Helping Customer Resolve Stolen ATM Card Issue

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Question:

We have a customer who had his wallet stolen. He had our check card, a card from “Our Bank” and one from “His Credit Union” in his wallet. “His Credit Union” card was used at an ATM and money was taken from his checking and savings account. “His Credit Union” told him that they think it was his negligence that the card was used, so they will not give him his money back. How can we determine if it was his negligence? And he wants to put in a complaint with someone or talk to someone about this and what his liability is. Please advise me as to what agency/regulator he can contact to resolve this situation.

Answer:

The regulatory agency which oversees the financial institution (the NCUA in this case) would be the point of contact to complain to. Contact information is available on their website.

As to determining negligence, even if you are not an OCC regulated bank, look at OCC Bulletin 2001-9, for great ideas on improving your investigation procedures. Negligence in itself is often not sufficient to justify a denial of a claim. This is partially addressed in the OSC, OSC(6)(b)2 Consumer negligence. Negligence by the consumer cannot be used as the basis for imposing greater liability than is permissible under Regulation E. Thus, consumer behavior that may constitute negligence under state law, such as writing the PIN on a debit card or on a piece of paper kept with the card, does not affect the consumer's liability for unauthorized transfers.

There is no "one size fits all" circumstance for claims as many variables will exist and if the claim is a minimal amount, the bank may pay it by default rather than investigate it. Or the bank may determine that the $30 claim would be absorbed by the initial liability, as an example. Some investigation is still required, but may be minimal.

First published on BankersOnline.com 4/24/06