Introduction: Electronic Fund Transfer Act and Regulation E

This section will explain your Regulation E responsibilities after an account that is subject to Regulation E has been opened. First, we will list the general sorts of transactions and accounts to which Regulation E applies, and then we will define some of the terms and phrases we will be using. Some of this general information is repeated from the Regulation E section in Part I of this manual, but we do define some additional terms that you need to be familiar with here because of the broader scope of this section. Second, we will look at rules that allow you to provide Regulation E information to the consumer by electronic communication—if the consumer agrees. Third, we will look at the documentation requirements of Regulation E: requirements that you supply receipts at electronic terminals, periodic statements, and various other types of notices. Fourth, we will examine the rules governing your actions and the consumer’s actions when the consumer believes an error has occurred with respect to an electronic funds transfer (EFT). The limitations on the consumer’s liability for unauthorized transfers will be the fifth topic. Sixth, we will go over the details of the stop-payment procedures—what you and the consumer must do when the consumer wants to stop a preauthorized withdrawal. Seventh, we will look at the restrictions Regulation E places on institutions that want to issue new “access devices.” And finally, we will look at the conditions an institution must meet before it can charge a fee for paying an overdraft caused by an ATM or one-time debit-card transaction.

A number of states have laws or regulations that affect electronic funds transfers. We wrap up this section by summarizing those state laws.

The Regulation E section in Part I of this manual dealt with initial disclosure requirements. Many times, institutions give the initial disclosure at account opening and that is why we put that information in the account opening part of the manual. However, there are circumstances where the disclosure either must or can be given later on. Although the initial disclosure requirements do have some applicability after account opening, we go over all the details of the timing, format, and contents of the initial disclosure in the earlier section just for simplicity’s sake.