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Procedure for POS Debit Card Disputes

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Question: 
Can the bank require a customer to contact the merchant directly regarding EFT disputes as part of the investigation process, specifically POS/debit card transactions?
Answer: 

If the cardholder's claim is also covered by Regulation E, the answer is, "No." Section 1005.11(b) states that all a customer need do to open a claim is provide the bank with their name, account number, and as much as they are able, the date and amount of the transactions, and why their believe an error exists. The institution may ask, but not require that the cardholder assist in the investigation. Also, the institution may not deny a claim solely on the basis of a cardholder refusing to contact a merchant, file a police report, etc.

However, if the dispute is not covered by Reg E (i.e. merchandise not received, merchandise damaged, customer not satisfied, etc.) then the institution may require that the cardholder comply with VISA/MasterCard requirements regarding merchant contact prior to filing a chargeback.

In instances where a customer is not cooperative and a chargeback cannot be filed without merchant contact, consider using a retrieval request which does not require merchant contact or a cardholder dispute letter. This will compel the merchant to provide information about the authorization to aid you in the investigation.

First published on BankersOnline.com 11/19/12

First published on 11/19/2012

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