Federal regulations offer protection for banks and account holders. If you have a savings or checking account, you may have heard of the term “Regulation E.”

What is Regulation E?

Regulation E was set by the Consumer Financial Protection Bureau (CFPB) in accordance with the Electronic Fund Transfer (EFT) Act. It’s a federal regulation protecting consumers from incorrect and fraudulent electronic fund transfers from or to their bank accounts. A victim can follow the EFT process to dispute erroneous or unauthorized transactions, such as unapproved ATM withdrawals. It also limits consumer liability in the case of a stolen or lost debit card.

Transactions Regulation E Covers

●Automated teller machine (ATM) transfers

●Point-of-sale (POS) transfers

●Transfers done via telephone

●Direct withdrawals or deposits of funds

●Debit card transactions

●Gift cards

●Person-to-person (P2P) payments. For example, Zelle

The Consumer Financial Protection Bureau (CFPB) excludes a few electronic transfers, such as wire transfers and checks. Regulation D applies to electronic funds transfers, including savings, checking, and money market accounts. However, it does not apply to business accounts and credit cards. For the latter, check the Fair Credit Billing Act for any rights when disputing unauthorized charges

Filling a Regulation E Dispute

Your debit card has a phone number on its back, which you can file to make a complaint. Sometimes, the dispute is easily resolved, and you can access your account. Other times, the account is locked, and the bank might ask for the following is written:

●The amount stolen from your account

●The date of the transaction

●What the amount was spent on

●The transaction date posted in the bank statement

●Whether your card was stolen or lost

Institution Requirements

According to the EFT Act, banks are legally required to tell their customers about any liability on unauthorized transactions and transfers. They must outline the procedure a customer should follow to report errors. The transfer types and associated fees must be mentioned in the agreement, as well as any limitations. For example, if a bank allows only a specific amount and number of transactions in a month, they should inform you about it before you sign on the dotted line.

Banks are allotted 10 business days for the investigation and should resolve the case within a single business day. If the claim is complicated, the bank has 45 days to come to a conclusion. In the meantime, they must provide the customer with provisional credit. Remember: The faster you report the theft, the lower your liability. So, DO NOT take more than12 hours to inform your bank about the theft.