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F ederal

r eser v e

Bank

DALLAS. TEXAS

of

Dallas

75222
C ircular No. 79-125
August 1, 1979

REGULATION E— ELECTRONIC FUND TRANSFERS

TO ALL BANKS
AND OTHERS CONCERNED IN THE
ELEVENTH FEDERAL RESERVE DISTRICT:
Enclosed is the printed pamphlet for Regulation E, "Electronic
Fund T ra n s fe rs ," effective March 30, 1979, as amended August 1, 1979.
The pamphlet contains the definitional section of the Regulation as well as
the sections governing the issuance of access devices and the liab ility of
consumers for unauthorized transfers. The entire text of the Electronic
Fund Transfers Act of 1978 appears as the statutory appendix in the
pamphlet, together with the model disclosure clauses for optional use
by financial institutions.
Member banks and others that maintain Regulations Binders
should file this pamphlet in their binders. Any questions concerning
Regulation E should be directed to the Consumer A ffairs Section of our
Bank Supervision and Regulations Department, E xt. 6171.
Sincerely yours,
Robert H . Boykin
First Vice President
Enclosure

Banks and others are encouraged to use the following incoming WATS numbers in contacting this Bank:
1-800-492-4403 (intrastate) and 1-800-527-4970 (interstate). For calls placed locally, please use 651 plus
the extension referred to above.

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

BOARD OF GOVERNORS
of the

FEDERAL RESERVE SYSTEM

ELECTRONIC FUND TRANSFERS

REGULATION E
(12 CFR 205)
Effective March 30, 1979
as amended August 1, 1979

CONTENTS

S e c . 2 0 5 .1 — A u t h o r i t y , P u r p o s e ,
S e c . 2 0 5 .2 — D

............................................................................................................

1

e f i n i t i o n s ..................................................................................................................................................................

1

Se c . 2 0 5 .3 — E x e m

A—

d ix

C o n su m er

f o r U n a u t h o r iz e d

4

...........................................................................................................................................................................

5

ed era l

E

n fo rc em en t

Ag

T

2

......................................................

of

ra n sfers

.....................................................................................................................

15

e n c i e s ..........................................................................................................

18

M o d e l D is c lo s u r e C la u s e s

A p p e n d ix B — F

2

A c c e s s D e v i c e s ........................................................................................................................

of

S e c . 2 0 5 .5 — L ia b il it y

A p p e n d ix

Scope

p t i o n s ..................................................................................................................................................................

S e c . 2 0 5 .4 — I s s u a n c e

S ta tu to ry A p p e n

and

STATUTORY AUTHORITY
This regulation is issued under provisions of section 904 of the Electronic Fund Transfer Act, U.S.C.
Title 15, sec. 1693 et seq.

REGULATION E
(12 CFR 205)

ELECTRONIC FUND TRANSFERS

SECTION 205.1— AUTHORITY,
PURPOSE, AND SCOPE
(a) Authority. This regulation, issued by the
Board of Governors of the Federal Reserve Sys­
tem, implements Title IX (Electronic Fund Trans­
fer Act) of the Consumer Credit Protection Act,
as amended (15 U.S.C. 1601 et seq.).
(b) Purpose and Scope. In November 1978, the
Congress enacted the Electronic Fund Transfer
Act. The Congress found that the use of electronic
systems to transfer funds provides the potential
for substantial benefits to consumers, but that
the unique characteristics of these systems make
the application of existing consumer protection
laws unclear, leaving the rights and liabilities of
users of electronic fund transfer systems unde­
fined. The Act establishes the basic rights, liabili­
ties, and responsibilities of consumers who use
electronic money transfer services and of finan­
cial institutions that offer these services. This regu­
lation is intended to carry out the purposes of
the Act, including, primarily, the protection of
individual consumers engaging in electronic trans­
fers. Except as otherwise provided, this regula­
tion applies to all persons who are financial insti­
tutions as defined in § 205.2(i).
SECTION 205.2— DEFINITIONS
For the purposes of this regulation, the fol­
lowing definitions apply, unless the context indi­
cates otherwise:
(a)(1) “Access device” means a card, code, or
other means of access to a consumer’s account,
or any combination thereof, that may be used by

the consumer for the purpose of initiating elec­
tronic fund transfers.
(2)
An access device becomes an “accepted ac­
cess device” when the consumer to whom the ac­
cess device was issued:
(i) Requests and receives, or signs, or uses, or
authorizes another to use, the access device for
the purpose of transferring money between ac­
counts or obtaining money, property, labor, or
services;
(ii) Requests validation of an access device is­
sued on an unsolicited basis; or
(iii) Receives an access device issued in renewal
of, or in substitution for, an accepted access de­
vice, whether such access device is issued by the
initial financial institution or a successor.
(b) “Account” means a demand deposit (check­
ing), savings, or other consumer asset account
(other than an occasional or incidental credit bal­
ance in a credit plan) held either directly or indi­
rectly by a financial institution and established
primarily for personal, family, or household pur­
poses.
(c) “Act” means the Electronic Fund Transfer
Act (Title IX of the Consumer Credit Protection
Act, 15 U.S.C. 1601 et seq.).
(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.
(e) “Consumer” means a natural person.
(f) “Credit” means the right granted by a finan­
cial institution to a consumer to defer payment of
debt, incur debt and defer its payment, or purchase
property or services and defer payment therefor.

§ 20 5.3

(g) “Electronic fund transfer” means any trans­
fer of funds, other than a transaction originated
by check, draft, or similar paper instrument, that
is initiated through an electronic terminal, tele­
phone, or computer or magnetic tape for the pur­
pose of ordering, instructing, or authorizing a fi­
nancial institution to debit or credit an account.
The term includes, but is not limited to, point-ofsale transfers, automated teller machine transfers,
direct deposits or withdrawals of funds, and trans­
fers initiated by telephone.
(h) “Electronic terminal” means an electronic
device, other than a telephone operated by a con­
sumer, through which a consumer may initiate an
electronic fund transfer. The term includes, but is
not limited to, point-of-sale terminals, automated
teller machines, and cash dispensing machines.
(i) “Financial institution” means a State or Na­
tional bank, a State or Federal savings and loan
association, a State or Federal mutual savings
bank, a State or Federal credit union, or any
other person who, directly or indirectly, holds an
account belonging to a consumer. The term also
includes any person who issues an access device
and agrees with a consumer to provide electronic
fund transfer services.
Two or more financial institutions that jointly
provide electronic fund transfer services may con­
tract among themselves to fulfill the requirements
that the Act and this regulation impose on any
or all of them.
(j) “State” means any State, territory or posses­
sion of the United States, the District of Columbia,
the Commonwealth of Puerto Rico, or any polit­
ical subdivision of any of the above.
(k) “Unauthorized electronic fund transfer”
means an electronic fund transfer from a con­
sumer’s account initiated by a person other than
the consumer without actual authority to initiate
the transfer and from which the consumer receives
no benefit. The term does not include any elec­
tronic fund transfer (1) initiated by a person who
was furnished with the access device to the con­
sumer’s account by the consumer, unless the con­
sumer has notified the financial institution in­
volved that transfers by that person are no longer
authorized, (2) initiated with fraudulent intent by
the consumer or any person acting in concert with
the consumer, or (3) that constitutes an error com­
mitted by the financial institution.

REGULATION E

SECTION 205.3—EXEMPTIONS
This regulation does not apply to the following:
(a) Check guarantee or authorization services.
Any service that guarantees payment or authorizes
acceptance of a check, draft, or similar paper in­
strument and that does not directly result in a
debit or credit to a consumer’s account.
(b) Wire transfers. Any wire transfer of funds
for a consumer through the Federal Reserve Com­
munications System or other similar network that
is used primarily for transfers between financial
institutions or between businesses.
(c) Certain securities or commodities transfers.
Any transfer the primary purpose of which is the
purchase or sale of securities or commodities
through a broker-dealer registered with, or regu­
lated by, the Securities and Exchange Commission
or the Commodity Futures Trading Commission.
(d) Automatic transfers from savings to demand
deposit accounts. Any automatic transfer from a
savings account to a demand deposit (checking)
account under an agreement between a consumer
and a financial institution for the purpose of cov­
ering an overdraft or maintaining a specified mini­
mum balance in the consumer’s checking account
as permitted by 12 CFR Part 217 (Regulation Q)
and 12 CFR Part 329.
(e) Certain telephone-initiated transfers. Any
transfer of funds that (1) is initiated by a telephone
conversation between a consumer and an officer
or employee of a financial institution and (2) is
not under a telephone bill-payment or other pre­
arranged plan or agreement in which periodic or
recurring transfers are contemplated.
(f) Trust accounts. Any trust account held by a
financial institution under a bona fide trust agree­
ment.
SECTION 205.4—ISSUANCE
OF ACCESS DEVICES
(a)
General rule. A financial institution may
issue an access device to a consumer only:
(1)
In response to an oral or written request or
application for the device;1 or
1 In the case o f a joint account, a financial institution
may issue an access device to each account holder for
whom the requesting holder specifically requests an access
device.

REGULATION E

(2) As a renewal of, or in substitution for, an
accepted access device, whether issued by the ini­
tial financial institution or a successor.
(3) As a renewal of, or in substitution for, an
access device issued before February 8, 1979 (other
than an accepted access device, which can be re­
newed or substituted under paragraph (a)(2) of this
section), provided that the disclosures set forth in
paragraphs (d)(1), (2), and (3) of this section ac­
company the renewal or substitute device; except
that for a renewal or substitution that occurs
before July 1, 1979, the disclosures may be sent
within a reasonable time after the renewal or
substitute device is issued.
(b) Exception. Notwithstanding the provisions
of paragraph (a)(1) of this section, a financial in­
stitution may distribute an access device to a con­
sumer on an unsolicited basis if:
(1) The access device is not validated;
(2) The distribution is accompanied by a com­
plete disclosure, in accordance with paragraph (d)
of this section, of the consumer’s rights and lia­
bilities that will apply if the access device is vali­
dated;
(3) The distribution is accompanied by a clear
explanation that the access device is not validated
and how the consumer may dispose of the access
device if validation is not desired; and
(4) The access device is validated only in re­
sponse to the consumer’s oral or written request
or application for validation and after verification
of the consumer’s identity by any reasonable
means, such as by photograph, fingerprint, per­
sonal visit, or signature comparison.
An access device is considered validated when a
financial institution has performed all procedures
necessary to enable a consumer to use it to ini­
tiate an electronic fund transfer.
(c) Relation to Truth in Lending. (1) The Act
and this regulation govern
(i) Issuance of access devices;
(ii) Addition to an accepted credit card, as de­
fined in 12 C FR 226.2(a) (Regulation Z), of the
capability to initiate electronic fund transfers; and
(iii) Issuance of access devices that permit credit
extensions only under a preexisting agreement be­
tween a consumer and a financial institution to
extend the credit when the consumer’s account is
overdrawn or to maintain a specified minimum
balance in the consumer’s account.

§ 2 0 5 .4

(2)

The Truth in Lending Act (15 U.S.C. 1601

et seq.) and 12 CFR Part 226 (Regulation Z),

which prohibit the unsolicited issuance of credit
cards, govern
(i) Issuance of credit cards as defined in 12
C FR 226.2(r);
(ii) Addition of a credit feature to an accepted
access device; and
(iii) Issuance of credit cards that are also ac­
cess devices, except as provided in paragraph
(c)(l)(iii) of this section.
(d)
Transitional disclosure requirements. Until
May 10, 1980, a financial institution may satisfy
the disclosure requirements of paragraph (b)(2)
of this section by disclosing to the consumer, in
a written statement that the consumer may retain,
the following terms in readily understandable
language:
(1) The consumer’s liability under § 205.5, or
under other applicable law or agreement, for un­
authorized electronic fund transfers and, at the
financial institution’s option, notice of the advis­
ability of prompt reporting of any loss, theft, or
unauthorized transfers.
(2) The telephone number and address of the
person or office to be notified in the event the
consumer believes that an unauthorized electronic
fund transfer has been or may be made.
(3) The financial institution’s business days, as
determined under § 205.2(d).
(4) The type of electronic fund transfers that
the consumer may initiate, including any limita­
tions on the frequency or dollar amount of the
transfers. The details of the limitations need not
be disclosed if their confidentiality is necessary
to maintain the security of the electronic fund
transfer system.
(5) Any charges for electronic fund transfers
or for the right to make transfers.
(6) The conditions under which the financial
institution in the ordinary course of business will
disclose information about the consumer’s account
to third parties.
(7) Whether or not the financial institution
will provide documentation of electronic fund
transfers, such as receipts or periodic statements,
to the consumer.
(8) Whether or not the financial institution has
error resolution procedures and, if so, a summary
of those procedures.

§ 205.5

REGULATION E

(ii)
The amount of unauthorized electronic
fund transfers that the financial institution es­
tablishes would not have occurred but for the
failure of the consumer to notify the institution
within 2 business days after the consumer learns
SECTION 205.5— LIABILITY OF CONSUMER
of the loss or theft of the access device, and that
FOR UNAUTHORIZED TRANSFERS
occur after the close of 2 business days and before
notice to the financial institution.
(a) General rule. A consumer is liable, within
(2) If the consumer fails to report within 60
the limitations described in paragraph (b) of this
days of transmittal of the periodic statement any
section, for unauthorized electronic fund transfers
unauthorized electronic fund transfer that appears
involving the consumer’s account only if:
on the statement, the consumer’s liability shall
(1) the access device used for the unauthorized
not exceed the sum of
transfers is an accepted access device;
(i) The lesser of $50 or the amount of un­
authorized electronic fund transfers that appear
(2) the financial institution has provided a
on the periodic statement or that occur during
means (such as by signature, photograph, finger­
print, or electronic or mechanical confirmation) to
the 60-day period, and
(ii) The amount of unauthorized electronic fund
identify the consumer to whom the access device
transfers that occur after the close of the 60 days
was issued; and
and before notice to the financial institution and
(3) the financial institution has provided the
that the financial institution establishes would not
following information, in writing, to the consumer:
have occurred but for the failure of the consumer
(i) The consumer’s liability under § 205.5, or
to notify the financial institution within that time.
under other applicable law or agreement, for un­
(3) Paragraphs (b)(1) and (2) of this section
authorized electronic fund transfers and, at the
may both apply in some circumstances, Paragraph
financial institution’s option, notice of the advis­
(b)(1) shall determine the consumer’s liability for
ability of prompt reporting of any loss, theft, or
any unauthorized transfers that appear on the
unauthorized transfers.
periodic statement and occur before the close of
(ii) The telephone number and address of the
the 60-day period, and paragraph (b)(2)(ii) shall
person or office to be notified in the event the
determine liability for transfers that occur after
consumer believes that an unauthorized electronic
the close of the 60-day period.
fund transfer has been or may be made.
(4) If a delay in notifying the financial insti­
(iii) The financial institution’s business days, as
tution was due to extenuating circumstances, such
determined under § 205.2(d), unless applicable
as extended travel or hospitalization, the time
State law or an agreement between the consumer
periods specified above shall be extended to a
and the financial institution sets a liability limit
reasonable time.
not greater than $50.
(b) Limitations on amount of liability. The
(5) If applicable State law or an agreement
amount of a consumer’s liability for an unauthor­
between the consumer and financial institution
ized electronic fund transfer or a series of trans­
imposes lesser liability than that provided in
fers arising from a single loss or theft of the
paragraph (b) of this section, the consumer’s liabil­
access device shall not exceed $50 or the amount
ity shall not exceed that imposed under that law
of unauthorized electronic fund transfers that oc­
or agreement.
cur before notice to the financial institution under
(c)
Notice to financial institution. For pur­
paragraph (c) of this section, whichever is less,
poses of this section, notice to a financial institu­
unless one or both of the following exceptions
tion is given when a consumer takes such steps
apply:
as are reasonably necessary to provide the finan­
(1)
If the consumer fails to notify the financial cial institution with the pertinent information,
institution within 2 business days after learning
whether or not any particular officer, employee,
of the loss or theft of the access device, the con­
or agent of the financial institution does in fact
sumer’s liability shall not exceed the lesser of
receive the information. Notice may be given
to the financial institution, at the consumer’s op­
$500 or the sum of
(i)
$50 or the amount of unauthorized elec­ tion, in person, by telephone, or in writing. Notice
tronic fund transfers that occur before the close
in writing is considered given at the time of
of the 2 business days, whichever is less, and
receipt or, whether or not received, at the ex­
(9)
The conditions under which the financial
institution will assume liability for the institution’s
failure to make electronic fund transfers.

S T A T U T O R Y APPENDIX

REGULATION E

piration of the time ordinarily required for trans­
mission, whichever is earlier. Notice is also con­
sidered given when the financial institution be­
comes aware of circumstances that lead to the
reasonable belief that an unauthorized electronic
fund transfer involving the consumer’s account
has been or may be made.
(d)
Relation to Truth in Lending. (1) A con­
sumer’s liability for an unauthorized electronic
fund transfer shall be determined solely in ac­
cordance with this section if the electronic fund
transfer
(1) Was initiated by use of an access device
that is also a credit card as defined in 12 C FR
226.2(r), or
(ii)
Involves an extension of credit under an
agreement between a consumer and a financial
institution to extend the credit when the con­
sumer’s account is overdrawn or to maintain a
specified minimum balance in the consumer’s
account.
(2) A consumer’s liability for unauthorized use
of a credit card that is also an access device but
that does not involve an electronic fund transfer
shall be determined solely in accordance with
the Truth in Lending Act and 12 C FR Part 226
(Regulation Z).

legislation is unclear, leaving the rights and liabili­
ties of consumers, financial institutions, and inter­
mediaries in electronic fund transfers undefined.
(b)
It is the purpose of this title to provide a
basic framework establishing the rights, liabilities,
and responsibilities of participants in electronic
fund transfer systems. The primary objective of
this title, however, is the provision of individual
consumer rights.
§ 903. Definitions

As used in this title—
(1) the term “accepted card or other means of
access” means a card, code, or other means of
access to a consumer’s account for the purpose
of initiating electronic fund transfers when the
person to whom such card or other means of
access was issued has requested and received or
has signed or has used, or authorized another to
use, such card or other means of access for the
purpose of transferring money between accounts
or obtaining money, property, labor, or services;
(2) the term “account” means a demand deposit,
savings deposit, or other asset account (other
than an occasional or incidental credit balance in
an open end credit plan as defined in section
103(i) of this Act), as described in regulations of
the Board, established primarily for personal,
family, or household purposes, but such term
STATUTORY APPEND IX
does not include an account held by a financial
institution pursuant to a bona fide trust agree­
FINANCIAL INSTITUTIONS REGULATORY
ment;
AND INTEREST RATE CONTROL
ACT OF 1978
(3) the term “Board” means the Board of Gov­
ernors of the Federal Reserve System;
PUBLIC LAW 95-630
(4) the term “business day” means any day on
which the offices of the consumer’s financial in­
TITLE XX—ELECTRONIC FUND TRANSFERS
stitution involved in an electronic fund transfer
are open to the public for carrying on substan­
Sec. 2001. The Consumer Protection Act (15
tially all of its business functions;
U.S.C. 1601 et seq.) is amended by adding at
(5) the term “consumer” means a natural per­
the end thereof the following new title:
son;
(6) the term “electronic fund transfer” means
TITLE IX—ELECTRONIC FUND TRANSFERS
any transfer of funds, other than a transaction
§ 901. Short title
originated by check, draft, or similar paper in­
strument, which is initiated through an electronic
This title may be cited as the “Electronic Fund
terminal, telephonic instrument, or computer or
Transfer Act”.
magnetic tape so as to order, instruct, or author­
ize a financial institution to debit or credit an
§ 902. Findings and purpose
account. Such term includes, but is not limited to,
(a)
The Congress finds that the use of electronic point-of-sale transfers, automated teller machine
systems to transfer funds provides the potential
transactions, direct deposits or withdrawals of
for substantial benefits to consumers. However,
funds, and transfers initiated by telephone. Such
due to the unique characteristics of such systems,
term does not include—
the application of existing consumer protection
(A) any check guarantee or authorization serv­

REGULATION E

S T A T U T O R Y APPENDIX

ice which does not directly result in a debit or
credit to a consumer’s account;
(B) any transfer of funds, other than those
processed by automated clearinghouse, made by
a financial institution on behalf of a consumer by
means of a service that transfers funds held at
either Federal Reserve banks or other depository
institutions and which is not designed primarily
to transfer funds on behalf of a consumer;
(C) any transaction the primary purpose of
which is the purchase or sale of securities or
commodities through a broker-dealer registered
with or regulated by the Securities and Exchange
Commission;
(D) any automatic transfer from a savings ac­
count to a demand deposit account pursuant to
an agreement between a consumer and a financial
institution for the purpose of covering an over­
draft or maintaining an agreed upon minimum
balance in the consumer’s demand deposit ac­
count; or
(E) any transfer of funds which is initiated by
a telephone conversation between a consumer and
an officer or employee of a financial institution
which is not pursuant to a prearranged plan and
under which periodic or recurring transfers are
not contemplated;
as determined under regulations of the Board;
(7) the term “electronic terminal” means an
electronic device, other than a telephone operated
by a consumer, through which a consumer may
initiate an electronic fund transfer. Such term
includes but is not limited to, point-of-sale ter­
minals, automated teller machines, and cash dis­
pensing machines;
(8) the term “financial institution” means a State
or National bank, a State or Federal savings and
loan association, a mutual savings bank, a State
or Federal credit union, or any other person who,
directly or indirectly, holds an account belonging
to a consumer;
(9) the term “preauthorized electronic fund
transfer” means an electronic fund transfer au­
thorized in advance to recur at substantially regu­
lar intervals;
(10) the term “State” means any State, territory,
or possession of the United States, the District
of Columbia, the Commonwealth of Puerto Rico,
or any political subdivision of any of the fore­
going; and
(11) the term “unauthorized electronic fund

transfer” means an electronic fund transfer from
a consumer’s account initiated by a person other
than the consumer without actual authority to
initiate such transfer and from which the con­
sumer receives no benefit, but the term does not
include any electronic fund transfer (A) initiated
by a person other than the consumer who was
furnished with the card, code, or other means of
access to such consumer’s account by such con­
sumer, unless the consumer has notified the finan­
cial institution involved that transfers by such
other person are no longer authorized, (B) ini­
tiated with fraudulent intent by the consumer or
any person acting in concert with the consumer,
or (C) which constitutes an error committed by
a financial institution.

§ 904. Regulations
(a) The Board shall prescribe regulations to
carry out the purposes of this title. In prescribing
such regulations, the Board shall:
(1) consult with the other agencies referred to
in section 917 and take into account, and allow
for, the continuing evolution of electronic bank­
ing services and the technology utilized in such
services,
(2) prepare an analysis of economic impact
which considers the cost and benefits to financial
institutions, consumers, and other users of elec­
tronic fund transfers, including the extent to
which additional documentation, reports, records,
or other paper work would be required, and the
effects upon competition in the provision of elec­
tronic banking services among large and small
financial institutions and the availability of such
services to different classes of consumers, par­
ticularly low income consumers,
(3) to the extent practicable, the Board shall
demonstrate that the consumer protections of the
proposed regulations outweigh the compliance
costs imposed upon consumers and financial insti­
tutions, and
(4) any proposed regulations and accompany­
ing analyses shall be sent promptly to Congress
by the Board.
(b) The Board shall issue model clauses for op­
tional use by financial institutions to facilitate
compliance with the disclosure requirements of
section 905 and to aid consumers in understand­
ing the rights and responsibilities of participants
in electronic fund transfers by utilizing readily

REGULATION E

understandable language. Such model clauses shall
be adopted after notice duly given in the Federal
Register and opportunity for public comment in
accordance with section 553 of title 5, United
States Code. With respect to the disclosures re­
quired by section 905(a) (3) and (4), the Board
shall take account of variations in the services
and charges under different electronic fund trans­
fer systems and, as appropriate, shall issue alter­
native model clauses for disclosure of these differ­
ing account terms.
(c) Regulations prescribed hereunder may con­
tain such classifications, differentiations, or other
provisions, and may provide for such adjustments
and exceptions for any class of electronic fund
transfers, as in the judgment of the Board are
necessary or proper to effectuate the purposes
of this title, to prevent circumvention or evasion
thereof, or to facilitate compliance therewith.
The Board shall by regulation modify the require­
ments imposed by this title on small financial
institutions if the Board determines that such
modifications are necessary to alleviate any undue
compliance burden on small financial institutions
and such modifications are consistent with the
purpose and objective of this title.
(d) In the event that electronic fund transfer
services are made available to consumers by a
person other than a financial institution holding a
consumer’s account, the Board shall by regulation
assure that the disclosures, protections, responsi­
bilities, and remedies created by this title are
made applicable to such persons and services.

S T A T U T O R Y APPENDIX

fund transfer has been or may be effected;
(3) the type and nature of electronic fund
transfers which the consumer may initiate, includ­
ing any limitations on the frequency or dollar
amount of such transfers, except that the details
of such limitations need not be disclosed if their
confidentiality is necessary to maintain the secu­
rity of an electronic fund transfer system, as
determined by the Board;
(4) any charges for electronic fund transfers
or for the right to make such transfers;
(5) the consumer’s right to stop payment of a
preauthorized electronic fund transfer and the
procedure to initiate such a stop payment order;
(6) the consumer’s right to receive documenta­
tion of electronic fund transfers under section
906;
(7) a summary, in a form prescribed by regu­
lations of the Board, of the error resolution pro­
visions of section 908 and the consumer’s rights
thereunder. The financial institution shall there­
after transmit such summary at least once per
calendar year;
(8) the financial institution’s liability to the con­
sumer under section 910; and
(9) under what circumstances the financial in­
stitution will in the ordinary course of business
disclose information concerning the consumer’s
account to third persons.
(b) A financial institution shall notify a con­
sumer in writing at least twenty-one days prior
to the effective date of any change in any term
or condition of the consumer’s account required
to be disclosed under subsection (a) if such change
§ 905. Terms and conditions of transfers
would result in greater cost or liability for such
(a)
The terms and conditions of electronic fund consumer or decreased access to the consumer’s
transfers involving a consumer’s account shall be
account. A financial institution may, however,
disclosed at the time the consumer contracts for
implement a change in the terms or conditions
of an account without prior notice when such
an electronic fund transfer service, in accordance
with regulations of the Board. Such disclosures
change is immediately necessary to maintain or
restore the security of an electronic fund transfer
shall be in readily understandable language and
system or a consumer’s account. Subject to sub­
shall include, to the extent applicable—
section (a)(3), the Board shall require subsequent
(1) the consumer’s liability for unauthorized
notification if such a change is made permanent.
electronic fund transfers and, at the financial in­
(c) For any account of a consumer made ac­
stitution’s option, notice of the advisability of
cessible to electronic fund transfers prior to the
prompt reporting of any loss, theft, or unauthor­
effective date of this title, the information re­
ized use of a card, code, or other means of access;
quired to be disclosed to the consumer under
(2) the telephone number and address of the
subsection (a) shall be disclosed not later than
person or office to be notified in the event the
the earlier of—
consumer believes that an unauthorized electronic

S T A T U T O R Y APPENDIX

(1) the first periodic statement required by
section 906(c) after the effective date of this title;
(2) thirty days after the effective date of this
title.

§ 906. Documentation of transfers; periodic
statements
(a) For each electronic fund transfer initiated
by a consumer from an electronic terminal, the
financial institution holding such consumer’s ac­
count shall, directly or indirectly, at the time the
transfer is initiated, make available to the con­
sumer written documentation of such transfer.
The documentation shall clearly set forth to the
extent applicable—
(1) the amount involved and date the transfer
is initiated;
(2) the type of transfer;
(3) the identity of the consumer’s account with
the financial institution from which or to which
funds are transferred;
(4) the identity of any third party to whom
or from whom funds are transferred; and
(5) the location or identification of the elec­
tronic terminal involved.
(b) For a consumer’s account which is sched­
uled to be credited by a preauthorized electronic
fund transfer from the same payor at least once
in each successive sixty-day period, except where
the payor provides positive notice of the transfer
to the consumer, the financial institution shall
elect to provide promptly either positive notice
to the consumer when the credit is made as sched­
uled, or negative notice to the consumer when
the credit is not made as scheduled, in accordance
with regulations of the Board. The means of
notice elected shall be disclosed to the consumer
in accordance with section 905.
(c) A financial institution shall provide each
consumer with a periodic statement for each ac­
count of such consumer that may be accessed
by means of an electronic fund transfer. Except
as provided in subsections (d) and (e), such state­
ment shall be provided at least monthly for each
monthly or shorter cycle in which an electronic
fund transfer affecting the account has occurred,
or every three months, whichever is more fre­
quent. The statement, which may include infor­

REGULATION E

mation regarding transactions other than elec­
tronic fund transfers, shall clearly set forth—
(1) with regard to each electronic fund transfer
during the period, the information described in
subsection (a), which may be provided on an
accompanying document;
(2) the amount of any fee or charge assessed
by the financial institution during the period for
electronic fund transfers or for account mainte­
nance;
(3) the balances in the consumer’s account at
the beginning of the period and at the close of
the period; and
(4) the address and telephone number to be
used by the financial institution for the purpose
of receiving any statement inquiry or notice of
account error from the consumer. Such address
and telephone number shall be preceded by the
caption “Direct Inquiries To;” or other similar
language indicating that the address and number
are to be used for such inquiries or notices.
(d) In the case of a consumer’s passbook ac­
count which may not be accessed by electronic
fund transfers other than preauthorized electronic
fund transfers crediting the account, a financial
institution may, in lieu of complying with the re­
quirements of subsection (c), upon presentation
of the passbook provide the consumer in writing
with the amount and date of each such transfer
involving the account since the passbook was last
presented.
(e) In the case of a consumer’s account other
than a passbook account, which may not be ac­
cessed by electronic fund transfers other than pre­
authorized electronic fund transfers crediting the
account, the financial institution may provide a
periodic statement on a quarterly basis which
otherwise complies with the requirements of sub­
section (c).
(f) In any action involving a consumer, any
documentation required by this section to be given
to the consumer which indicates that an electronic
fund transfer was made to another person shall
be admissable as evidence of such transfer and
shall constitute prima facie proof that such trans­
fer was made.

§ 907. Preauthorized transfers
(a)
A preauthorized electronic fund transfer
from a consumer’s account may be authorized

REGULATION E

by the consumer only in writing, and a copy of
such authorization shall be provided to the con­
sumer when made. A consumer may stop payment
of a preauthorized electronic fund transfer by
notifying the financial institution orally or in
writing at any time up to three business days
preceding the scheduled date of such transfer.
The financial institution may require written con­
firmation to be provided to it within fourteen
days of an oral notification if, when the oral
notification is made, the consumer is advised of
such requirement and the address to which such
confirmation should be sent.
(b)
In the case of preauthorized transfers from
a consumer’s account to the same person which
may vary in amount, the financial institution or
designated payee shall, prior to each transfer,
provide reasonable advance notice to the con­
sumer, in accordance with regulations of the
Board, of the amount to be transferred and the
scheduled date of the transfer.

S T A T U T O R Y APPENDIX

be sent. A financial institution which requires
written confirmation in accordance with the pre­
vious sentence need not provisionally recredit a
consumer’s account in accordance with subsection
(c), nor shall the financial institution be liable
under subsection (e) if the written confirmation
is not received within the ten-day period referred
to in the previous sentence.
(b) If the financial institution determines that an
error did occur, it shall promptly, but in no event
more than one business day after such determi­
nation, correct the error, subject to section 909,
including the crediting of interest where appli­
cable.
(c) If a financial institution receives notice of
an error in the manner and within the time period
specified in subsection (a), it may, in lieu of the
requirements of subsections (a) and (b), within
ten business days after receiving such notice pro­
visionally recredit the consumer’s account for the
amount alleged to be in error, subject to section
909, including interest where applicable, pending
the conclusion of its investigation and its deter­
§ 908. Error resolution
mination of whether an error has occurred. Such
(a)
If a financial institution, within sixty days investigation shall be concluded not later than
after having transmitted to a consumer documen­
forty-five days after receipt of notice of the error.
tation pursuant to section 906 (a), (c), or (d) or
During the pendency of the investigation, the
notification pursuant to section 906(b), receives
consumer shall have full use of the funds pro­
oral or written notice in which the consumer—
visionally recredited.
(1) sets forth or otherwise enables the financial
(d) If the financial institution determines after
institution to identify the name and account num­
its investigation pursuant to subsection (a) or (c)
ber of the consumer;
that an error did not occur, it shall deliver or
(2) indicates the consumer’s belief that the
mail to the consumer an explanation of its find­
documentation, or, in the case of notification
ings within 3 business days after the conclusion
pursuant to section 906(b), the consumer’s ac­
of its investigation, and upon request of the con­
count, contains an error and the amount of such
sumer promptly deliver or mail to the consumer
error; and
reproductions of all documents which the financial
(3) sets forth the reasons for the consumer’s
institution relied on to conclude that such error
belief (where applicable) that an error has oc­
did not occur. The financial institution shall in­
curred,
clude notice of the right to request reproductions
with the explanation of its findings.
the financial institution shall investigate the al­
(e) If in any action under section 915, the court
leged error, determine whether an error has oc­
finds that—
curred, and report or mail the results of such
investigation and determination to the consumer
(1)
the financial institution did not provision­
within ten business days. The financial institution
ally recredit a consumer’s account within the
may require written confirmation to be provided
ten-day period specified in subsection (c), and the
to it within ten business days of an oral notifica­
financial institution (A) did not make a good
tion of error if, when the oral notification is made,
faith investigation of the alleged error, or (B) did
the consumer is advised of such requirement and
not have a reasonable basis for believing that the
the address to which such confirmation should
consumer’s account was not in error; or

S T A T U T O R Y APPENDIX

RE G U L A T I O N E

transfer involving the consumer’s account has
been or may be effected. Notice under this para­
graph is sufficient when such steps have 'been
taken as may be reasonably required in the ordi­
nary course of business to provide the financial
institution with the pertinent information, whether
or not any particular officer, employee, or agent
of the financial institution does in fact receive
such information.
Notwithstanding the foregoing, reimbursement
need not be made to the consumer for losses the
financial institution establishes would not have
occurred but for the failure of the consumer to
report within sixty days of transmittal of the
statement (or in extenuating circumstances such
as extended travel or hospitalization, within a
reasonable time under the circumstances) any un­
authorized electronic fund transfer or account
error which appears on the periodic statement
provided to the consumer under section 906. In
addition, reimbursement need not be made to
the consumer for losses which the financial insti­
tution establishes would not have occurred but
for the failure of the consumer to report any loss
or theft of a card or other means of access
within two business days after the consumer learns
of the loss or theft (or in extenuating circum­
stances such as extended travel or hospitalization,
§ 909. Consumer liability for unauthorized
within a longer period which is reasonable under
transfers
the circumstances), but the consumer’s liability
(a)
A consumer shall be liable for any unau­ under this subsection in any such case may not
exceed a total of $500, or the amount of unau­
thorized electronic fund transfer involving the
thorized electronic fund transfers which occur
account of such consumer only if the card or other
following the close of two business days (or such
means of access utilized for such transfer was an
longer period) after the consumer learns of the
accepted card or other means of access and if the
loss or theft but prior to notice to the financial
issuer of such card, code, or other means of ac­
institution under this subsection, whichever is less.
cess has provided a means whereby the user of
such card, code, or other means of access can be
(b)
In any action which involves a consumer’s
identified as the person authorized to use it, such
liability for an unauthorized electronic fund trans­
as by signature, photograph, or fingerprint or by
fer, the burden of proof is upon the financial
electronic or mechanical confirmation. In no
institution to show that the electronic fund trans­
event, however, shall a consumer’s liability for
fer was authorized or, if the electronic fund
an unauthorized transfer exceed the lesser of—
transfer was unauthorized, then the burden of
proof is upon the financial institution to establish
(1) $50; or
that the conditions of liability set forth in sub­
(2) the amount of money or value of property
section (a) have been met, and, if the transfer
or services obtained in such unauthorized elec­
was initiated after the effective date of section
tronic fund transfer prior to the time the financial
905, that the disclosures required to be made to
institution is notified of, or otherwise becomes
the consumer under section 905(a) (1) and (2)
aware of, circumstances which lead to the reason­
were in fact made in accordance with such section.
able belief that an unauthorized electronic fund

(2)
the financial institution knowingly and will­
fully concluded that the consumer’s account was
not in error when such conclusion could not rea­
sonably have been drawn from the evidence
available to the financial institution at the time of
its investigation, then the consumer shall be en­
titled to treble damages determined under section
915(a)(1).
(f)
For the purpose of this section, an error
consists of—
(1) an unauthorized electronic fund transfer;
(2) an incorrect electronic fund transfer from
or to the consumer’s account;
(3) the omission from a periodic statement of
an electronic fund transfer affecting the con­
sumer’s account which should have been included;
(4) a computational error by the financial insti­
tution;
(5) the consumer’s receipt of an incorrect
amount of money from an electronic terminal;
(6) a consumer’s request for additional infor­
mation or clarification concerning an electronic
fund transfer or any documentation required by
this title; or
(7) any other error described in regulations of
the Board.

REGULATION E

(c) In the event of a transaction which involves
both an unauthorized electronic fund transfer and
an extension of credit as defined in section 103(e)
of this Act pursuant to an agreement between the
consumer and the financial institution to extend
such credit to the consumer in the event the con­
sumer’s account is overdrawn, the limitation on
the consumer’s liability for such transaction shall
be determined solely in accordance with this sec­
tion.
(d) Nothing in this section imposes liability
upon a consumer for an unauthorized electronic
fund transfer in excess of his liability for such a
transfer under other applicable law or under any
agreement with the consumer’s financial institu­
tion.
(e) Except as provided in this section, a con­
sumer incurs no liability from an unauthorized
electronic fund transfer.

S T A T U T O R Y APPENDIX

accordance with the terms and conditions of the
account.
(b) A financial institution shall not be liable
under subsection (a)(1) or (2) if the financial in­
stitution shows by a preponderance of the evi­
dence that its action or failure to act resulted
from—
(1) an act of God or other circumstance be­
yond its control, that it exercised reasonable care
to prevent such an occurrence, and that it exer­
cised such diligence as the circumstances required;

(2) a technical malfunction which was known
to the consumer at the time he attempted to ini­
tiate an electronic fund transfer or, in the case
of a preauthorized transfer, at the time such
transfer should have occurred.
(c) In the case of a failure described in sub­
section (a) which was not intentional and which
resulted from a bona fide error, notwithstand­
§ 910. Liability of financial institutions
ing the maintenance of procedures reasonably
(a)
Subject to subsections (b) and (c), a finan­ adapted to avoid any such error, the financial
institution shall be liable for actual damages
cial institution shall be liable to a consumer for
proved.
all damages proximately caused by—
(1) the financial institution’s failure to make
§ 911. Issuance of cards or other means of access
an electronic fund transfer, in accordance with
the terms and conditions of an account, in the
(a) No person may issue to a consumer any
correct amount or in a timely manner when
card, code, or other means of access to such con­
properly instructed to do so by the consumer,
sumer’s account for the purpose of initiating an
except where—
electronic fund transfer other than—
(A) the consumer’s account has insufficient
(1) in response to a request or application
funds;
therefor; or
(B) the funds are subject to legal process or
(2) as a renewal of, or in substitution for, an
other encumbrance restricting such transfer;
acepted card, code, or other means of access,
(C) such transfer would exceed an established
whether issued by the initial issuer or a successor.
credit limit;
(b) Notwithstanding the provisions of subsec­
(D) an electronic terminal has insufficient cash
tion (a), a person may distribute to a consumer on
to complete the transaction; or
an unsolicited basis a card, code, or other means
(E) as otherwise provided in regulations of the
of access for use in initiating an electronic fund
Board;
transfer from such consumer’s account, if—
(2) the financial institution’s failure to make
(1) such card, code, or other means of access
an electronic fund transfer due to insufficient
is not validated;
funds when the financial institution failed to
(2) such distribution is accompanied by a com­
credit,, in accordance with the terms and condi­
plete disclosure, in accordance with section 905,
tions of an account, a deposit of funds to the
of the consumer’s rights and liabilities Which will
consumer’s account which would have provided
apply if such card, code, or other means of access
sufficient funds to make the transfer, and
is validated;
(3) the financial institution’s failure to stop
(3) such distribution is accompanied by a clear
payment of a preauthorized transfer from a con­
explanation, in accordance with regulations of
sumer’s account when instructed to do so in
the Board, that such card, code, or other means

S T A T U T O R Y APPENDIX

RE G U L A T I O N E

solved in accordance with section 908, is liable
to such consumer in an amount equal to the
sum of—
(1) any actual damage sustained by such con­
sumer as a result of such failure;
(2)(A) in the case of an individual action, an
amount not less than $100 nor greater than
$1,000; or
(B)
in the case of a class action, such amount
as the court may allow, except that (i) as to each
member of the class no minimum recovery shall
be applicable, and (ii) the total recovery under
§ 912. Suspension of obligations
this subparagraph in any class action or series of
If a system malfunction prevents the effectua­
class actions arising out of the same failure to
tion of an electronic fund transfer initiated by
comply by the same person shall not be more
a consumer to another person, and such other
than the lesser of $500,000 or 1 per centum of
person has agreed to accept payment by such
the net worth of the defendant; and
means, the consumer’s obligation to the other
(3)
in the case of any successful action to en­
person shall be suspended until the malfunction
force the foregoing liability, the costs of the
is corrected and the electronic fund transfer may
action, together with a reasonable attorney’s fee
be completed, unless such other person has sub­
as determined by the court.
sequently, by written request, demanded payment
(b) In determining the amount of liability in
by means other than an electronic fund transfer.
any action under subsection (a), the court shall
consider, among other relevant factors—
§ 913. Compulsory use of
(1) in any individual action under subsection
electronic fund transfers
(a)(2)(A), the frequency and persistence of non­
No person may—
compliance, the nature of such noncompliance,
(1) condition the extension of credit to a con­
and the extent to which the noncompliance was
sumer on such consumer’s repayment by means
intentional; or
of preauthorized electronic fund transfers; or
(2) in any class action under subsection (a)
(2) require a consumer to establish an account
(2)(B), the frequency and persistence of noncom­
for receipt of electronic fund transfers with a
pliance, the nature of such noncompliance, the
particular financial institution as a condition of
resources of the defendant, the number of per­
employment or receipt of a government benefit.
sons adversely affected, and the extent to which
the noncompliance was intentional.
§ 914. Waiver of rights
(c) Except as provided in section 910, a person
No writing or other agreement between a con­
may not be held liable in any action brought
sumer and any other person may contain any
under this section for a violation of this title if
provision which constitutes a waiver of any right
the person shows by a preponderance of evidence
conferred or cause of action created by this title.
that the violation was not intentional and resulted
Nothing in this section prohibits, however, any
from a bona fide error notwithstanding the main­
writing or other agreement which grants to a con­
tenance of procedures reasonably adapted to avoid
sumer a more extensive right or remedy or greater
any such error.
protection than contained in this title or a waiver
(d) No provision of this section or section 916
given in settlement of a dispute or action.
imposing any liability shall apply to—
§ 915. Civil liability
(1)
any act done or omitted in good faith in
(a)
Except as otherwise provided by this sec­ conformity with any rule, regulation, or inter­
pretation thereof by the Board or in conformity
tion and section 910, any person who fails to
with any interpretation or approval by an official
comply with any provision of this title with
or employee of the Federal Reserve System duly
respect to any consumer, except for an error re­
of access is not validated and how the consumer
may dispose of such code, card, or other means
of access if validation is not desired; and
(4)
such card, code, or other means of access
is validated only in response to a request or ap­
plication from the consumer, upon verification
of the consumer’s identity.
(c)
For the purpose of subsection (b), a card,
code, or other means of access is validated when
it may be used to initiate an electronic fund
transfer.

REGULATION E

authorized by the Board to issue such interpreta­
tions or approvals under such procedures as the
Board may prescribe therefor; or
(2)
any failure to make disclosure in proper
form if a financial institution utilized an appro­
priate model clause issued by the Board,
notwithstanding that after such act, omission, or
failure has occurred, such rule, regulation, ap­
proval, or model clause is amended, rescinded,
or determined by judicial or other authority to
be invalid for any reason.
(e) A person has no liability under this section
for any failure to comply with any requirement
under this title if, prior to the institution of an
action under this section, the person notifies the
consumer concerned of the failure, complies with
the requirements of this title, and makes an ap­
propriate adjustment to the consumer’s account
and pays actual damages or, where applicable,
damages in accordance with section 910.
(f) On a finding by the court that an unsuc­
cessful action under this section was brought in
bad faith or for purposes of harassment, the
court shall award to the defendant attorney’s
fees reasonable in relation to the work expended
and costs.
(g) Without regard to the amount in contro­
versy, any action under this section may be
brought in any United States district court, or in
any other court of competent jurisdiction, within
one year from the date of the occurrence of the
violation.

§ 916. Criminal liability
(a) Whoever knowingly and willfully—
(1) gives false or inaccurate information or
fails to provide information which he is required
to disclose by this title or any regulation issued
thereunder; or
(2) otherwise fails to comply with any pro­
vision of this title; shall be fined not more than
$5,000 or imprisoned not more than one year,
or both.
(b) Whoever—
(1)
knowingly, in a transaction affecting inter­
state or foreign commerce, uses or attempts or
conspires to use any counterfeit, fictitious, altered,
forged, lost, stolen, or fraudulently obtained debit
instrument to obtain money, goods, services, or
anything else of value which within any one-year

S T A T U T O R Y APPENDIX

period has a value aggregating $1,000 or more;
or
(2) with unlawful or fraudulent intent, trans­
ports or attempts or conspires to transport in
interstate or foreign commerce a counterfeit, fic­
titious, altered, forged, lost, stolen, or fraudulently
obtained debit instrument knowing the same to
be counterfeit, fictitious, altered, forged, lost,
stolen, or fraudulently obtained; or
(3) with unlawful or fraudulent intent, uses
any instrumentality of interstate or foreign com­
merce to sell or transport a counterfeit, fictitious,
altered, forged, lost, stolen, or fraudulently ob­
tained debit instrument knowing the same to be
counterfeit, fictitious, altered, forged, lost, stolen,
or fraudulently obtained; or
(4) knowingly receives, conceals, uses, or trans­
ports money, goods, services, or anything else of
value (except tickets for interstate or foreign
transportation) which (A) within any one-year
period has a value aggregating $1,000 or more,
(B) has moved in or is part of, or which consti­
tutes interstate or foreign commerce and (C) has
been obtained with a counterfeit, fictitious, altered,
forged, lost, stolen, or fraudulently obtained debit
instrument; or
(5) knowingly receives, conceals, uses, sells,
or transports in interstate or foreign commerce
one or more tickets for interstate or foreign trans­
portation, which (A) within any one-year period
have a value aggregating $500 or more, and (B)
have been purchased or obtained with one or
more counterfeit, fictitious, altered, forged, lost,
stolen, or fraudulently obtained debit instrument;
or
(6) in a transaction affecting interstate or for­
eign commerce, furnishes money, property, serv­
ices, or anything else of value, which within any
one-year period has a value aggregating $1,000
or more, through the use of any counterfeit, fic­
titious, altered, forged, lost, stolen, or fraudulently
obtained debit instrument knowing the same to
be counterfeit, fictitious, altered, forged, lost,
stolen, or fraudulently obtained—
shall be fined not more than $10,000 or impris­
oned not more than ten years, or both.
(c)
As used in this section, the term “debit in­
strument” means a card, code, or other device,
other than a check, draft, or similar paper in­

REGULATION E

S T A T U T O R Y APPENDIX

strument, by the use of which a person may ini­
tiate an electronic fund transfer.

§ 917. Administrative enforcement
(a) Compliance with the requirements imposed
under this title shall be enforced under—
(1) section 8 of the Federal Deposit Insurance
Act, in the case of—
(A) national banks, by the Comptroller of the
Currency;
(B) member banks of the Federal Reserve
System (other than national banks), by the Board;
(C) banks insured by the Federal Deposit In­
surance Corporation (other than members of the
Federal Reserve System), by the Board of Direc­
tors of the Federal Deposit Insurance Corpora­
tion;
(2) section 5(d) of the Home Owners’ Loan
Act of 1933, section 407 of the National Hous­
ing Act, and sections 6(i) and 17 of the Federal
Home Loan Bank Act, by the Federal Home
Loan Bank Board (acting directly or through the
Federal Savings and Loan Insurance Corporation),
in the case of any institution subject to any of
those provisions;
(3) the Federal Credit Union Act, by the Ad­
ministrator of the National Credit Union Admin­
istration with respect to any Federal credit union.
(4) the Federal Aviation Act of 1958, by the
Civil Aeronautics Board, with respect to any air
carrier or foreign air carrier subject to that Act;
and
(5) the Securities Exchange Act of 1934, by
the Securities and Exchange Commission, with
respect to any broker or dealer subject to that
Act.
(b) For the purpose of the exercise by any
agency referred to in subsection (a) of its powers
under any Act referred to in that subsection, a
violation of any requirement imposed under this
title shall be deemed to be a violation of a re­
quirement imposed under that Act. In addition
to its powers under any provision of law specifi­
cally referred to in subsection (a), each of the
agencies referred to in that subsection may exer­
cise, for the purpose of enforcing compliance
with any requirement imposed under this title,
any other authority conferred on it by law.
(c) Except to the extent that enforcement of
the requirements imposed under this title is spe­

cifically committed to some other Government
agency under subsection (a), the Federal Trade
Commission shall enforce such requirements. For
the purpose of the exercise by the Federal Trade
Commission of its functions and powers under
the Federal Trade Commission Act, a violation
of any requirement imposed under this title shall
be deemed a violation of a requirement imposed
under that Act. All of the functions and powers
of the Federal Trade Commission under the Fed­
eral Trade Commission Act are available to the
Commission to enforce compliance by any per­
son subject to the jurisdiction of the Commission
with the requirements imposed under this title,
irrespective of whether that person is engaged
in commerce or meets any other jurisdictional
tests in the Federal Trade Commission Act.

§ 918. Reports to Congress
(a) Not later than twelve months after the
effective date of this title and at one-year intervals
thereafter, the Board and the Attorney General
shall, respectively, make reports to the Congress
concerning the administration of their functions
under this title, including such recommendations
as the Board and the Attorney General respec­
tively, deem necessary or appropriate. In addi­
tion, each report of the Board shall include its
assessment of the extent to which compliance
with this title is being achieved, and a summary
of the enforcement actions taken under section
917 of this title. In such report, the Board shall
particularly address the effects of this title on the
costs and benefits to financial institutions and
consumers, on competition, on the introduction of
new technology, on the operations of financial
institutions, and on the adequacy of consumer
protection. The report of the Attorney General
shall also contain an analysis of the impact of
this title on the operation, workload, and effi­
ciency of the Federal courts.
(b) In the exercise of its functions under this
title, the Board may obtain upon request the
views of any other Federal agency which, in the
judgment of the Board, exercises regulatory or
supervisory functions with respect to any class of
persons subject to this title.

§ 919. Relation to State laws
This title does not annul, alter, or affect the
laws of any State relating to electronic fund trans-

S T A T U T O R Y APPENDIX

REGULATION E

der §§ 915 and 916 of the Act to the extent that
the clauses accurately reflect the institutions’ elec­
tronic fund transfer services.
Financial institutions need not use any of the
provided clauses, but may use clauses of their own
design in conjunction with the model clauses. The
inapplicable portions of words or phrases in
parentheses should be deleted. Financial institu­
tions may make alterations, substitutions or addi­
tions in the clauses in order to reflect the services
offered, such as technical changes (e.g., substitu­
tion of a trade name for the word “card,” deletion
of inapplicable services), or substitution of lesser
liability limits in § A(2).

fers, except to the extent that those laws are in­
consistent with the provisions of this title, and
then only to the extent of the inconsistency. A
State law is not inconsistent with this title if the
protection such law affords any consumer is
greater than the protection afforded by this title.
The Board shall, upon its own motion or upon
the request of any financial institution, State, or
other interested party, submitted in accordance
with procedures prescribed in regulations of the
Board, determine whether a State requirement is
inconsistent or affords greater protection. If the
Board determines that a State requirement is
inconsistent, financial institutions shall incur no
liability under the law of that State for a good
faith failure to comply with that law, notwith­
standing that such determination is subsequently
amended, rescinded, or determined by judicial or
other authority to be invalid for any reason. This
title does not extend the applicability of any such
law to any class of persons or transactions to
which it would not otherwise apply.

SECTION A(l>—DISCLOSURE THAT ACCESS
DEVICE IS NOT VALIDATED AND HOW
TO DISPOSE OF DEVICE IF VALIDATION
IS NOT DESIRED (g 205.4(b)(3))
(a) Accounts using cards. YOU CANNOT USE
TH E ENCLOSED CARD TO TRANSFER
MONEY INTO OR OUT OF YOUR ACCOUNT
UNTIL W E HAVE VALIDATED IT. IF YOU
DO NOT WANT TO USE TH E CARD, PLEASE
(destroy it at once by cutting it in half).

§ 920. Exemption for State regulation
The Board shall by regulation exempt from the
requirements of this title any class of electronic
fund transfers within any State if the Board de­
termines that under the law of that State that class
of electronic fund transfers is subject to require­
ments substantially similar to those imposed by
this title, and that there is adequate provision for
enforcement.

[Financial institution may add validation in­
structions here.]
(b) Accounts using codes. YOU CANNOT USE
THE ENCLOSED CODE TO TRANSFER
MONEY INTO OR OUT OF YO UR ACCOUNT
UN TIL W E HAVE VALIDATED IT. IF YOU
DO NOT WANT TO USE TH E CODE, PLEASE
(destroy this notice at once).

§ 921. Effective date
This title takes effect upon the expiration of
eighteen months from the date of its enactment,
except that sections 909 and 911 take effect upon
the expiration of ninety days after the date of
enactment.

[Financial institution may add validation in­
structions here.]

SECTION A(2)—DISCLOSURE OF CONSUMER’S
LIABILITY FOR UNAUTHORIZED TRANSFERS
AND OPTIONAL DISCLOSURE OF
ADVISABILITY OF PROMPT
REPORTING (§ 205.4(d)(1))

APPEN D IX A
MODEL DISCLOSURE CLAUSES
This appendix contains model disclosure clauses
for optional use by financial institutions to facili­
tate compliance with the disclosure requirements
of §§ 205.4(a)(3), (b), and (d). Section 915(d)(2) of
the Act provides that use of these clauses in con­
junction with other requirements of the regulation
will protect financial institutions from liability un­

(a) Liability disclosure. (Tell us AT ONCE if
you believe your (card)(code) has been lost or
stolen. Telephoning is the best way of keeping
your possible losses down. You could lose all the
money in your account (plus your maximum over­
draft line of credit). If you tell us within 2 busi­
15

REGULATION E

S T A T U T O R Y APPENDIX

ness days, you can lose no more than $50 if
someone used your (card) (code) without your
permission.) (If you believe your (card)(code) has
been lost or stolen, and you tell us within 2
business days after you learn of the loss or theft,
you can lose no more than $50 if someone used
your (card)(code) without your permission.)
If you do NOT tell us within 2 business days
after you learn of the loss or theft of your (card)
(code), and we can prove we could have stopped
someone from using your (card)(code) without
your permission if you had told us, you could lose
as much as $500.
Also, if your statement shows transfers that you
did not make, tell us at once. If you do not tell
us within 60 days after the statement was mailed
to you, you may not get back any money you lost
after the 60 days if we can prove that we could
have stopped someone from taking the money if
you had told us in time.
If a good reason (such as a long trip or a hos­
pital stay) kept you from telling us, we will extend
the time periods.

SECTION A(3)—DISCLOSURE OF TELEPHONE
NUMBER AND ADDRESS TO BE NOTIFIED
IN EVENT OF UNAUTHORIZED
TRANSFER (§ 205.4(d)(2))
(a) Address and telephone number. If you be­
lieve your (card)(code) has been lost or stolen or
that someone has transferred or may transfer
money from your account without your permis­
sion, call:
[Telephone number]
or write:
[Name of person or office to be notified]
[Address]

SECTION A(4)—DISCLOSURE OF WHAT
CONSTITUTES BUSINESS DAY OF
INSTITUTION (§ 205.4(d)(3))
(a)
Business day disclosure. Our business days
are (Monday through Friday) (Monday through
Saturday) (any day including Saturdays and Sun­
days). Holidays are (not) included.

S E C T IO N A(5)— D ISC L O SU R E O F T Y P E S O F
A V A IL A B L E T R A N S F E R S A N D L IM IT S ON
T R A N S F E R S (§ 205.4(d)(4))

(a) Account access. You may use your (card)
(code) to
(1) Withdraw cash from your (checking)
(or)(savings) account.
(2) Make deposits to your (checking)(or)

(savings) account.
(3) Transfer funds between your checking
and savings accounts whenever you re­
quest.
(4) Pay for purchases at places that have
agreed to accept the (card)(code).
(5) Pay bills directly (by telephone) from
your (checking)(or)(savings) account in
the amounts and on the days you re­
quest.
Some of these services may not be available
at all terminals.
(b) Limitations on frequency of transfers.
(1) You may make only [insert number, e.g.,
3] cash withdrawals from our terminals each
[insert time period, e.g., week].
(2) You can use your telephone bill-payment
service to pay [insert number] bills each [insert
time period] (telephone call).
(3) You can use our point-of-sale transfer
service for [insert number] transactions each [in­
sert time period].

(4) For security reasons, there are (other)
limits on the number of transfers you can make
using our (terminals)(telephone bill-payment service)(point-of-sale transfer service).
(c) Limitations on dollar amounts of transfers.
(1) You may withdraw up to [insert dollar
amount] from our terminals each ([insert time
period])(time you use the (card) (code)).
(2) You may buy up to [insert dollar amount]
worth of goods or services each ([insert time period])(time you use the (card) (code)) in our pointof-sale transfer service.
SE C T IO N A(6)— D ISC L O S U R E O F C H A R G E S
F O R T R A N S F E R S O R R IG H T TO M A K E
T R A N S F E R S (§ 205.4(d)(5))

(a)
Per transfer charge. We will charge you
[insert dollar amount] for each transfer you make

REGULATION E

S T A T U T O R Y APPENDIX

using our (automated teller machines) (telephone
bill-payment service) (point-of-sale transfer ser­
vice).

SECTION A(7>—DISCLOSURE OF ACCOUNT
INFORMATION TO THIRD PARTIES
(§ 205.4(d)(6))

(b) Fixed charge. We will charge you [insert
dollar amount] each [insert time period] for our
(automated teller machine service) (telephone billpayment service) (point-of-sale transfer service).

(a) Account information disclosure. We will
disclose information to third parties about your
account or the transfers you make:
(1) where it is necessary for completing
transfers.
or
(2) in order to verify the existence and con­
dition of your account for a third party,
such as a credit bureau or merchant.
or
(3) in order to comply with government
agency or court orders.
or
(4) if you give us your written permission.

(c) Average or minimum balance charge. We
will only charge you for using our (automated
teller machines) (telephone bill-payment service)
(point-of-sale transfer service) if the (average)
(minimum) balance in your (checking account)
(savings account) (accounts) falls below [insert dol­
lar amount]. If it does, we will charge you [insert
dollar amount] each (transfer) ([insert time pe­
riod]).

17

REGULATION E

S T A T U T O R Y APPENDIX

APPENDIX B

FEDERAL ENFORCEMENT AGENCIES
The following list indicates which Federal agency enforces Regulation E for particular classes of insti­
tutions. Any questions concerning compliance by a particular institution should be directed to the
appropriate enforcing agency.

National Banks
Comptroller of the Currency
Office of Customer and Community Programs
Washington, D.C. 20219

State Member Banks
Federal Reserve Bank serving the district in which the State member bank is located.

Nonmember Insured Banks
Federal Deposit Insurance Corporation Regional Director for the region in which the nonmember
insured bank is located.

Savings Institutions Insured by the FSLIC and Members of the FHLB System
(except for Savings Banks insured by FDIC)
The Federal Home Loan Bank Board Supervisory Agent in the district in which the institution is
located.

Federal Credit Unions
Division of Consumer Affairs
National Credit Union Administration
2025 M Street, N.W.
Washington, D.C, 20456

Creditors Subject to Civil Aeronautics Board
Director
Bureau of Consumer Protection
Civil Aeronautics Board
Washington, D.C. 20428

Brokers and Dealers
Division of Market Regulations
Securities and Exchange Commission
Washington, D.C. 20549

Retail, Department Stores, Consumer Finance Companies, All Non-Federally Insured Financial Institu­
tions, and All Nonbank Debit Card Issuers
Federal Trade Commission
Electronic Fund Transfers
Washington, D.C. 20580


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102