Relative Given Debit Card by Customer

Question:

I have a customer that has given a debit card with PIN to a relative with apparently no restrictions as to it's use. The relative has lost/had stolen the card and PIN and as a result there are now unauthorized transactions beings questioned. In the customer responsible or is the bank since the card was not stolen or lost by the customer?

Answer:

Any transactions conducted by the relative (who was given permission to use the card) are authorized. Transactions by anyone else are unauthorized and the bank needs to follow Reg E error resolution procedures on them.

First published on BankersOnline.com 10/15/07