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Reg E Apply to Dispute w/ "Lost" Card?

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Question: 
We have a member that has given her ATM card and PIN to her son. Her son IS NOT on the account. He has "lost" the card, and now she is disputing the charges from other ATMs. Does Reg E apply even though he is not on the account?
Answer: 

Giving a thrid party access to an ATM card does not provide carte blanche for anyone to use the card. Reg E protections still apply to these transactions and the bank must still investigate. If you can obtain video showing that the son conducted the additional withdrawals then you can deny the claim based on the staff interpretation of the word "Authority."

205.2(m)(2)Authority. If a consumer furnishes an access device and grants authority to make transfers to a person (such as a family member or co-worker) who exceeds the authority given, the consumer is fully liable for the transfers unless the consumer has notified the financial institution that transfers by that person are no longer authorized.

First published on BankersOnline.com 10/3/11

First published on 10/03/2011

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