ATM - Disputing an Unauthorized Use Claim

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Question:

In our terms and conditions, we state that we can deny a dispute if "we conclude that the facts do not reasonably support a claim of unauthorized use." If a cardholder claims an ATM withdrawal is unauthorized, but has another ATM withdrawal on the same card after the transaction in question we generally deny the claim. Is the cardholder only liable for $50 per Reg E if the dispute was filed within the 60 day time frame?

Answer:

I don't believe you can legally deny all claims like the one you describe. Reg E rights cannot be taken away just because you have such a statement in your terms and conditions. It is common for someone to gain my ATM information and make a card just like mine, even though I still possess my card (skimming). They could make a withdrawal and later I make one. It is still unauthorized, but it meets your denial conditions. Your institution's personnel have much to learn about card thefts. I encourage you to go to youtube.com and search for ATM skimming. You will be amazed by the way crooks can gain access to your customers accounts without them (or you) ever knowing.

First published on BankersOnline.com 1/26/09