reg e change in terms notice requirements

1693 et seq. 2. An institution may obtain a consumer's affirmative consent by providing a blank signature line or check box that the consumer could sign or select to affirmatively consent, provided that the signature line or check box is used solely for purposes of evidencing the consumer's choice whether or not to opt into the overdraft service and not for other purposes. The statement shall set forth the following information, as applicable: (1) Transaction information. 2. The consumer's liability for unauthorized transfers before the statement is sent, and up to 60 days following, is determined based on the first two tiers of liability: up to $50 if the consumer notifies the financial institution within two business days of learning of the loss or theft of the card and up to $500 if the consumer notifies the institution after two business days of learning of the loss or theft. The requirements in paragraph (a)(4)(iii) apply to any card, code, or other device provided to a consumer in connection with a loyalty, award, or promotional program if the period of eligibility for such program began on or after August 22, 2010. Issued for loyalty, award, or promotional purposes. When used as a debit card, the card draws on the consumer's checking account. If an overdraft results, the service provider shall promptly reimburse the account-holding institution in the amount of the overdraft. 12(b) Preemption of Inconsistent State Laws. Electronic fund transfer service provider not holding consumer's account. 1. When a financial institution fails to provide the consumer with a periodic statement, a request for a copy is governed by this section if the consumer gives notice within 60 days from the date on which the statement should have been transmitted. Issued primarily for personal, family, or household purposes. 1. Outstanding Negative Balance. 2. (d) Business day means any day on which the offices of the consumer's financial institution are open to the public for carrying on substantially all business functions. (2) Store gift card means a card, code, or other device that is: (i) Issued on a prepaid basis primarily for personal, family, or household purposes to a consumer in a specified amount, whether or not that amount may be increased or reloaded, in exchange for payment; and. Except in unusual circumstances, such interpretations will not be issued separately but will be incorporated in an official commentary to this part, which will be amended periodically. The term marketed or labeled as a gift card or gift certificate means directly or indirectly offering, advertising or otherwise suggesting the potential use of a card, code or other device, as a gift for another person. The requirement that funds underlying a certificate or card must not expire for at least five years from the date of issuance or date of last load ceases to apply once the certificate or card has been fully redeemed, even if the underlying funds are not used to contemporaneously purchase a specific good or service. A merchant issues a paper certificate or receipt bearing a bar code or certificate number that can later be scanned or entered into the merchant's system and redeemed by the certificate or receipt holder towards the purchase of goods or services. Federal Reserve Bank serving the District in which the institution is located. Another dormancy, inactivity, or service fee could not be imposed until January 31 of year three, assuming there has been no activity on the certificate or card since January 31 of year two. (2) Telephone number for fee information. A written statement available to the public or to account holders that describes a service allowing a consumer to initiate transfers by telephone constitutes a planfor example, a brochure, or material included with periodic statements. Point-of-sale transactions. (2) Conditioning payment of other overdrafts on consumer's affirmative consent. A financial institution may permit, but may not require, consumers to pick up their periodic statements at the financial institution. Request for documentation. The term electronic fund transfer includes: i. If you bring your passbook to us, we will record any electronic deposits that were made to your account since the last time you brought in your passbook. Opt-in methods. However, the posting of a company policy that funds may be disbursed by prepaid card (such as a sign posted at a cash register or customer service center stating that store credit will be issued by prepaid card) does not constitute the marketing of a card, code, or other device to the general public. When a consumer obtains cash from a POS terminal in addition to purchasing goods, or obtains cash only, the documentation need not differentiate the transaction from one involving the purchase of goods. There is no prescribed terminology for identifying a transfer at a merchant's POS terminal. The type of ATM or debit card provided to the consumer. The consumer does not make any deposits to the account, and no other transactions occur between March 4 and March 8. From April 1, 2022, through September 30, 2022, creditors will have the option of complying with these revised change-in-terms notice requirements. Similarly, a merchant may provide a $20 gift card to a consumer if the consumer makes $200 worth of qualifying purchases between June 1, 2010 and October 30, 2010. The city, state or foreign country, and the information in 205.9(a)(5) (i), (ii), or (iii), or. A consumer must report an unauthorized electronic fund transfer that appears on a periodic statement within 60 days of the financial institution's transmittal of the statement to avoid liability for subsequent transfers. Payroll. Examples. Section 205.13Administrative Enforcement; Record Retention. If the consumer notifies the institution within 60 days of the transmittal of the periodic statement that shows the unauthorized transfer, the consumer has no liability. 3. Paragraph 11(d)(2)Debiting Provisional Credit. An institution may use any reasonable method to identify the account for which the consumer submits the opt-in notice. This is the case whether or not a particular transfer takes place in the United States and whether or not the financial institution is chartered in the United States or a foreign country. Preauthorized electronic fund transfers from a consumer's account may be authorized only by a writing signed or similarly authenticated by the consumer. The Code of Federal Regulations (CFR) is the official legal print publication containing the codification of the general and permanent rules published in the Federal Register by the departments and agencies of the Federal Government. Disclosures required by paragraphs (a)(4)(iii), (d)(2), (e)(3), and (f)(2) of this section must be made on the certificate or card, or in the case of a loyalty, award, or promotional gift card, on the card, code, or other device. To meet the documentation requirements for periodic statements, a financial institution may: i. (B) The date the financial institution sends a written history of the consumer's account transactions requested by the consumer under paragraph (b)(1)(iii) of this section in which the unauthorized transfer is first reflected. A financial institution may provide the notice required by 205(b)(1)(i) and obtain the consumer's affirmative consent to the financial institution's overdraft service for ATM and one-time debit card transactions prior to July 1, 2010, provided that the financial institution complies with all of the requirements of this section. Cards, codes, or other devices to reimburse employees for travel or moving expenses. One-time debit card transactions. 2. (a) Receipts at electronic terminalsGeneral. (6) Third party transfer. The term electronic fund transfer means any transfer of funds that is initiated through an electronic terminal, telephone, computer, or magnetic tape for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit a consumer's account. 5. The term error does not include: (i) A routine inquiry about the consumer's account balance; (ii) A request for information for tax or other recordkeeping purposes; or. Section 205.20(d) prohibits the accumulation of dormancy, inactivity, or service fees for previous periods into a single fee because such a practice would circumvent the limitation in 205.20(d)(3) that only one fee may be charged per month. A financial institution complies with the rule if it adapts its systems to identify debit card transactions as either one-time or recurring. (1) Types of transfers or inquiries covered. iii. Account-holding institution as third party. Identification of consumer's account. 1. Appendix A to Part 205Model Disclosure Clauses and Forms, Appendix B to Part 205Federal Enforcement Agencies, Appendix C to Part 205Issuance of Staff Interpretations, Supplement I to Part 205Official Staff Interpretations. will also bring you to search results. When more than one access device is issued for an account, the financial institution may, but need not, provide a separate means to identify each user of the account. These services are exempt from coverage, even when a temporary hold on the account is memo-posted electronically at the time of authorization. National banks, and Federal branches and Federal agencies of foreign banks. Memo posting. Type of transfer. The authorization requirement does not apply to any fees assessed by the consumer's account-holding financial institution when it returns the unpaid underlying EFT or check or pays the amount of an overdraft. Duration. Examples of covered transfers. The financial institution shall modify the disclosures under 205.7(b) by disclosing. 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. For example, Regulation D (12 CFR Part 204) restricts the number of payments to third parties that may be made from a money market deposit account; an institution that does not execute fund transfers in excess of those limits must disclose the restriction as a limitation on the frequency of EFTs. ii. In addition, the exclusion in 205.20(b)(5) continues to apply in circumstances where an issuer replaces a gift certificate that was initially issued in paper form with a card or electronic code (for example, to replace a lost paper certificate). Multiple payments/multiple consumers. 2. This content is from the eCFR and may include recent changes applied to the CFR. When you provide a check as payment, you authorize us to use information from your check to make a one-time electronic fund transfer from your account. If the institution sets up the validation procedure in this way, the institution should provide a clear and readily understandable disclosure to the consumer that both devices are unvalidated and that validation will apply to both devices. (4) Disclosure of opt-in right. Any transfer of funds under an agreement between a consumer and a financial institution which provides that the institution will initiate individual transfers without a specific request from the consumer: (i) Between a consumer's accounts within the financial institution; (ii) From a consumer's account to an account of a member of the consumer's family held in the same financial institution; or. If the consumer's delay in notifying the financial institution was due to extenuating circumstances, the institution shall extend the times specified above to a reasonable period. A financial institution may pay overdrafts for ATM and one-time debit card transactions even if a consumer has not affirmatively consented or opted in to the institution's overdraft service. According to California Civil Code Section 827 (a), a landlord can change the terms of a tenancy agreement if he does so in writing and if the amount of advance notice equals the length of time between the tenant's rent payments. The circumstances under which, in the ordinary course of business, the financial institution may provide information concerning the consumer's account to third parties. The notice must also state the dollar amount of the fee. (c) Compliance by account-holding institution. Several of the model clauses include references to a telephone number and address. If the debit item is resubmitted, the institution must continue to honor the stop-payment order (for example, by suspending all subsequent payments to the payee-originator until the consumer notifies the institution that payments should resume). Examples of a generally accepted name for a specific location include a branch of the financial institution, a shopping center, or an airport. A financial institution may issue an unsolicited access device (such as the combination of a debit card and PIN) if the institution's ATM system has been programmed not to accept the access device until after the consumer requests and the institution validates the device. An ATM operator that imposes a fee for a specific type of transactionsuch as for a cash withdrawal, but not for a balance inquiry, or for some cash withdrawals, but not for others (such as where the card was issued by a foreign bank or by a card issuer that has entered into a special contractual relationship with the ATM operator regarding surcharges)may provide a notice on or at the ATM that a fee will be imposed or a notice that a fee may be imposed for providing EFT services or may specify the type of EFT for which a fee is imposed. 25, 1998; 66 FR 17793, Apr. (4) Loyalty, award, or promotional gift card means a card, code, or other device that: (i) Is issued on a prepaid basis primarily for personal, family, or household purposes to a consumer in connection with a loyalty, award, or promotional program; (ii) Is redeemable upon presentation at one or more merchants for goods or services, or usable at automated teller machines; and. Before a gift certificate, store gift card, or general-use prepaid card is purchased, a person that issues or sells such certificate or card must disclose to the consumer the information required by paragraphs (d)(2), (e)(3), and (f)(1) of this section. If you tell us within 2 business days after you learn of the loss or theft of your [card] [code], you can lose no more than $50 if someone used your [card][code] without your permission.). 2. Mortgage plans calling for preauthorized biweekly payments that are debited electronically to the consumer's account and produce a lower total finance charge. Section 205.9Receipts at Electronic Terminals; Periodic Statements. The disclosure required by this paragraph (c)(1)(i) may be made by providing a notice substantially similar to the notice contained in paragraph A7(a) in appendix A of this part. A single telephone number, preceded by the direct inquiries to language, will satisfy the requirements of 205.9(b)(5) and (6). For example, a bar code, card or certificate number, or certificate or coupon electronically provided to a consumer and redeemable for goods and services is not issued in paper form, even if it may be reproduced or otherwise printed on paper by the consumer. An automated teller machine operator that imposes a fee on a consumer for initiating an electronic fund transfer or a balance inquiry shall: (1) Provide notice that a fee will be imposed for providing electronic fund transfer services or a balance inquiry; and. (4) Validated only in response to the consumer's oral or written request for validation, after the institution has verified the consumer's identity by a reasonable means. PART 205ELECTRONIC FUND TRANSFERS (REGULATION E). If the account is still overdrawn after five business days, the institution may impose the fees or finance charges to which it is entitled, if any, under an overdraft credit plan. Section 205.16 permits disclosure on a paper notice as an alternative to the on-screen disclosure. (b) Unsolicited issuance. Consumer liability for unauthorized use of an account. Once redeemed by a consumer, the entire balance on the certificate or card is debited from the certificate or card and credited or transferred to another account established by the merchant of such goods or services. (B) Sixty days after the date the financial institution sends a written history of the consumer's account transactions requested by the consumer under paragraph (b)(1)(iii) of this section in which the alleged error is first reflected. Same facts as in i., except that the gift card also entitles the holder of the gift card to a dollar amount that can be applied towards the purchase of food and beverages or goods or services at the park or at nearby affiliated locations. Upon debiting a provisionally credited amount, the financial institution shall: (i) Notify the consumer of the date and amount of the debiting; (ii) Notify the consumer that the institution will honor checks, drafts, or similar instruments payable to third parties and preauthorized transfers from the consumer's account (without charge to the consumer as a result of an overdraft) for five business days after the notification. Thus, if a merchant or other payee receives a check as payment for the consumer listed on the billing account after providing notice that the check will be processed as a one-time EFT, the authorization from that consumer constitutes authorization to convert any other checks provided for that invoice or statement. The requirement to obtain a consumer's authorization to collect a fee via EFT for the return of an EFT or check unpaid applies only to the person that intends to initiate an EFT to collect the returned item fee from the consumer's account. Approximately when the error took place. Replacement or remaining balance of an expired certificate or card. Because the prepaid card is simply the mechanism for providing the tax refund to the consumer, and the tax preparer does not advertise the ability to obtain tax refunds by a prepaid card, the exclusion in 205.20(b)(4) applies. The financial institution may comply with the requirements of this section by notifying the consumer that the consumer's account will be debited five business days from the transmittal of the notification, specifying the calendar date on which the debiting will occur. The third-party name for recurring payments from federal, state, or local governments need not list the particular agency. 205.16 Disclosures at automated teller machines. Financial institutions exempted from provisionally crediting a consumer's account under 205.11(c)(2)(i) (A) and (B) must still comply with all other requirements of 205.11. A card, code, or other device is excluded from the definition of gift certificate, store gift card, or general-use prepaid card if it meets any of the exclusions in 205.20(b). Extent of required investigation. 1. 6, 2001; 66 FR 17793, Apr. 3. The institution provides an electronic means for the consumer to affirmatively consent. The consumer can then make purchases of songs, media, or virtual goods from the merchant using that account either at the time the value is transferred from the certificate or card or at a later time. Third party providing notice. (3) Average or minimum balance charge. 1. Section 15 is preempted because it is inconsistent with 205.11 and is less protective of the consumer than the federal law. A duplicate credit made to a consumer's account; or. Notice for each transfer. 75 Fed. The primary objective of the act and this part is the protection of individual consumers engaging in electronic fund transfers. 2. A consumer uses a debit card at a public telephone to pay for the call. See also comment 20(c)(2)2. (2) Notice by payor. A consumer may stop payment of a preauthorized electronic fund transfer from the consumer's account by notifying the financial institution orally or in writing at least three business days before the scheduled date of the transfer. Transactions arising from the electronic collection, presentment, or return of checks through the check collection system, such as through transmission of electronic check images. 2. Mall gift cards. vii. If, on the other hand, the consumer keys in the identity of the payee, the receipt must identify the payee by name or by using a code that is explained elsewhere on the receipt. A transfer may be identified, for example, as a purchase, a sale of goods or services, or a payment to a third party. (See Appendix A2.). (d) Notice of transfers varying in amount . A transaction fee may be included in this amount, provided the amount of the fee is disclosed on the receipt and displayed on or at the terminal. (2) Written confirmation. Advance authorization. Access to multiple accounts. If a financial institution makes a telephone line available on Sundays for reporting the loss or theft of an access device, but performs no other business functions, Sunday is not a business day under the substantially all business functions standard. The card is not eligible for the exclusion in 205.20(b)(6) because it is not redeemable solely for the admission or ticket itself (or for goods and services purchased in conjunction with such admission). As a (5) Alternative plans for covering overdrafts. While financial institutions must maintain reasonable procedures to ensure the integrity of data obtained from another institution, a merchant, or other third parties, verification of each transfer that appears on the periodic statement is not required. In contrast, a card, code, or other device generally would not be issued to consumers primarily for personal, family, or household purposes, and therefore would fall outside the scope of 205.20, if the purchaser of the card, code, or device is contractually prohibited from reselling or redistributing the card, code, or device to consumers primarily for personal, family, or household purposes, and reasonable policies and procedures are maintained to avoid such sale or distribution for such purposes. (5) Automatic transfers by account-holding institution. 3101). 1. Our customers that receive e-statements have consented to receive the statement electronically and we send them an e-mail advising them the statement is available. The statement must, however, specify the entity that owns or operates the terminal, plus the city and state. Section 5(4) is preempted to the extent that it relates to the section of state law governing consumer liability for unauthorized use of an access device. 6. Although the card does not qualify for the exclusion for cards, codes, or other devices not marketed to the general public under 205.20(b)(4), it may nevertheless be exempt from the requirements of 205.20 under 205.20(b)(2) if it is reloadable and not marketed or labeled as a gift card or gift certificate. 1. Failure to provide statement. 1. Paragraph 3(c)(5)Automatic Transfers by Account-Holding Institution. (a) Government agency subject to regulation. A financial institution need not provide a consumer the option of receiving notice with each varying transfer, and may instead provide notice only when a debit to an account of the consumer falls outside a specified range or differs by more than a specified amount from the most recent transfer, if the funds are transferred and credited to an account of the consumer held at another financial institution. Under 205.20(a)(6), a service fee includes a periodic fee for holding or use of a gift certificate, store gift card, or general-use prepaid card. [Reg. (3) Relationship between paragraphs (c)(1) and (c)(2) of this section. 3. Paragraph 17(b)(3)Same Account Terms, Conditions, and Features. Federal Deposit Insurance Corporation regional director for the region in which the institution is located. Financial institutions are not required to list preauthorized transfers among the types of transfers that a consumer can make. The term overdraft service does not include any payment of overdrafts pursuant to. Upon request, the institution shall promptly provide copies of the documents. 2. 2. Fees for use of an ATM that are debited directly from the consumer's account by an institution other than the account-holding institution (for example, fees included in the transfer amount) need not be disclosed. For example, an institution satisfies the requirement if it provides a history at an Internet Web site in a format that is capable of being printed or stored electronically using an Internet web browser. Once a financial institution has been notified that the consumer's authorization is no longer valid, it must block all future payments for the particular debit transmitted by the designated payee-originator. For passbook accounts, the financial institution need not provide a periodic statement if the institution updates the passbook upon presentation or enters on a separate document the amount and date of each electronic fund transfer since the passbook was last presented. If the consumer indicates use of a credit card account when in fact a debit card is being used, the payee does not violate the requirement to obtain a written authorization if the failure to obtain written authorization was not intentional and resulted from a bona fide error, and if the payee maintains procedures reasonably adapted to avoid any such error. If we decide to do this, we will credit your account within 10 business days for the amount you think is in error, so that you will have the use of the money during the time it takes us to complete our investigation. (i) The consumer's account balance, through a readily available telephone line; (ii) An electronic history of the consumer's account transactions, such as through an Internet Web site, that covers at least 60 days preceding the date the consumer electronically accesses the account; and. (d) Transfer types and limitations ( 205.7(b)(4)) . 1. (2) Foreign language disclosures. For an electronic certificate or card, disclosures must be provided electronically on the certificate or card provided to the consumer. Electronic debits or credits to consumer accounts for check charges, stop-payment charges, NSF charges, overdraft charges, provisional credits, error adjustments, and similar items that are initiated automatically on the occurrence of certain events. 3. Institutions may tailor Model Form A9 to the methods offered to consumers for affirmatively consenting to the service. When a consumer requests copies of documents, the financial institution must provide the copies in an understandable form. 6. Section 205.9(a)(1) applies to any type of electronic terminal as defined in Regulation E (for example, to POS terminals as well as to ATMs), while 205.16 applies only to ATMs. (2) Standards for determination. Consumer negligence. A certificate or card is available to consumers to purchase five years and six months before the certificate or card expiration date. (6) There may be other exceptions stated in our agreement with you. (5) If circumstances beyond our control (such as fire or flood) prevent the transfer, despite reasonable precautions that we have taken. Fees or charges for overdrafts incurred prior to revocation. If a financial institution uses the telephone notice option, it should be able in most instances to verify during a consumer's initial call whether a transfer was received.

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