I have to provide when denying this claim? Want to make sure our i is dotted.

How can you deny the claim?? You have photo evidence that it was them?

Good question and I believe you have hit the nail on the head with our question around this. In these cases they are brand new cards with ATM deposits where we have validated it is the member. Just following (enough time to get to the store in these cases) the card with chip is used for the exact amount of the deposit.

We have not contacted the merchant yet to get photos and in one of these cases we had inconsistent answers around if it was them that used the ATM and we have their picture to validate it is the member there.

So we have a case where six people supposedly lost their cards just after their first atm deposit and then happened to hit the same store chain (within 20 minutes of each other). So beyond a shadow of a doubt, no. But I would say the hair on my arm is tingling.

Yup - sounds like a fraud ring. Have you talked to the police yet?

Unfortunately, when it comes to Reg E, you can't use "judgmental" logic. You must assume they are innocent until you prove they are guilty.

rlcarey - Not as of yet but they are on our list for tomorrow.

Thanks Dave as well. Unfortunately that is what I kept running into for our conversations internally too. We will continue our investigation on this one for sure!