Reg E for Non Fraud/Funds Transfer Disputes?

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Question:

Does REG E apply to disputes submitted for reasons other than fraud and funds transfer (such as service and or quality)?

Answer:

There are two sections of Regulation E that are involved in this question. The first, section 205.6, only deals with liability for unauthorized electronic fund transfers (UEFTs). The other, section 205.11, deals with errors involving EFTs, and the term "error" is defined in section 205.11(a). Nowhere in the list of seven types of errors are found the words "service" or "quality."

Unlike Regulation Z and the credit card rules which can require action in purely merchant disputes (quality, quantity of goods or services, for example), Regulation E does not address such issues.

For debit card transactions handled through the MasterCard or VISA networks (generally, signature-based merchant transactions), the rules of the card association address service and quality questions. You'll have to refer to the MasterCard or VISA operations manuals for further information on those requirements.

First published on BankersOnline.com 6/6/11