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Reg E Dispute Charge Back After 90 Day Time Frame

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Question: 
We have a customer who disputed a POS charge and the 90-day time frame has been completed with the completion letter already sent. The merchant has provided documents showing that the customer called to unenroll on a different date listed on their dispute letter. They did tell them it takes one business cycle for changes to be made, but hung up. Do we have any rights per Reg E as an institution to charge back the disputed charge to the customer so they will need to resolve it with that merchant directly if the dispute time frame is completed? Or do we take the loss since it is after the completion date when the charge is re-presented back to us?
Answer: 

Reg E provides you with specific time frames by which you must complete your investigation. If you finalize your investigation early, or if you go to the last day, when you say it is final, it is final.

The merchant may have more time than you do to finalize a transaction. That's just the way it is. They may be following more liberal Visa, MasterCard or ACH rules. That is addressed in your agreement with them under the Visa, MasterCard or ACH rules. It isn't an agreement you have with your consumer. As bankers, we have to follow the EFTA law and Reg E as that is our agreement with our consumers.

First published on BankersOnline.com 2/25/13.

First published on 02/25/2013

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