Answer:
by David Dickinson:
Here's an excerpt from our training manual on this topic:
Unauthorized Electronic Funds Transfer: [§1005.2(m)]
1. Includes:
…means an electronic fund transfer from a consumer’s account initiated by a person other than the consumer without actual authority to initiate the transfer and from which the consumer receives no benefit.
2. Not Included:
The term does not include an electronic fund transfer initiated:
a. Authorized Access:
By a person who was furnished the access device to the consumer’s account by the consumer, unless the consumer has notified the financial institution that transfers by that person are no longer authorized;
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You can see that an unauthorized EFT does NOT include situations where your customer gave someone their access device - no matter what that person did with it. However, there's a lot more to this. What if your customer got their card back and the other person later took it again, without permission? You need more details and information to just call it "denied".
Answer:
by John Burnett:
What if the cardholder gave the card and PIN to her sister with an OK to use it, but it was taken from her sister's purse by her daughter, the cardholder's niece? The exception to the definition of unauthorized EFT won't apply if the transaction is completed by the niece, because she didn't have the authorization.
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