Dispute Filing - Statute of Limitations

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Question:

Are there any statue of limitations on a consumer filing a dispute in Reg E? The consumer comes in a year after the transactions (the first to the last transaction all occur within a 60 day period so unlimited liability would not apply) and wants to dispute the items as unauthorized. Does the institution have any defense or must they accept the loss?

Answer:

There is no deadline in which a claim of an unauthorized EFT must be filed with you. The 60-day period described in section 205.6 of the regulation serves only as a limit on the bank's liability to the customer for transactions that the customer could have prevented by timely reporting. If my bank paid a single ACH debit on my account in 2003 and I dispute it in 2009 as being unauthorized, my bank must investigate to determine whether I did authorize the transaction. If I did, the bank can deny the claim. If I didn't, the bank has to reimburse me for it. Whether or not the bank is able to return the ACH item is irrelevant.

First published on BankersOnline.com 3/16/09