On March 26th, we conducted our “Regulation E: EFT & Disputes” webinar with two hours of great information! These requirements can make your head spin and a lot of that can be attributed to the fact that Regulation E by and large has not kept up with technology like Venmo and other third-party payment providers. Scams and fraud also seem to be increasing more and more every day. On top of that, you likely also have Visa and MasterCard rules to follow that don’t always line up perfectly with Regulation E requirements. Needless to say, that can lead to a lot of questions. We answered over 60 questions for attendees, in writing, and not only are they a great source of information but help shed light on the real-world examples institutions face.
Here are a few:
Question: If provisional credit was not given because the customer initiated the purchase, but the claim comes back that the merchant is not going to reverse the transaction (or we lost the dispute), is the bank liable to give that credit to the customer?
Answer: No. If the customer initiated the transaction, it’s not unauthorized and wouldn’t be subject to Regulation E.
Question: If we have a customer that continually has card disputes due to fraud, with cards closed and new ordered, can the bank refuse to give a new card?
Answer: Absolutely. Having a card is a privilege and not a right.
Question: If we deny a dispute based off of our initial investigation which justifies our denial and our customer comes back later wanting to re-dispute, but they have no new information to provide, do we need to reopen the dispute because they are maintaining fraud? Is there a time limit through which they need to reconnect with us to maintain fraud after a denial?
Answer: No. If you have fully complied with what Regulation E requires, you have no further responsibility if a consumer wants to reassert the same error later on. Regulation E does not define “fraud” or require that if the consumer claims fraud that it be treated any differently than you do an “unauthorized electronic fund transfer”. It’s possible that Visa/MasterCard have different requirements related to fraud and you will need to look at your contract.
Published
2025/06/19
