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Reg E Refuse Provision Credit if Multiple Disputes

Question: 
Under Reg E or MasterCard if a customer has multiple disputes a year, are we required to give provisional credit or can we refuse provisional credit if there is suspicion?
Answer: 

Answer by Brian Crow: MasterCard waives its Zero Liability provision if a cardholder has made more than two claims in a twelve month period. However, there is no such exception in Reg E. Provisional credit is required on the 10th business day for all Reg E claims (assuming you have received written confirmation if required.) In situtations when Zero Liability does not apply, you may withold $50 as permitted by Reg E 1005.11(c)(2)(i).

Answer: 

Answer by John Burnett: Many banks would prefer to cancel the card (and possibly the account) of a customer making multiple error claims. (That doesn't however, alter the current claim.)

First published on BankersOnline.com 3/18/13.

First published on 03/18/2013

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