Full text of Federal Reserve Bank of New York Circulars : Regulation E, Electronic Fund Transfers

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

January 15, 1985

To the Addressee:

Enclosed is a copy of the Board’s revised Regulation E pamphlet, amended
effective April 16, 1985, entitled "Electronic Fund Transfers.”

The pamphlet has

been printed in the new smaller size and replaces the previous printings of that
regulation, together with all amendments thereto.

The revised pamphlet includes

the October 16, and November 16, 1984 amendments to that regulation referred to in
our Circular No. 9743, dated October 18, 1984.

Financial institutions, as indi­

cated in that circular, have until April 16, 1985 to comply with certain require­
ments included in those amendments.




Additional copies of the pamphlet are available on request.

Circulars Division
FEDERAL RESERVE BANK OF NEW YORK

Board of Governors of the Federal Reserve System

Regulation E
Electronic Fund Transfers
12 CFR 205; as amended effective April 16, 1985




Any inquiry relating to this regulation should be addressed to the Federal Reserve Bank of the
District in which the inquiry arises.
December 1984



Contents

Page

Section 205.1—Authority, purpose, and
scope ......................................................
(a) Authority ......................................
(b) Purpose and sc o p e ........................
Section 205.2—Definitions and rules of
construction............................................
Section 205.3—Exemptions......................
(a) Check guarantee or authorization
services .........................
(b) Wire transfers................................
(c) Certain securities or commodities
transfers..........................................
(d) Certain automatic transfers..........
(e) Certain telephone-initiated
transfers..........................................
(f) Trust a cco u n ts..............................
(g) Preauthorized transfers to small
financial institutions......................
Section 205.4— Special requirements........
(a) Services offered by two or more
financial institutions......................
(b) Multiple accounts and account
holders............................................
(c) Additional information;
disclosures required by other laws.
Section 205.5—Issuance of access devices.
(a) General r u l e ..................................
(b) Exception ......................................
(c) Relation to truth in lending..........
Section 205.6—Liability of consumer for
unauthorized transfers..........................
(a) General r u l e ..................................
(b) Limitations on amount of liability.
(c) Notice to financial institution . . . .
(d) Relation to truth in lending..........
Section 205.7—Initial disclosure of terms
and conditions........................................
(a) Content of disclosures..................
(b) Timing of disclosures for accounts
in existence on May 10, 1980........
Section 205.8—Change in terms; errorresolution n o tic e ....................................
(a) Change in te rm s ............................
(b) Error-resolution notice..................



1
1
1
1
2
2
2
2
2
3
3
3
3
3
3
3
3
3
3
4
4
4
4
5
5
5
5
6
6
6
7

Page

Section 205.9—Documentation of
transfers..................................................
(a) Receipts at electronic terminals. . .
(b) Periodic statements ......................
(c) Documentation of certain
passbook acco u n ts........................
(d) Periodic statements for certain
nonpassbook accounts..................
(e) Use of abbreviations......................
(f) Receipt requirements for certain
cash-dispensing terminals ............
(g) Delayed effective date for certain
periodic-statement requirements ..
(h) Periodic statements for certain
intra-institutional tran sfers..........
(i) Documentation for foreigninitiated transfers..........................
Section 205.10—Preauthorized transfers .
(a) Preauthorized transfers to a
consumer’s a c c o u n t......................
(b) Preauthorized transfers from a
consumer’s account; written
authorization..................................
(c) Consumer’s right to stop payment
(d) Notice of transfers varying in
amount ..........................................
Section 205.11—Procedures for resolving
e rro rs........................................................
(a) Definition of error..........................
(b) Notice of error from consumer . . .
(c) Investigation of e r r o r s ..................
(d) Extent of required investigation ..
(e) Procedures after financial
institution determines that error
occurred ........................................
(f) Procedures after financial
institution determines that no
error occurred................................
(g) Withdrawal of notice of error . . . .
(h) Reassertion of e r r o r ......................
(i) Relation to truth in lending..........
Section 205.12—Relation to state law . . . .
(a) Preemption of inconsistent state
la w s................................................
(b) Standards for preemption ............
(c) Procedures for preemption ..........

7
7
8
8
9
9
9
9
9
9
9
9

10
10
10
10
10
10
10
10

10

10
13
13
13
13
13
13
13

i

Contents
Page

(d)

Exemption for state-regulated
transfers..........................................
Section 205.13—Administrative
enforcement............................................
(a) Enforcement by federal agencies ..
(b) Issuance of staff interpretations . . .
(c) Record retention............................
Section 205.14— Services offered by
financial institutions not holding
consumer’s account................................

n



13
14
14
14
14

15

Page

(a) Compliance by service-providing
institution......................................
(b) Compliance by account-holding
institution......................................
(c) Definition of agreem ent................
Appendix A—Model disclosure clauses ..
Appendix B—Federal enforcement
agencies..................................................

15

15
16
19

Electronic Fund Transfer A c t .................. 21

Regulation E
Electronic Fund Transfers
12 CFR 205; effective March 30, 1979; as amended effective April 16, 1985

SECTION 205.1—Authority, Purpose,
and Scope
(a) Authority. This regulation, issued by the
Board of Governors of the Federal Reserve
System, implements title IX (Electronic
Fund Transfer Act) of the Consumer Credit
Protection Act, as amended (15 USC 1601 et
seq.). Information-collection requirements
contained in this regulation have been ap­
proved by the Office of Management and Bud­
get under the provisions of 44 USC 3501 et
seq. and have been assigned OMB No. 71000200.
(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 characteris­
tics of these systems make the application of
existing consumer protection laws unclear,
leaving the rights and liabilities of users of
electronic fund transfer systems undefined.
The act establishes the basic rights, liabilities,
and responsibilities of consumers who use
electronic money transfer services and of fi­
nancial institutions that offer these services.
This regulation is intended to carry out the
purposes of the act, including, primarily, the
protection of individual consumers engaging
in electronic transfers. Except as otherwise
provided, this regulation applies to all persons
who are financial institutions as defined in sec­
tion 205.2(i).

SECTION 205.2—Definitions and Rules
of Construction
For the purposes of this regulation, the fol­
lowing definitions and rules of construction
apply, unless the context indicates 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 pur­
pose of initiating electronic fund transfers;
(2) An access device becomes an “accepted
access device ” when the consumer to whom
the access device was issued;
(i) Requests and receives, or signs, or
uses, or authorizes another to use, the ac­
cess device for the purpose of transferring
money between accounts or obtaining
money, property, labor, or services;
(ii) Requests validation of an access de­
vice issued on an unsolicited basis; or
(iii) Receives an access device issued in
renewal of, or in substitution for, an ac­
cepted access device, whether such access
device is issued by the initial financial in­
stitution or a successor.
(b) “Account” means a demand deposit
(checking), savings, or other consumer asset
account (other than an occasional or inciden­
tal credit balance in a credit plan) held either
directly or indirectly by a financial institution
and established primarily for personal, family,
or household purposes.
(c) "Act” means the Electronic Fund Trans­
fer Act (title IX of the Consumer Credit Pro­
tection Act, 15 USC 1601 et seq.).
(d) “Business day ” means any day on which
the offices of the consumer’s financial institu­
tion 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 fi­
nancial institution to a consumer to defer pay­
ment of debt, incur debt and defer its pay­
ment, or purchase property or services and
defer payment therefor.
(g) “Electronic fu n d transfer” means any
transfer of funds, other than a transaction
originated by check, draft, or similar paper
instrument, that is initiated through an elec­
tronic terminal, telephone, or computer or
1

§ 205.2
magnetic tape for the purpose of ordering, in­
structing, or authorizing a financial institution
to debit or credit an account. The term in­
cludes, but is not limited to, point-of-sale
transfers, automated teller machine transfers,
direct deposits or withdrawals of funds, and
transfers initiated by telephone. It includes all
transfers resulting from debit card transac­
tions, including those that do not involve an
electronic terminal at the time of the transac­
tion. The term does not include payments
made by check, draft, or similar paper instru­
ment at an electronic terminal.
(h) “Electronic terminal” means an electron­
ic device, other than a telephone operated by a
consumer, 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
national bank, a state or federal savings and
loan association, a state or federal mutual sav­
ings 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.

Regulation E
rized, (2) initiated with fraudulent intent by
the consumer or any person acting in concert
with the consumer, or (3) that is initiated by
the financial institution or its employee.
(m) Footnotes have the same legal effect as
the text of the regulation.

SE C T IO N 205.3— Exem ptions
The act and this regulation do not apply to
the following:
(a) Check guarantee or authorization services.
Any service that guarantees payment or au­
thorizes acceptance of a check, draft, or simi­
lar paper instrument and that does not direct­
ly 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 Re­
serve Communications System or other simi­
lar network that is used primarily for transfers
between financial institutions or between
businesses.

(c) Certain securities or commodities trans­
fers. Any transfer the primary purpose of
which is the purchase or sale of securities or
commodities regulated by the Securities and
Exchange Commission or the Commodity Fu­
(j) ‘‘Preauthorized electronic fu n d transfer”
''
tures Trading Commission.
means an electronic fund transfer authorized
in advance to recur at substantially regular (d) Certain automatic transfers. Any transfer
intervals.
under an agreement between a consumer and
a financial institution which provides that the
(k) “State” means any state, territory, or
institution will initiate individual transfers
possession of the United States, the District of
without a specific request from the consumer:
Columbia, the Commonwealth of Puerto
(1) Between a consumer’s accounts within
Rico, or any political subdivision of any of the
the financial institution, such as a transfer
above.
from a checking account to a savings
account;
(/) “Unauthorized electronic fu n d transfer”
(2) Into a consumer’s account by the fi­
means an electronic fund transfer from a con­
nancial institution, such as the crediting of
sumer’s account initiated by a person other
interest to a savings account;1
3
than the consumer without actual authority to
(3) From a consumer’s account to an
initiate the transfer and from which the con­
sumer receives no benefit. The term does not
la The financial institution remains subject to section 913
include any electronic fund transfer (1) initia­
of the act regarding compulsory use of electronic fund
ted by a person who was furnished with the transfers. A financial institution may, however, require the
access device to the consumer’s account by automatic repayment of credit that is extended under an
the consumer, unless the consumer has noti­ overdraft credit plan or that is extended to maintain a spec­
ified minimum balance in the consumer’s account. Finan­
fied the financial institution involved that cial institutions also remain subject to sections 915 and 916
transfers by that person are no longer autho- regarding civil and criminal liability.
2




Regulation E
account of the financial institution, such as
a loan payment;1 or
3
(4) From a consumer’s account to an ac­
count of another consumer, within the fi­
nancial institution, who is a member of the
transferor’s family.
(e) Certain telephone-initiated transfers. Any
transfer of funds that (1) is initiated by a tele­
phone conversation between a consumer and
an officer or employee of a financial institution
and (2) is not under a telephone bill-payment
or other prearranged 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
agreement.
(g) Preauthorized transfers to small financial
institutions. (1) Any preauthorized transfer to
or from an account if the assets of the ac­
count-holding financial institution are $25
million or less on December 31. la
(2) If the account-holding financial institu­
tion’s assets subsequently exceed $25 mil­
lion, the institution’s exemption for this
class of transfers shall terminate one year
from the end of the calendar year in which
the assets exceed $25 million.

SECTION 205.4—Special Requirements
(a) Services offered by two or more financial
institutions. Two or more financial institutions
that jointly provide electronic fund transfer
services may contract among themselves to
comply with the requirements that this regu­
lation imposes on any or all of them. When
making disclosures under sections 205.7 and
205.8, a financial institution that provides
electronic fund transfer services under an
agreement with other financial institutions
need make only those disclosures which are
within its knowledge and the purview of its
relationship with the consumer for whom it
holds an account.
la The financial institution remains subject to section 913
of the act regarding compulsory use of electronic fund
transfers. A financial institution may, however, require the
automatic repayment of credit that is extended under an
overdraft credit plan or that is extended to maintain a spec­
ified minimum balance in the consumer’s account. Finan­
cial institutions also remain subject to sections 915 and 916
regarding civil and criminal liability.




§ 205.5
(b) Multiple accounts and account holders.
(1) If a consumer holds two or more ac­
counts at a financial institution, the institu­
tion may combine the disclosures required
by the regulation into one statement (for
example, the financial institution may mail
or deliver a single periodic statement or an­
nual error resolution notice to a consumer
for multiple accounts held by that consum­
er at that institution).
(2) If two or more consumers hold a joint
account from or to which electronic fund
transfers can be made, the financial institu­
tion need provide only one set of the disclo­
sures required by the regulation for each
account.
(c) Additional information; disclosures re­
quired by other laws. At the financial institu­
tion’s option, additional information or disclo­
sures required by other laws (for example,
Truth in Lending disclosures) may be com­
bined with the disclosures required by this
regulation.

SECTION 205.5—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 re­
quest or application for the device;15 or
1
(2) A sa renewal of, or in substitution for,
an accepted access device, whether issued
by the initial 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 renewed or substituted under
paragraph (a)(2) of this section), provided
that the disclosures set forth in sections
205.7(a)(1), (2), and (3) accompany 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 provi­
sions of paragraph (a)(1) of this section, a
15 In the case of a joint account, a financial institution
1
may issue an access device to each account holder for
whom the requesting holder specifically requests an access
device.

3

§ 205.5
financial institution may distribute an access
device to a consumer on an unsolicited basis if:
(1) The access device is not validated;
(2) The distribution is accompanied by a
complete disclosure, in accordance with
section 205.7(a), of the consumer’s rights
and liabilities that will apply if the access
device is validated;
(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
response to the consumer’s oral or written
request or application for validation and af­
ter verification of the consumer’s identity
by any reasonable means, such as by photo­
graph, fingerprint, personal visit, or signa­
ture comparison.
An access device is considered validated
when a financial institution has performed all
procedures necessary to enable a consumer to
use it to initiate 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 defined in 12 CFR 226.12(a) (2), foot­
note 21 (Regulation Z), of the capability
to initiate electronic fund transfers; and
(iii) Issuance of access devices that per­
mit credit extensions only under a preex­
isting agreement between a consumer and
a financial institution to extend the credit
when the consumer’s account is over­
drawn or to maintain a specified mini­
mum balance in the consumer’s account.
(2) The Truth in Lending Act (15 USC
1601 et seq.) and 12 CFR Part 226 (Regu­
lation Z), which prohibit the unsolicited is­
suance of credit cards, govern
(i) Issuance of credit cards as defined in
12 CFR 226.2(a)(15);
(ii) Addition of a credit feature to an ac­
cepted access device; and
(iii) Issuance of credit cards that are
also access devices, except as provided in
paragraph (c)(1) (iii) of this section.
4



Regulation E
SE C T IO N 205.6— Liability of C onsum er
for U nauthorized Transfers
(a) General rule. A consumer is liable, within
the limitations described in paragraph (b) of
this section, for unauthorized electronic fund
transfers involving the consumer’s account
only if:
(1) The access device used for the unau­
thorized transfers is an accepted access
device;
(2) The financial institution has provided a
means (such as by signature, photograph,
fingerprint, or electronic or mechanical
confirmation) to identify the consumer to
whom the access device was issued; and
(3) The financial institution has provided
the following information, in writing, to the
consumer:
(i) A summary of the consumer’s liabili­
ty under this section, or under other ap­
plicable law or agreement, for unautho­
rized electronic fund transfers and, at the
financial institution’s option, notice of
the advisability of promptly reporting
loss or theft of the access device or unau­
thorized transfers.
(ii) The telephone number and address
of the person or office to be notified in the
event the consumer believes that an un­
authorized electronic fund transfer has
been or may be made.
(iii) The financial institution’s business
days, as determined under section 205.2
(d), unless applicable state law or an
agreement between the consumer and the
financial institution sets a liability limit
not greater than $50.
(b) Limitations on amount o f liability. The
amount of a consumer’s liability for an unau­
thorized electronic fund transfer or a series of
related unauthorized transfers shall not ex­
ceed $50 or the amount of unauthorized
transfers that occur before notice to the finan­
cial institution under paragraph (c) of this
section, whichever is less, unless one or both
of the following exceptions apply:
(1) If the consumer fails to notify the fi­
nancial institution within two business days
after learning of the loss or theft of the ac­
cess device, the consumer’s liability shall
not exceed the lesser of $500 or the sum of

Regulation E
(i) $50 or the amount of unauthorized
electronic fund transfers that occur be­
fore the close of the two business days,
whichever is less, and
(ii) The amount of unauthorized elec­
tronic fund transfers that the financial in­
stitution establishes would not have oc­
curred but for the failure of the consumer
to notify the institution within two busi­
ness days after the consumer learns of the
loss or theft of the access device, and
that occur after the close of two busi­
ness days and before notice to the finan­
cial institution.
(2) If the consumer fails to report within
60 days of transmittal of the periodic state­
ment any unauthorized electronic fund
transfer that appears on the statement, the
consumer’s liability shall not exceed the
sum of
(i) The lesser of $50 or the amount of
unauthorized electronic fund transfers
that appear on the periodic statement or
that occur during the 60-day period, and
(ii) The amount of unauthorized elec­
tronic fund transfers that occur after the
close of the 60 days and before notice to
the financial institution and that the fi­
nancial institution establishes would not
have occurred but for the failure of the
consumer to notify the financial institu­
tion within that time.
(3) Paragraphs (b)(1) and (2) of this sec­
tion may both apply in some circumstances.
Paragraph (b)(1) shall determine the con­
sumer’s liability for any unauthorized
transfers that appear on the periodic state­
ment and occur before the close of the 60day period, and paragraph (b) (2) (ii) shall
determine liability for transfers that occur
after the close of the 60-day period.
(4) If a delay in notifying the financial in­
stitution was due to extenuating circum­
stances, such as extended travel or hospital­
ization, the time periods specified above
shall be extended to a reasonable time.
(5) If applicable state law or an agreement
between the consumer and financial institu­
tion imposes lesser liability than that pro­
vided in paragraph (b) of this section, the
consumer’s liability shall not exceed that
imposed under that law or agreement.



§ 205.7
(c) Notice to financial institution. For pur­
poses of this section, notice to a financial insti­
tution is given when a consumer takes such
steps as are reasonably necessary to provide
the financial institution with the pertinent
information, whether or not any particular of­
ficer, employee, or agent of the financial insti­
tution does in fact receive the information.
Notice may be given to the financial institu­
tion, at the consumer’s option, in person, by
telephone, or in writing. Notice in writing is
considered given at the time the consumer de­
posits the notice in the mail or delivers the
notice for transmission by any other usual
means to the financial institution. Notice is
also considered given when the financial insti­
tution becomes aware of circumstances that
lead to the reasonable belief that an unautho­
rized 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 elec­
tronic fund transfer shall be determined
solely in accordance with this section if the
electronic fund transfer
(i) Was initiated by use of an access de­
vice that is also a credit card as defined in
12 CFR 226.2(a) (15), or
(ii) Involves an extension of credit un­
der an agreement between 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) A consumer’s liability for unautho­
rized 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 CFR 226 (Regula­
tion Z).

SECTION 205.7—Initial Disclosure of
Terms and Conditions
(a) Content o f disclosures. At the time a con­
sumer contracts for an electronic fund trans­
fer service or before the first electronic fund
transfer is made involving a consumer’s ac­
count, a financial institution shall disclose to
5

§ 205.7
the consumer, in a readily understandable
written statement that the consumer may re­
tain, the following terms and conditions of the
electronic fund transfer service, as applicable:
(1) A summary of the consumer’s liability
under section 205.6, or other applicable law
or agreement, for unauthorized electronic
fund transfers and, at the financial institu­
tion’s option, the advisability of promptly
reporting loss or theft of the access device
or unauthorized transfers.
(2) The telephone number and address of
the person or office to be notified when 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 section 205.2(d).
(4) The type of electronic fund transfers
that the consumer may make and any limi­
tations on the frequency and dollar amount
of transfers. The details of the limitations
need not be disclosed if their confidentiality
is essential to maintain the security of the
electronic fund transfer system.
(5) Any charges for electronic fund trans­
fers or for the right to make transfers.
(6) A summary of the consumer’s right to
receive documentation of electronic fund
transfers, as provided in sections 205.9,
205.10(a), and 205.10(d).
(7) A summary of the consumer’s right to
stop payment of a preauthorized electronic
fund transfer and the procedure for initiat­
ing a stop-payment order, as provided in
section 205.10(c).
(8) A summary of the financial institu­
tion’s liability to the consumer for its failure
to make or to stop certain transfers under
section 910 of the act.
(9) The circumstances under which the fi­
nancial institution in the ordinary course of
business will disclose information to third
parties concerning the consumer’s account.
(10) A notice that is substantially similar
to the following notice concerning error res­
olution procedures and the consumer’s
rights under them:
In Case o f Errors or Questions About Your
Electronic Transfers
Telephone us at [insert telephone number]
or

6



Regulation E
Write us at [insert address]
as soon as you can, if you think your statement
or receipt is wrong or if you need more informa­
tion about a transfer listed on the statement or
receipt. We must hear from you no later than 60
days after we sent the FIRST statement on which
the problem or error appeared.
(1) Tell us your name and account number
(if any).
(2) Describe the error or the transfer you are
unsure about, and explain as clearly as you can
why you believe it is an error or why you need
more information.
(3) Tell us the dollar amount of the suspected
error.
If you tell us orally, we may require that you
send us your complaint or question in writing
within 10 business days.
We will tell you the results of our investigation
within 10 business days after we hear from you
and will correct any error promptly. If we need
more time, however, we may take up to 45 days
to investigate your complaint or question. If we
decide to do this, we will recredit 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. If we ask you to put your com­
plaint or question in writing and we do not recieve it within 10 business days, we may not re­
credit your account.
If we decide that there was no error, we will
send you a written explanation within three busi­
ness days after we finish our investigation. You
may ask for copies of the documents that we used
in our investigation.

(b) Timing o f disclosures for accounts in exis­
tence on May 10, 1980. A financial institution
shall mail or deliver to the consumer the in­
formation required by paragraph (a) of this
section on or before June 9, 1980, or with the
first periodic statement required by section
205.9(b) after May 10, 1980, whichever is
earlier, for any account that is open on May
10, 1980, and
(1) From or to which electronic fund
transfers were made prior to May 10, 1980;
(2) With respect to which a contract for
such transfers was entered into between a
consumer and a financial institution; or
(3) For which an access device was issued
to a consumer.

SECTION 205.8—Change in Terms;
Error-Resolution Notice
(a) Change in terms. A financial institution

Regulation E
shall mail or deliver a written notice to the
consumer at least 21 days before the effective
date of any change in a term or condition re­
quired to be disclosed under section 205.7(a)
if the change would result in increased fees or
charges, increased liability for the consumer,
fewer types of available electronic fund trans­
fers, or stricter limitations on the frequency or
dollar amounts of transfers. Prior notice need
not be given where an immediate change in
terms or conditions is necessary to maintain
or restore the security of an electronic fund
transfer system or account. However, if such a
change is to be made permanent, the financial
institution shall provide written notice of the
change to the consumer on or with the next
regularly scheduled periodic statement or
within 30 days, unless disclosure would jeop­
ardize the security of the system or account.

§ 205.9

SECTION 205.9—Documentation of
Transfers

(a) Receipts at electronic terminals. At the
time an electronic fund transfer is initiated at
an electronic terminal by a consumer, the fi­
nancial institution shall make available2 to
the consumer a written receipt of the trans­
fe r^ ) that clearly sets forth the following in­
formation, as applicable:
(1) The amount of the transfer. A charge
for the transfer may be included in this
amount if the terminal is owned or operated
by a person other than the financial institu­
tion holding the consumer’s account, pro­
vided the amount of the charge is disclosed
on the receipt and on a sign posted on or at
the terminal.
(2) The calendar date the consumer initia­
ted the transfer.
(b) Error-resolution notice. For each account
(3) The type of transfer and the type of the
from or to which electronic fund transfers can
consumer’s account(s)3*to or from which
be made, a financial institution shall mail or
funds are transferred, such as “withdrawal
deliver to the consumer, at least once each
from checking,” “transfer from savings to
calendar year, the notice set forth in section
checking,” or “payment from savings.”
205.7(a) (10). Alternatively, a financial insti­
These descriptions may be used for trans­
tution may mail or deliver a notice that is sub­
fers to or from accounts that are similar in
stantially similar to the following notice on or
function to checking accounts (such as
with each periodic statement required by sec­
share draft or negotiable order of withdraw­
tion 205.9(b):
al accounts) or to savings accounts (such
as share accounts). Codes may be used only
In Case o f Errors or Questions About Your
if they are explained elsewhere on the
Electronic Transfers
receipt.
Telephone us at [insert telephone number]
(4) A number or code that uniquely iden­
or
tifies the consumer initiating the transfer,
Write us at [insert address]
the consumer’s account(s), or the access
as soon as you can, if you think your statement or
device used to initiate the transfer.
receipt is wrong or if you need more information
(5) The location (in a form prescribed by
about a transfer on the statement or receipt. We
paragraph (b)(1) (iv) of this section) of
must hear from you no later than 60 days after we
sent you the FIRST statement on which the error or
the terminal at which the transfer was ini­
problem appeared.
tiated or an identification (such as a code or
(1) Tell us your name and account number (if
terminal number).
any).
(6) The name of any third party to or from
(2) Describe the error or the transfer you are
whom funds are transferred; a code may be
unsure about, and explain as clearly as you can why
you believe there is an error or why you need more
used only if it is explained elsewhere on the
information.
(3) Tell us the dollar amount of the suspected
error.
We will investigate your complaint and will cor­
rect any error promptly. If we take more than 10
business days to do this, we will recredit your ac­
count for the amount you think is in error, so that
you will have use of the money during the time it
takes us to complete our investigation.



2 A financial institution may arrange for a third party,
such as a merchant, to make the receipt available.
3 If more than one account of the same type may be
accessed by a single access device, the accounts must be
uniquely identified unless the terminal is incapable of such
identification and was purchased or ordered by the finan­
cial institution prior to February 6, 1980. The type of ac­
count need not be identified if the access device may access
only one account at that terminal.

7

§ 205.9
receipt. This requirement does not apply if
the name is provided by the consumer in a
form that the electronic terminal cannot
duplicate on the receipt.
(b) Periodic statements. For any account to
or from which electronic fund transfers can be
made, the financial institution shall mail or
deliver a statement for each monthly or short­
er cycle in which an electronic fund transfer
has occurred, but at least a quarterly state­
ment if no transfer has occurred. The state­
ment shall include the following, as
applicable:
(1) For each electronic fund transfer oc­
curring during the cycle,4
(i) The amount of the transfer. If a
transfer charge was added at the time of
initiation by the owner or operator of an
electronic terminal in accordance with
paragraph (a)(1 ) of this section, that
charge may be included in the amount of
the transfer.
(ii) The date the transfer was credited
or debited to the consumer’s account.
(iii) The type of transfer and the type of
the consumer’s account(s) to or from
which funds were transferred.
(iv) For each transfer initiated by the
consumer at an electronic terminal,43 the
location that appeared on the receipt or,
if an identification (such as a code or ter­
minal number) was used, that identifica­
tion and one of the following descriptions
of the terminal’s location:
(A) The address, including number
and street (the number may be omit­
ted if the street alone uniquely identi­
fies the terminal location) or intersec­
tion, city, and state or foreign
country;5
4 The information required by paragraph (b)(1) of this
section may be provided on accompanying documents.
Codes explained on the statement or on accompanying doc­
uments are acceptable.
4a A financial institution need not identify the terminal
location for deposits of cash, checks, drafts, or similar pa­
per instruments at electronic terminals.
5 The city and state may be omitted if all the terminals
owned or operated by the financial institution providing the
statement (or by the system in which it participates) are
located in the same city. The state may be omitted if all the
terminals owned or operated by the financial institution
providing the statement (or by the system in which it par­
ticipates) are located in that state. The state may also be
omitted for transfers occurring at terminals within 50 miles
of the financial institution’s main office.




Regulation E
(B) A generally accepted name for a
specific location (such as a branch of
the financial institution, a shopping
center, or an airport), city, and state
or foreign country;6 or
(C) The name of the entity at whose
place of business the terminal is locat­
ed or which owns or operates the
terminal (such as the financialinstitution7 or the seller of goods or
services), city, and state or foreign
country.8
(v) The name of any third party to or
from whom funds were transferred.9
(2) The number(s) of the consumer’s ac­
c o u n ts) for which the statement is issued.
(3) The amount of any fees or charges,
other than a finance charge under 12 CFR
226.7(f), assessed against the account dur­
ing the statement period for electronic fund
transfers or the right to make such trans­
fers, or for account maintenance.
(4) The balances in the consumer’s ac­
count (s) at the beginning and at the close
of the statement period.
(5) The address and telephone number to
be used for inquiry or notice of errors, pre­
ceded by “Direct Inquiries To:” or similar
language. Alternatively, the address and
telephone number may be provided on the
notice of error-resolution procedures set
forth in section 205.8(b).
(6) If the financial institution uses the
notice procedure set forth in section
205.10(a)(1 )(iii), the telephone number
the consumer may call to ascertain whether
a preauthorized transfer to the consumer’s
account has occurred.
(c) Documentation for certain passbook ac­
counts. In the case of a consumer’s passbook
account which may not be accessed by any
electronic fund transfers other than preau­
thorized transfers to the account,9a the finan­
6 See footnote 5.
7 If the financial institution providing the statement owns
or operates terminals at more than one location, it shall
describe the location of its electronic terminals by use of
paragraphs (b )(l)(iv )(A ) or (B) of this section.
8 See footnote 5.
9 A financial institution need not identify third parties
whose names appear on checks, drafts, or similar paper
instruments deposited to the consumer’s account at an elec­
tronic terminal.
9a Accounts that also are accessible by the intra-institutional transfers described in paragraph (h) of this section
may continue to be documented in accordance with para­
graph (c) or (d) of this section.

Regulation E
cial institution may, in lieu of complying with
paragraph (b) of this section, upon presenta­
tion of the consumer’s passbook, provide the
consumer with documentation by entering in
the passbook or on a separate document the
amount and date of each electronic fund
transfer made since the passbook was last
presented.
(d) Periodic statements for certain non-passbook accounts. If a consumer’s account other
than a passbook account may not be accessed
by any electronic fund transfers other than
preauthorized transfers to the account,93 the
financial institution need provide the periodic
statement required by paragraph (b) of this
section only quarterly.
(e) Use o f abbreviations. A financial institu­
tion may use commonly accepted or readily
understandable abbreviations in complying
with the documentation requirements of this
section.
(f) Receipt requirements for certain cash-dis­
pensing terminals. The failure of a financial
institution to comply with the requirement of
paragraph (a) of this section that a receipt be
made available to the consumer at the time an
electronic fund transfer is initiated at an elec­
tronic terminal shall not constitute a violation
of the act or this regulation, provided—
(1) The transfer occurs at an electronic
terminal that—
(i) Does not permit transfers other than
cash withdrawals by the consumer,
(ii) Cannot make a receipt available to
the consumer at the time the transfer is
initiated,
1
(iii) Cannot be modified to provide a re­
ceipt at that time, and
(iv) Was purchased or ordered by the fi­
nancial institution prior to February 6,
1980; and
(2) The financial institution mails or deliv­
ers a written receipt to the consumer that
complies with the other requirements of
paragraph (a) of this section on the next
business day following the transfer.
9a Accounts that also are accessible by the intra-institutional transfers described in paragraph (h) of this section
may continue to be documented in accordance with para­
graph (c) or (d) of this section.




§205.10
(g) Delayed effective date for certain periodic
statement requirements. The failure of a finan­
cial institution to describe an electronic fund
transfer in accordance with the requirements
of paragraphs (b)(1) (iv) and (v) of this sec­
tion shall not constitute a violation of the act
or this regulation unless the transfer occurs on
or after August 10, 1980, if, when a transfer
involves a payment to another person, the fi­
nancial institution, upon the consumer’s re­
quest and without charge, promptly provides
the consumer with proof that such a payment
was made.
(h) Periodic statements for certain intra-institutional transfers. A financial institution need
not provide the periodic statement required by
paragraph (b) of this section for an account
accessed only by electronic fund transfers ini­
tiated by the consumer to or from another ac­
count of the consumer for which the financial
institution documents transfers in compliance
with paragraph (b) of this section.
(i) Documentation for foreign-initiated trans­
fers. Failure to provide the terminal receipt
and periodic statement required by para­
graphs (a) and (b) of this section for a partic­
ular electronic fund transfer shall not be
deemed a failure to comply with this regula­
tion, if—
(1) the transfer is not initiated in a state as
defined in section 205.2(k); and
(2) in accordance with section 205.11, the
financial institution treats an inquiry for
clarification or documentation as a notice of
error and corrects the error.

SE C T IO N 205.10— P reauthorized
Transfers
(a) Preauthorized transfers to a consumer's
account. (1) Where a consumer’s account is
scheduled to be credited by a preauthorized
electronic fund transfer from the same pay­
or at least once every 60 days, except where
the payor provides positive notice to the
consumer that the transfer has been initiat­
ed, the financial institution shall provide
notice by one of the following means:
(i) The institution shall transmit oral or
written notice to the consumer, within
9

§205.10
two business days after the transfer, that
the transfer occurred;
(ii) The institution shall transmit oral or
written notice to the consumer, within
two business days after the date on which
the transfer was scheduled to occur, that
the transfer did not occur; or
(iii) The institution shall provide a read­
ily available telephone line that the con­
sumer may call to ascertain whether or
not the transfer occurred, and shall dis­
close the telephone number on the initial
disclosures required by section 205.7 and
on each periodic statement.
(2) A financial institution that receives a
preauthorized transfer of the type described
in paragraph (a)(1 ) of this section shall
credit the amount of the transfer as of the
day the funds for the transfer are received.
(b) Preauthorized transfers from a consum­
er's account; written authorization. Pre­
authorized electronic fund transfers from a
consumer’s account may be authorized by the
consumer only in writing, and a copy of the
authorization shall be provided to the con­
sumer by the party that obtains the authoriza­
tion from the consumer.
(c) Consumer's right to stop payment. A con­
sumer may stop payment of a preauthorized
electronic fund transfer from the consumer’s
account by notifying the financial institution
orally or in writing at any time up to three
business days before the scheduled date of the
transfer. The financial institution may require
written confirmation of the stop-payment or­
der to be made within 14 days of an oral noti­
fication if, when the oral notification is made,
the requirement is disclosed to the consumer
together with the address to which confirma­
tion should be sent. If written confirmation
has been required by the financial institution,
the oral stop-payment order shall cease to be
binding 14 days after it has been made.
(d) Notice o f transfers varying in amount.
Where a preauthorized electronic fund trans­
fer from the consumer’s account varies in
amount from the previous transfer relating to
the same authorization, or the preauthorized
amount, the financial institution or the desig­
nated payee shall mail or deliver, at least 10
days before the scheduled transfer date, a
10



Regulation E
written notice of the amount and scheduled
date of the transfer. If the financial institution
or designated payee informs the consumer of
the right to receive notice of all varying trans­
fers, the consumer may elect to receive notice
only when a transfer does not fall within a
specified range of amounts or, alternatively,
only when a transfer differs from the most re­
cent transfer by more than an agreed-upon
amount.

SE C T IO N 205.11— Procedures for
Resolving E rrors
(a) Definition o f error. For purposes of this
section, the term “error” means:
(1) An unauthorized electronic fund
transfer;
(2) An incorrect electronic fund transfer
to or from the consumer’s account;
(3) The omission from a periodic state­
ment of an electronic fund transfer to or
from the consumer’s account that should
have been included;
(4) A computational or bookkeeping error
made by the financial institution relating to
an electronic fund transfer;
(5) The consumer’s receipt of an incorrect
amount of money from an electronic
terminal;
(6) An electronic fund transfer not identi­
fied in accordance with the requirements of
sections 205.9 or 205.10(a); or
(7) A consumer’s request for any docu­
mentation required by sections 205.9 or
205.10(a), or for additional information or
clarification concerning an electronic fund
transfer. This includes any request for doc­
umentation, information, or clarification in
order to assert an error within the meaning
of paragraphs (a)(1) through (6) of this
section. It does not include a routine in­
quiry about the balance in the consumer’s
account or a request for duplicate copies of
documentation or other information that is
made only for tax or other record-keeping
purposes.
(b) Notice o f error from consumer. (1) A no­
tice of an error is an oral or written notice
from the consumer that—
(i) Is received by the financial

Regulation E
institution10*no later than 60 days after
the institution—
(A) Transmitted a periodic statement
or provided documentation under sec­
tion 205.9(c) on which the alleged er­
ror is first reflected; or
(B) Transmitted additional informa­
tion, clarification, or documentation
described in paragraph (a)(7 ) of this
section that was initially requested in
accordance with paragraph (b) (1) (i)
(A) of this section;
(ii) Enables the financial institution to
identify the consumer’s name and ac­
count number; and
(iii) Except for errors described in para­
graph (a)(7 ) of this section, indicates
the consumer’s belief, and the reasons for
that belief, that an error exists in the con­
sumer’s account or is reflected on docu­
mentation required by sections 205.9 or
205.10(a), and indicates to the extent
possible the type, the date, and the
amount of the error.
(2) A financial institution may require a
written confirmation to be received within
10 business days of an oral notice if, when
the oral notice is given, the consumer is ad­
vised of the requirement and of the address
to which confirmation must be sent.
(c) Investigation o f errors. (1) After receiv­
ing a notice of an error, the financial institu­
tion shall promptly investigate the alleged
error, determine whether an error occurred,
and transmit the results of its investigation
and determination to the consumer within
10 business days.
(2) As an alternative to the 10-businessday requirement of paragraph (c)(1 ) of
this section, the financial institution shall
investigate the alleged error and determine
whether an error occurred, promptly but in
no event later than 45 calendar days after
receiving a notice of an error, and shall
transmit the results of its investigation and
determination to the consumer, provided—
10 A financial institution may require the consumer to
give notice only at the telephone number or address dis­
closed by the institution, provided the institution maintains
reasonable procedures to refer the consumer to the speci­
fied telephone number or address if the consumer attempts
to give notice to the institution in a different manner.




§ 205.11
(i) The financial institution provisional­
ly recredits the consumer’s account in the
amount of the alleged error (including
interest where applicable) within 10 busi­
ness days after receiving the notice of er­
ror. If the financial institution has a
reasonable basis for believing that an un­
authorized electonic fund transfer may
have occurred and that it has satisfied the
requirements of section 205.6(a), it may
withhold a maximum of $50 from the
amount recredited;
(ii) The financial institution, promptly
but no later than two business days after
the provisional recrediting, orally reports
or mails or delivers notice to the consum­
er of the amount and date of the recredit­
ing and of the fact that the consumer
will have full use of the funds pending
the determination of whether an error
occurred;
(iii) The financial institution gives the
consumer full use of the funds provision­
ally recredited during the investigation;
and
(iv) If the financial institution deter­
mines that no error occurred and debits
the account, the institution gives notice
of the debiting and continues to honor
certain items as required by paragraph
(f) (2) of this section.
(3) A financial institution shall comply
with all requirements of this section except
that it need not provisionally recredit the
consumer’s account if— .
(i) it requires but does not receive time­
ly written confirmation of oral notice of
an error; or
(ii) the notice of an error involves an ac­
count that is subject to the margin re­
quirements or other aspects of Regula­
tion T (12 CFR 220).
(4) If a notice of an error involves an elec­
tronic fund transfer that was not initiated in
a state as defined in section 205.2(k), or
involves an electronic fund transfer result­
ing from a point-of-sale debit card transac­
tion, the applicable time periods for action
in subsections (c), (e), and (f) shall be 20
business days in place of 10 business days,
and 90 calendar days in place of 45 calen­
dar days.
11

§205.11
(d) Extent o f required investigation. (1) A fi­
nancial institution complies with its duty to
investigate, correct, and report its determi­
nation regarding an error described in para­
graph (a) (7) of this section by transmitting
the requested information, clarification, or
documentation within the time limits set
forth in paragraph (c) of this section. If the
institution has provisionally recredited the
consumer’s account in accordance with par­
agraph (c)(2) of this section, it may
debit the amount upon transmitting the
requested information, clarification, or
documentation.
(2) Except in the case of services covered
by section 205.14, a financial institution’s
review of its own records regarding an al­
leged error will satisfy its investigation re­
sponsibilities under paragraph (c) of this
section if the alleged error concerns a trans­
fer to or from a third party and there is no
agreement between the financial institution
and the third party11 regarding the type of
electronic fund transfer alleged in the error.
(3) A financial institution may make,
without investigation, a final correction to a
consumer’s account in the amount or man­
ner alleged by the consumer to be in error,
but must comply with all other applicable
requirements of this section.
(e) Procedure after financial institution deter­
mines that error occurred. If the financial insti­
tution determines that an error occurred, it
shall—
(1) Promptly, but no later than one busi­
ness day after its determination, correct the
error (subject to the liability provisions of
sections 205.6(a) and (b )), including,
where applicable, the crediting of interest
and the refunding of any fees or charges
imposed, and
(2) Promptly, but in any event within the
10-business-day or 45-day time limits, oral­

Regulation E
ly report or mail or deliver to the consumer
notice of the correction and, if applicable,
notice that a provisional credit has been
made final.12
(f) Procedures after financial institution de­
termines that no error occurred. If the financial
institution determines that no error occurred
or that an error occurred in a different man­
ner or amount from that described by the
consumer—
(1) The financial institution shall mail or
deliver to the consumer a written explana­
tion of its findings within 3 business days
after concluding its investigation, but in no
event later than 10 business days after re­
ceiving notice of the error if the institution
is proceeding under paragraph (c)(1) of
this section. The explanation shall include
notice of the consumer’s right to request the
documents upon which the institution re­
lied in making its determination.
(2) Upon debiting a provisionally recredit­
ed amount, the financial institution—
(i) Shall orally report or mail or deliver
notice to the consumer of the date and
amount of the debiting and the fact that
the financial institution will honor
checks, drafts, or similar paper instru­
ments payable to third parties and preau­
thorized transfers from the consumer’s
account (using the provisionally recredit­
ed funds) for five business days after
transmittal of the notice.
(ii) Shall honor checks, drafts, or simi­
lar paper instruments payable to third
parties and preauthorized transfer from
the consumer’s account (without charge
to the consumer as a result of an over­
draft) for five business days after trans­
mittal of the notice. The institution need
only honor items that it would have paid
if the provisionally recredited funds had
not been debited.
(3) Upon the consumer’s request, the fi­
nancial institution shall promptly mail or
deliver to the consumer copies of the docu­
ments on which it relied in making its de­
termination.

11 Institutions do not have an agreement for purposes of
paragraph (d) (2) of this section solely because they partic­
ipate in transactions under the federal recurring payments
program, or that cleared through an automated or other
clearing house or similar arrangement for the clearing and
12 This notice requirement may be satisfied by a notice on
settlement of fund transfers generally, or because they
a periodic statement that is mailed or delivered within the
agree to be bound by the rules of such arrangements. An
10-business-day or 45-day time limits and that clearly iden­
agreement that a third party will honor an access device is
tifies the correction to the consumer’s account.
an agreement for purposes of this paragraph.
12




Regulation E
(g) Withdrawal o f notice o f error. The finan­
cial institution has no further error-resolution
responsibilities as to a consumer’s assertion of
an error if the consumer concludes that no
error did in fact occur and voluntarily with­
draws the notice.
(h) Reassertion o f error. A financial institu­
tion that has fully complied with the require­
ments of this section with respect to an error
has no further responsibilities under this sec­
tion if the consumer subsequently reasserts
the same error, regardless of the manner in
which it is reasserted. This paragraph does
not preclude the assertion of an error defined
in paragraphs (a)(1 ) through (6) of this sec­
tion following the assertion of an error de­
scribed in paragraph (a) (7) of this section re­
garding the same electronic fund transfer.
(i) Relation to Truth in Lending. Where an
electronic fund transfer also involves an ex­
tension of credit under an agreement between
a consumer and a financial institution to ex­
tend credit when the consumer’s account is
overdrawn or to maintain a specified mini­
mum balance in the consumer’s account, the
financial institution shall comply with the re­
quirements of this section rather than those of
12 CFR 226.13(a), (b), (c), (e), (f), and
(h).

SE C T IO N 205.12 Relation to State Law
(a) Preemption o f inconsistent state laws. The
Board shall determine, upon the request of
any state, financial institution, or other inter­
ested party, whether the act and this regula­
tion preempt state laws relating to electronic
fund transfers. Only those state laws that are
inconsistent with the act and this regulation
shall be preempted and then only to the extent
of the inconsistency. A state law is not incon­
sistent with the act and this regulation if it is
more protective of a consumer.
(b) Standards for preemption. The following
are examples of the standards the Board will
apply in determining whether a state law, or a
provision of that law, is inconsistent with the
act and this regulation. Inconsistency may ex­
ist when state law—



§ 205.12
(1) Requires or permits a practice or act
prohibited by the act or this regulation;
(2) Provides for consumer liability for un­
authorized electronic fund transfers which
exceeds that imposed by the act and this
regulation;
(3) Provides for longer time periods than
the act and this regulation for investigation
and correction of errors alleged by a con­
sumer, or fails to provide for the recrediting
of the consumer’s account during the insti­
tution’s investigation of errors as set forth
in section 205.11(c); or
(4) Provides for initial disclosures, period­
ic statements, or receipts that are different
in content from that required by the act and
this regulation except to the extent that the
disclosures relate to rights granted to con­
sumers by the state law and not by the act
or this regulation.
(c) Procedures for preemption. Any request
for a determination shall include the
following:
(1) A copy of the full text of the state law
in question, including any regulatory imple­
mentation or judicial interpretation of that
law;
(2) A comparison of the provisions of state
law with the corresponding provisions in
the act and this regulation, together with a
discussion of reasons why specific provi­
sions of state law are either consistent or
inconsistent with corresponding sections of
the act and this regulation; and
(3) A comparison of the civil and criminal
liability for violation of state law with the
provisions of sections 915 and 916(a) of the
act.
(d) Exemption for state-regulated transfers.
(1) Any state may apply to the Board for
an exemption from the requirements of the
act and the corresponding provisions of this
regulation for any class of electronic fund
transfers within the state. The Board will
grant such an exemption if the Board deter­
mines that—
(i) Under the law of the state that class
of electronic fund transfers is subject to
requirements substantially similar to
those imposed by the act and the corre­

1
3

§ 205.12
sponding provisions of this regulation,
and
(ii) There is adequate provision for state
enforcement.
(2) To assure that the federal and state
courts will continue to have concurrent ju­
risdiction, and to aid in implementing the
act:
(i) No exemption shall extend to the
civil liability provisions of section 915 of
the act; and
(ii) After an exemption has been grant­
ed, for the purposes of section 915 of the
act, the requirements of the applicable
state law shall constitute the require­
ments of the act and this regulation, ex­
cept to the extent the state law imposes
requirements not imposed by the act or
this regulation.

SE C T IO N 205.13— A dm inistrative
Enforcem ent
(a) Enforcement by federal agencies. (1) Ad­
ministrative enforcement of the act and this
regulation for certain financial institutions
is assigned to the Comptroller of the Cur­
rency, Board of Governors of the Federal
Reserve System, Board of Directors of the
Federal Deposit Insurance Corporation,
Federal Home Loan Bank Board (acting
directly or through the Federal Savings and
Loan Insurance Corporation), National
Credit Union Administration Board, Civil
Aeronautics Board, and Securities and Ex­
change Commission.
(2) Except to the extent that administra­
tive enforcement is specifically committed
to other authorities, compliance with the
requirements imposed under the act and
this regulation is enforced by the Federal
Trade Commission.
(b) Issuance o f staff interpretations. (1) Un­
official staff interpretations are issued at the
staffs discretion where the protection of
section 915(d) of the act is neither request­
ed nor required, or where a rapid response
is necessary.
(2)(i) Official staff interpretations are is­
sued at the discretion of designated offi­
cials. No interpretations will be issued
14



Regulation E
approving financial institutions’ forms or
statements. Any request for an official
staff interpretation of this regulation shall
be made in writing and addressed to the
Director of the Division of Consumer
and Community Affairs, Board of Gover­
nors of the Federal Reserve System,
Washington, D.C. 20551. The request
shall contain a complete statement of all
relevant facts concerning the transfer or
service, and shall include copies of all
pertinent documents.
(ii) Within five business days of receipt
of a request, an acknowledgment will be
sent to the person making the request. If
the designated officials deem issuance of
an official staff interpretation to be appro­
priate, the interpretation will be pub­
lished in the Federal Register to become
effective 30 days after the publication
date. If a request for public comment is
received, the effective date will be sus­
pended. The interpretation will then be
republished in the Federal Register and
the public given an opportunity to com­
ment. Any official staff interpretation
issued after opportunity for public com­
ment shall become effective upon publi­
cation in the Federal Register.
(3) Any request for public comment on an
official staff interpretation of this regulation
shall be made in writing and addressed to
the Secretary, Board of Governors of the
Federal Reserve System, Washington, D.C.
20551. It must be postmarked or received
by the Secretary’s office within 30 days of
the interpretation’s publication in the Fed­
eral Register. The request shall contain a
statement setting forth the reasons why the
person making the request believes that
public comment would be appropriate.
(4) Pursuant to section 915(d) of the act,
the Board has designated the director and
other officials of the Division of Consumer
and Community Affairs as officials “duly
authorized” to issue, at their discretion, of­
ficial staff interpretations of this regulation.
(c) Record retention. (1) Evidence of com­
pliance with the requirements imposed by
the act and this regulation shall be pre­
served by any person subject to the act and

Regulation E
this regulation for a period of not less than
two years. Records may be stored by use of
microfiche, microfilm, magnetic tape, or
other methods capable of accurately retain­
ing and reproducing information.
(2) Any person subject to the act and this
regulation that has actual notice that it is
being investigated or is subject to an en­
forcement proceeeding by an agency
charged with monitoring that person’s com­
pliance with the act and this regulation, or
that has been served with notice of an ac­
tion filed under sections 910, 915, or 916(a)
of the act, shall retain the information re­
quired in paragraph (c)(1) of this section
that pertains to the action or proceeding
until final disposition of the matter, unless
an earlier time is allowed by order of the
agency or court.

SECTION 205.14—Services Offered by
Financial Institutions not Holding
Consumer’s Account
(a) Compliance by service-providing institu­
tion. Except as provided in this section, where
a financial institution issues an access device
to a consumer to be used for initiating elec­
tronic fund transfers to or from the consum­
er’s account held by another financial institu­
tion, and the service-providing institution
does not have an agreement with the account­
holding institution regarding the service, the
service-providing institution shall comply
with all requirements of the act and this regu­
lation that relate to the service or the electron­
ic fund transfers made by the consumer under
the service. For this purpose, the following
special rules shall apply:
(1) Section 205.6 shall require the service­
providing institution to reimburse the con­
sumer for unauthorized electronic fund
transfers in excess of the limits set by that
section.
(2) Sections 205.7, 205.8, and 205.9 shall
require the service-providing institution to
provide those disclosures and documenta­
tion that are within its knowledge and
the purview of its relationship with the
consumer.
(3) Section 205.11 (b) (1) (i) shall require
the service-providing institution to extend



§ 205.14
by a reasonable time the time periods with­
in which notice of an error must be received
if a delay in notifying the service-providing
institution was due to the fact that the con­
sumer initially notified or attempted to noti­
fy the account-holding institution.
(4) Sections 205.11(c) (2) (i) and (e)(1)
shall require the service-providing institu­
tion to transfer funds, in the appropriate
amount and within the applicable time peri­
od, to the consumer’s account at the ac­
count-holding institution.
(5) Section 205.11 (c)(2) (ii) shall require
the service-providing institution to disclose
the date on which it initiates a transfer to
effect the provisional recredit.
(6) Section 205.11(f)(2) shall require the
service-providing institution to notify the
account-holding institution of the date until
which the account-holding institution must
honor any debit to the account as required
by section 205.11(f)(2). If an overdraft re­
sults, the service-providing institution shall
promptly reimburse the account-holding in­
stitution in the amount of the overdraft.
(b) Compliance by account-holding institu­
tion. An account-holding institution described
in paragraph (a) of this section need not com­
ply with the requirements of the act and this
regulation with respect to electronic fund
transfers to or from the consumer’s account
made by the service-providing institution, ex­
cept that the account-holding institution shall
comply with section 205.11 by—
(1) Promptly providing, upon the request
of the service-providing institution, infor­
mation or copies of documents required for
the purpose of investigating alleged errors
or furnishing copies of documents to the
consumer; and
(2) Honoring debits to the account in ac­
cordance with section 205.11(f)(2).
(c) Definition o f agreement. For purposes of
this section, an agreement between the serv­
ice-providing and the account-holding institu­
tions regarding the electronic fund transfer
service refers to a specifc agreement (s)
among institutions (or among institutions and
another person that participates in the opera­
tion of the service) which sets forth the rights
and obligations of the institutions with respect
15

§ 205.14
to a service involving the issuance of an access
device to the consumer. Institutions do not
have such an agreement solely because they
participate in transactions that are cleared
through an automated or other clearinghouse
or similar arrangement for the clearing and
settlement of fund transfers generally, or be­
cause they agree to be bound by the rules of
such an arrangement.

A P P E N D IX A — M odel Disclosure
Clauses
This appendix contains model disclosure
clauses for optional use by financial institu­
tions to facilitate compliance with the disclo­
sure requirements of sections 205.5(a)(3),
(b)(2 ), and (b )(3 ), 205.6(a)(3), and 205.7.
Section 915(d) (2) of the act provides that use
of these clauses in conjunction with other re­
quirements of the regulation will protect fi­
nancial institutions from liability under sec­
tions 915 and 916 of the act to the extent that
the clauses accurately reflect the institutions’
electronic fund transfer services.
Financial institutions need not use any of
the clauses, but may use clauses of their own
design in conjunction with the model clauses.
The inapplicable words or portions of phrases
in parentheses should be deleted. The under­
scored catchlines are not part of the clauses
and should not be used as such. Financial in­
stitutions may make alterations, substitutions,
or additions in the clauses in order to reflect
the services offered, such as technical changes
(e.g., substitution of a trade name for the
word “card,” deletion of inapplicable services,
or substitution of lesser liability limits in sec­
tion A (2 )). Sections A (3), A(S) and A(9)
include references to a telephone number and
address. Where two or more of these clauses
are used in a disclosure, the telephone number
and address need not be repeated if
referenced.

SE C T IO N A ( l ) — Disclosure T h at
Access Device is N ot V alidated and H ow
to D ispose of Device if V alidation is N ot
Desired (§ 205.5(b) (3 ))
(a) Account using cards. YOU CANNOT
USE THE ENCLOSED CARD TO TRANS­

1
6



Regulation E
FER MONEY INTO OR OUT OF YOUR
ACCOUNT UNTIL WE HAVE VALIDAT­
ED IT. IF YOU DO NOT WANT TO USE
THE CARD, PLEASE (destroy it at once by
cutting it in half).
[Financial institution may add validation in­
structions here.]
(b) Accounts using codes. YOU CANNOT
USE THE ENCLOSED CODE TO TRANS­
FER MONEY INTO OR OUT OF YOUR
ACCOUNT UNTIL WE HAVE VALIDAT­
ED IT. IF YOU DO NOT WANT TO USE
THE CODE, PLEASE (destroy this notice at
once)
[Financial institution may add validation
instructions here.]

S E C T IO N A (2 )— D isclosure of
C onsum ers Liability for U nauthorized
Transfers and O ptional D isclosure of
A dvisability of P rom pt R eporting
(§ 2 0 5 .7 (a )(1 ))
(a) Liability disclosure. (Tell us AT ONCE if
you believe your (card) (code) has been lost
or stolen. Telephoning is the best way of keep­
ing your possible losses down. You could lose
all the money in your account (plus your
maximum overdraft line of credit). If you tell
us within two business 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 two 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 two 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.

Regulation E
If a good reason (such as a long trip or a
hospital stay) kept you from telling us, we
will extend the time periods.

SEC T IO N A (3 )— D isclosure of
Telephone N um ber and A ddress to Be
Notified in Event of U nauthorized
Transfer (§ 2 0 5 .7 (a )(2 ))
(a) Address and telephone number. If you be­
lieve your (card) (code) has been lost or sto­
len or that someone has transferred or may
transfer money from your account without
your permission, call:
[Telephone number]
or write:
[Name of person or office to be notified]
[Address]

SEC T IO N A ( 4 ) — Disclosure of W hat
Constitutes Business D ay of Institution
(§ 2 0 5 .7 (a )(3 ))
(a) Business day disclosure. Our business
days are (Monday through Friday) (Monday
through Saturday) (any day including Satur­
days and Sundays). Holidays are (not)
included.
SEC T IO N A ( 5 ) — Disclosure of Types of
Available Transfers and Lim its on
Transfers (§ 2 0 5 .7 (a )(4 ))
(a) Account access. You may use your
(card)(code) to
(1) Withdraw cash from your (check­
ing) (or) (savings) account.
(2) Make deposits to your (check­
ing) (or) (savings) account.
(3) Transfer funds between your checking
and savings accounts whenever you request.
(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 request.
Some of these services may not be available at
all terminals.
(b) Limitations on frequency o f transfers.
(1) You may make only [insert number,



§ A(6)
e.g., three] cash withdrawals from our ter­
minals each [insert time period, e.g.,
week].
(2) You can use your telephone bill-pay­
ment 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 [insert time period].
(4) For security reasons, there are (other)
limits on the number of transfers you can
make using our (terminals) (telephone billpayment service) (point-of-sale transfer
service).
(c) Limitations on dollar amounts o f trans­
fers. (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 point-of-sale transfer
service.

SE C T IO N A (6 )— D isclosure of Charges
for Transfers or R ight to M ake Transfers
(§ 2 0 5 .7 (a )(5 ))
(a) Per transfer charge. We will charge you
[insert dollar amount] for each transfer you
make using our (automated teller machines)
(telephone bill-payment service) (point-ofsale transfer service).
(b) Fixed charge. We will charge you [insert
dollar amount] each [insert time period] for
our (automated teller machine service) (tele­
phone bill-payment service) (point-of-sale
transfer service).
(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) (ac­
counts) falls below [insert dollar amount]. If
it does, we will charge you [insert dollar
amount] each (transfer) ([insert time
period]).
17

§ A(7)
SEC T IO N A (7 )— D isclosure o f A ccount
Inform ation to T h ird Parties
(§ 2 0 5 .7 (a )(9 ))
(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
condition 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.

SE C T IO N A ( 8 ) — D isclosure o f R ight to
Receive D ocum entation o f Transfers
(§ 2 0 5 .7 (a )(6 ))
(a) Terminal transfers. You can get a receipt
at the time you make any transfer to or from
you account using one of our (automated tell­
er machines) (or) (point-of-sale terminals).
(b) Preauthorized credits. If you have ar­
ranged to have direct deposits made to your
account at least once every 60 days from the
same person or company,
(we will let you know if the deposit is (not)
made.)
(the person or company making the deposit
will tell you every time they send us the
money.)
(you can call us at [insert telephone num­
ber] to find out whether or not the deposit has
been made.)
(c) Periodic statements. You will get a
(monthly) (quarterly) account statement
(unless there are no transfers in a particular
month. In any case you will get the statement
at least quarterly).
(d) Passbook account where the only possible
electronic fu n d transfers are preauthorized
credits. 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.
18



Regulation E
SE C T IO N A (9 )— D isclosure of R ight to
Stop Paym ent of P reauthorized
Transfers, Procedure for Doing So, R ight
to Receive N otice of Varying A m ounts,
and Financial Institution’s Liability for
Failure to Stop Paym ent (§ 205.7(a) (6 ),
(7 ), and (8 ))
(a) Right to stop payment and procedure for
doing so. If you have told us in advance to
make regular payments out of your account,
you can stop any of these payments. Here’s
how:
Call us at [insert telephone number], or
write us at [insert address], in time for us to
receive your request three business days or
more before the payment is scheduled to be
made. If you call, we may also require you to
put your request in writing and get it to us
within 14 days after you call. (We will charge
you [insert amount] for each stop-payment
order you give.)
(b) Notice o f varying amounts. If these regu­
lar payments may vary in amount, (we) (the
person you are going to pay) will tell you, 10
days before each payment, when it will be
made and how much it will be. (You may
choose instead to get this notice only when the
payment would differ by more than a certain
amount from the previous payment, or when
the amount would fall outside certain limits
that you set.)
(c) Liability for failure to stop payment o f
preauthorized transfer. If you order us to stop
one of these payments three business days or
more before the transfer is scheduled, and we
do not do so, we will be liable for your losses
or damages.

SE C T IO N A (1 0 )— D isclosure of
Financial Institution’s Liability for
F ailure to M ake Transfers
(§ 2 0 5 .7 (a )(8 ))
(a) Liability for failure to make transfers. If
we do not complete a transfer to or from your
account on time or in the correct amount ac­
cording to our agreement with you, we will be
liable for your losses or damages. However,
there are some exceptions. We will NOT be
liable, for instance—

Regulation E

Appendix B

° If, through no fault of ours, you do not
have enough money in your account to
make the transfer.

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

® If the transfer would go over the credit
limit on your overdraft line.

Nonmember Insured Banks
Federal Deposit Insurance Corporation re­
gional director for the region in which the
nonmember insured bank is located.

• If the automated teller machine where you
are making the transfer does not have
enough cash.
° If the (terminal) (system) was not work­
ing properly and you knew about the
breakdown when you started the transfer.
° If circumstances beyond our control (such
as fire or flood) prevent the transfer, de­
spite reasonable precautions that we have
taken.
There may be other exceptions stated in our
agreement with you.

A P P E N D IX B— Federal Enforcem ent
Agencies
The following list indicates which federal
agency enforces Regulation E for particular
classes of institutions. Any questions concern­
ing compliance by a particular institution
should be directed to the appropriate enforc­
ing agency.
National Banks
Comptroller of the Currency
Office of Customer and Community Programs
Washington, D.C. 20219




Savings Institutions Insured by the FSLIC and
Members o f the FHLB System (except for Sav­
ings Banks insured by FDIC)
The Federal Home Loan Bank Board supervi­
sory agent in the District in which the institu­
tion 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, Certain Other Financial Institu­
tions, and All Nonbank Debit Card Issuers
Federal Trade Commission
Electronic Fund Transfers
Washington, D.C. 20580

19




Electronic Fund Transfer Act
15 USC 1693 et seq.; 92 Stat. 3728; Pub. L. 95-630, Financial Institutions
Regulatory and Interest Rate Control Act, Title XX (November 10, 1978)

F IR A , T IT L E X X —Electronic F und
Transfers
SECTION 2001
The Consumer Credit Protection Act (15
U.S.C. 1601 et seq.) is amended by adding at
the end thereof the following new title:

T IT L E IX — E L E C T R O N IC F U N D
TR A N S F E R S

SEC T IO N 901— Short Title
This title may be cited as the “Electronic
Fund Transfer Act” .

SEC T IO N 902— Findings and Purpose
(a) The Congress finds that the use of elec­
tronic systems to transfer funds provides the
potential for substantial benefits to consumers.
However, due to the unique characteristics of
such systems, the application of existing con­
sumer protection legislation is unclear, leaving
the rights and liabilities of consumers, finan­
cial institutions, and intermediaries in elec­
tronic fund transfers undefined.
(b) It is the purpose of this title to provide a
basic framework establishing the rights, liabil­
ities, and responsibilities of participants in
electronic fund transfer systems. The primary
objective of this title, however, is the provision
of individual consumer rights.

SEC T IO N 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 ac­
count for the purpose of initiating electron­
ic fund transfers when the person to whom
such card or other means of access was is­
sued 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, la­
bor, or services;
(2) the term “account” means a demand
deposit, savings deposit, or other asset ac­
count (other than an occasional or inciden­
tal credit balance in an open end credit plan
as defined in section 103 (i) of this Act), as
described in regulations of the Board, estab­
lished primarily for personal, family, or
household purposes, but such term does not
include an account held by a financial insti­
tution pursuant to a bona fide trust
agreement;
(3) the term “Board” means the Board of
Governors of the Federal Reserve System:
(4) the term “business day” means any
day on which the offices of the consumer’s
financial institution involved in an electron­
ic fund transfer are open to the public for
carrying on substantially all of its business
functions;
(5) the term “consumer” means a natural
person;
(6) the term “electronic fund transfer”
means any transfer of funds, other than a
transaction originated by check, draft, or
similar paper instrument, which is initiated
through an electronic terminal, telephonic
instrument, or computer or magnetic tape
so as to order, instruct, or authorize a finan­
cial institution to debit or credit an account.
Such term includes, but is not limited to,
point-of-sale transfers, automated teller ma­
chine transactions, direct deposits or with­
drawals of funds, and transfers initiated by
telephone. Such term does not include—
(A) any check guarantee or authoriza­
tion service 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 clearing­
house, made by a financial institution on
behalf of a consumer by means of a serv­
ice that transfers funds held at either
21

§903
Federal Reserve banks or other deposito­
ry institutions and which is not designed
primarily to transfer funds on behalf of a
consumer;
(C) any transaction the primary pur­
pose 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;
(D ) any automatic transfer from a sav­
ings account to a demand deposit ac­
count pursuant to an agreement between
a consumer and a financial institution for
the purpose of covering an overdraft or
maintaining an agreed upon minimum
balance in the consumer’s demand depos­
it account; or
(E) any transfer of funds which is initia­
ted by a telephone conversation between
a consumer and an officer or employee of
a financial institution which is not pursu­
ant 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 lim­
ited to, point-of-sale terminals, automated
teller machines, and cash dispensing
machines;
(8) the term “financial institution” means
a State or National bank, a State or Federal
savings and loan association, a mutual sav­
ings bank, a State or Federal credit union,
or any other person who, directly or indi­
rectly, holds an account belonging to a
consumer;
(9) the term “preauthorized electronic
fund transfer” means an electronic fund
transfer authorized in advance to recur at
substantially regular intervals;
(10) the term “State” means any State,
territory, or possession of the United States,
the District of Columbia, the Common­
wealth of Puerto Rico, or any political sub­
division of any of the foregoing; and
(11) the term “unauthorized electronic
fund transfer” means an electronic fund
22




Electronic Fund Transfer Act
transfer from a consumer’s account initiat­
ed by a person other than the consumer
without actual authority to initiate such
transfer and from which the consumer re­
ceives no benefit, but the term does not in­
clude any electronic fund transfer (A) ini­
tiated 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 consumer, unless the con­
sumer has notified the financial institution
involved that transfers by such other person
are no longer authorized, (B) initiated with
fraudulent intent by the consumer or any
person acting in concert with the consumer,
or (C) which constitutes an error commit­
ted by a financial institution.

S E C T IO N 904— Regulations
(a) The Board shall prescribe regulations to
carry out the purposes of this title. In pre­
scribing such regulations, the Board shall:
(1) consult with the other agencies re­
ferred to in section 917 and take into ac­
count, and allow for, the continuing evolu­
tion of electronic banking services and the
technology utilized in such services,
(2) prepare an analysis of economic im­
pact which considers the cost and benefits
to financial institutions, consumers, and
other users of electronic fund transfers, in­
cluding the extent to which additional doc­
umentation, 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 avail­
ability of such services to different classes
of consumers, particularly low income
consumers,
(3) to the extent practicable, the Board
shall demonstrate that the consumer pro­
tections of the proposed regulations out­
weigh the compliance costs imposed upon
consumers and financial institutions, and
(4) any proposed regulations and accom­
panying analyses shall be sent promptly to
Congress by the Board.
(b) The Board shall issue model clauses for
optional use by financial institutions to facili­

Electronic Fund Transfer Act
tate compliance with the disclosure require­
ments of section 905 and to aid consumers in
understanding the rights and responsibilities
of participants in electronic fund transfers by
utilizing readily understandable language.
Such model clauses shall be adopted after no­
tice duly given in the Federal Register and
opportunity for public comment in accord­
ance with section 553 of title 5, United States
Code. With respect to the disclosures required
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 al­
ternative model clauses for disclosure of these
differing account terms.
(c) Regulations prescribed hereunder may
contain 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 effec­
tuate the purposes of this title, to prevent cir­
cumvention or evasion thereof, or to facilitate
compliance therewith. The Board shall by reg­
ulation modify the requirements imposed by
this title on small financial institutions if the
Board determines that such modifications are
necessary to alleviate any undue compliance
burden on sm all 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 hold­
ing a consumer’s account, the Board shall by
regulation assure that the disclosures, protec­
tions, responsibilities, and remedies created by
this title are made applicable to such persons
and services.

SE C T IO N 905— Term s and Conditions
of Transfers
(a) The terms and conditions of electronic
fund transfers involving a consumer’s account
shall be disclosed at the time the consumer
contracts for an electronic fund transfer serv­
ice, in accordance with regulations of the
Board. Such disclosures shall be in readily un­



§905
derstandable language and shall include, to
the extent applicable—
(1) the consumer’s liability for unautho­
rized electronic fund transfers and, at the
financial institution’s option, notice of the
advisability of prompt reporting of any loss,
theft, or unauthorized use of a card, code,
or other means of access;
(2) the telephone number and address of
the person or office to be notified in the
event the consumer believes that an unau­
thorized electronic fund transfer has been
or may be effected;
(3) the type and nature of electronic fund
transfers which the consumer may initiate,
including 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 neces­
sary to maintain the security of an electron­
ic fund transfer system, as determined by
the Board;
(4) any charges for electronic fund trans­
fers 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 docu­
mentation of electronic fund transfers un­
der section 906;
(7) a summary, in a form prescribed by
regulations of the Board, of the error reso­
lution provisions of section 908 and the
consumer’s rights thereunder. The financial
institution shall thereafter transmit such
summary at least once per calendar year;
(8) the financial institution’s liability to
the consumer under section 910; and
(9) under what circumstances the financial
institution 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 pri­
or 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 would result in greater cost or
liability for such consumer or decreased ac­
cess to the consumer’s account. A financial
23

§905
institution may, however, implement a change
in the terms or conditions of an account with­
out prior notice when such change is immedi­
ately necessary to maintain or restore the se­
curity of an electronic fund transfer system or
a consumer’s account. Subject to subsection
(a)(3 ), the Board shall require subsequent
notification if such a change is made
permanent.
(c) For any account of a consumer made ac­
cessible to electronic fund transfers prior to
the effective date of this title, the information
required to be disclosed to the consumer un­
der subsection (a) shall be disclosed not later
than the earlier of—
(1) the first periodic statement required by
section 906(c) after the effective date of
this title; or
(2) thirty days after the effective date of
this title.

SE C T IO N 906— D ocum entation of
Transfers; Periodic Statem ents
(a) For each electronic fund transfer initiat­
ed by a consumer from an electronic terminal,
the financial institution holding such consum­
er’s account shall, directly or indirectly, at the
time the transfer is initiated, make available to
the consumer 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
electronic terminal involved.
(b) For a consumer’s account which is
scheduled to be credited by a preauthorized
electronic fund transfer from the same payor
at least once in each successive sixty-day peri­
od, except where the payor provides positive
notice of the transfer to the consumer, the fi­
nancial institution shall elect to provide
24




Electronic Fund Transfer Act
promptly either positive notice to the consum­
er when the credit is made as scheduled, 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 con­
sumer in accordance with section 905.
(c) A financial institution shall provide each
consumer with a periodic statement for each
account of such consumer that may be ac­
cessed by means of an electronic fund trans­
fer. Except as provided in subsections (d) and
(e), such statement 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 frequent. The statement,
which may include information regarding
transactions other than electronic fund trans­
fers, 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 as­
sessed by the financial institution during the
period for electronic fund transfers or for
account maintenance;
(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 consum­
er. Such address and telephone number
shall be preceded by the caption “Direct In­
quiries To:” or other similar language indi­
cating 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 electron­
ic fund transfers other than preauthorized
electronic fund transfers crediting the ac­
count, a financial institution may, in lieu of
complying with the requirements of subsec­
tion (c), upon presentation of the passbook
provide the consumer in writing with the
amount and date of each such transfer involv­
ing the account since the passbook was last
presented.

Electronic Fund Transfer Act
(e) In the case of a consumer’s account other
than a passbook account, which may not be
accessed by electronic fund transfers other
than preauthorized electronic fund transfers
crediting the account, the financial institution
may provide a periodic statement on a quar­
terly basis which otherwise complies with the
requirements of subsection (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 admissible as evidence of such
transfer and shall constitute prima facie proof
that such transfer was made.

SEC T IO N 907— Preauthorized Transfers
(a) A preauthorized electronic fund transfer
from a consumer’s account may be authorized
by the consumer only in writing, and a copy
of such authorization shall be provided to the
consumer 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 confirmation to be provided to
it within fourteen days of an oral notification
if, when the oral notification is made, the con­
sumer 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 insti­
tution or designated payee shall, prior to each
transfer, provide reasonable advance notice to
the consumer, in accordance with regulations
of the Board, of the amount to be transferred
and the scheduled date of the transfer.

SEC T IO N 908— E rro r Resolution
(a) If a financial institution, within sixty days
after having transmitted to a consumer docu­
mentation pursuant to section 906 (a), (c), or
(d) or notification pursuant to section



§908
906(b), receives oral or written notice in
which the consumer—
(1) sets forth or otherwise enables the fi­
nancial institution to identify the name and
account number of the consumer;
(2) indicates the consumer’s belief that the
documentation, or, in the case of notifica­
tion pursuant to section 906(b), the con­
sumer’s account, contains an error and the
amount of such error; and
(3) sets forth the reasons for the consum­
er’s belief (where applicable) that an error
has occurred, the financial institution shall
investigate the alleged error, determine
whether an error has occurred, and report
or mail the results of such investigation and
determination to the consumer within ten
business days. The financial institution may
require written confirmation to be provided
to it within ten business days of an oral no­
tification of error if, when the oral notifica­
tion is made, the consumer is advised of
such requirement and the address to which
such confirmation should be sent. A finan­
cial institution which requires written con­
firmation in accordance with the previous
sentence need not provisionally recredit a
consumer’s account in accordance with
subsection (c), nor shall the financial insti­
tution be liable under subsection (e) if the
written confirmation is not received within
the ten-day period referred to in the previ­
ous 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 determination, correct the error, subject
to section 909, including the crediting of inter­
est where applicable.
(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 receiv­
ing such notice provisionally recredit the con­
sumer’s account for the amount alleged to be
in error, subject to section 909, including in­
terest where applicable, pending the conclu­
sion of its investigation and its determination
of whether an error has occurred. Such inves­
tigation shall be concluded not later than for­

2
5

§908
ty-five days after receipt of notice of the error.
During the pendency of the investigation, the
consumer shall have full use of the funds pro­
visionally recredited.
(d) If the financial institution determines af­
ter its investigation pursuant to subsection (a)
or (c) that an error did not occur, it shall
deliver or mail to the consumer an explana­
tion of its findings within 3 business days after
the conclusion of its investigation, and upon
request of the consumer promptly deliver or
mail to the consumer reproductions of all doc­
uments which the financial institution relied
on to conclude that such error did not occur.
The financial institution shall include notice
of the right to request reproductions with the
explanation of its findings.
(e) If in any action under section 915, the
court finds that—
(1) the financial institution did not provi­
sionally recredit a consumer’s account
within the ten-day period specified in sub­
section (c), and the financial institution
(A) did not make a good faith investigation
of the alleged error, or (B) did not have a
reasonable basis for believing that the con­
sumer’s account was not in error; or
(2) the financial institution knowingly and
willfully concluded that the consumer’s ac­
count was not in error when such conclu­
sion could not reasonably have been drawn
from the evidence available to the financial
institution at the time of its investigation,
then the consumer shall be entitled 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
consumer’s account which should have
been included;
(4) a computational error by the financial
institution;
(5) the consumer’s receipt of an incorrect

2
6



Electronic Fund Transfer Act
amount of money from an electronic
terminal;
(6) a consumer’s request for additional in­
formation or clarification concerning an
electronic fund transfer or any documenta­
tion required by this title; or
(7) any other error described in regula­
tions of the Board.

SE C T IO N 909— Consum er Liability for
U nauthorized Transfers
(a) A consumer shall be liable for any unau­
thorized electronic fund transfer involving the
account of such consumer only if the card or
other means of access utilized for such trans­
fer was an accepted card or other means of
access and if the issuer of such card, code, or
other means of access has provided a means
whereby the user of such card, code, or other
means of access can be identified as the person
authorized to use it, such as by signature, pho­
tograph, or fingerprint or by electronic or me­
chanical confirmation. In no event, however,
shall a consumer’s liability for an unautho­
rized transfer exceed the lesser of—
(1) $50; or
(2) the amount of money or value of prop­
erty or services obtained in such unautho­
rized electronic fund transfer prior to the
time the financial institution is notified of,
or otherwise becomes aware of, circum­
stances which lead to the reasonable belief
that an unauthorized electronic fund trans­
fer involving the consumer’s account has
been or may be effected. Notice under this
paragraph is sufficient when such steps have
been taken as may be reasonably required
in the ordinary course of business to pro­
vide the financial institution with the perti­
nent information, whether or not any par­
ticular officer, employee, or agent of the
financial institution does in fact receive
such information.
Notwithstanding the foregoing, reimburse­
ment 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 extenuat­
ing circumstances such as extended travel or

Electronic Fund Transfer Act
hospitalization, within a reasonable time un­
der the circumstances) any unauthorized elec­
tronic 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 con­
sumer for losses which the financial institution
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
circumstances such as extended travel or hos­
pitalization, within a longer period which is
reasonable under the circumstances), but the
consumer’s liability under this subsection in
any such case may not exceed a total of $500,
or the amount of unauthorized electronic fund
transfers which occur following the close of
two business days (or such longer period) af­
ter the consumer learns of the loss or theft but
prior to notice to the financial institution un­
der this subsection, whichever is less.
(b) In any action which involves a consum­
er’s liability for an unauthorized electronic
fund transfer, the burden of proof is upon the
financial institution to show that the electron­
ic fund transfer was authorized or, if the elec­
tronic fund transfer was unauthorized, then
the burden of proof is upon the financial insti­
tution to establish that the conditions of liabil­
ity set forth in subsection (a) have been met,
and, if the transfer was initiated after the ef­
fective date of section 905, that the disclosures
required to be made to the consumer under
section 905(a) (1) and (2) were in fact made
in accordance with such section.
(c) In the event of a transaction which in­
volves 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 fi­
nancial institution to extend such credit to the
consumer in the event the consumer’s account
is overdrawn, the limitation on the consum­
er’s liability for such transaction shall be
determined solely in accordance with this
section.
(d) Nothing in this section imposes liability
upon a consumer for an unauthorized elec­



§910
tronic fund transfer in excess of his liability
for such a transfer under other applicable law
or under any agreement with the consumer’s
financial institution.
(e) Except as provided in this section, a con­
sumer incurs no liability from an unautho­
rized electronic fund transfer.

SECTION 910—Liability of Financial
Institutions
(a) Subject to subsections (b) and (c), a fi­
nancial institution shall be liable to a consum­
er for all damages proximately caused by—
(1) the financial institution’s failure to
make an electronic fund transfer, in accord­
ance with the terms and conditions of an
account, in the correct amount or in a time­
ly manner when properly instructed to do
so by the consumer, except where—
(A) the consumer’s account has insuffi­
cient funds;
(B) the funds are subject to legal process
or other encumbrance restricting such
transfer;
(C) such transfer would exceed an es­
tablished credit limit;
(D) an electronic terminal has insuffi­
cient cash to complete the transaction; or
(E) as otherwise provided in regulations
of the Board;
(2) the financial institution’s failure to
make an electronic fund transfer due to in­
sufficient funds when the financial institu­
tion failed to credit, in accordance with the
terms and conditions of an account, a de­
posit of funds to the consumer’s account
which would have provided sufficient funds
to make the transfer, and
(3) the financial institution’s failure to stop
payment of a preauthorized transfer from a
consumer’s account when instructed to do
so in accordance with the terms and condi­
tions of the account.
(b) A financial institution shall not be liable
under subsection (a)(1) or (2) if the financial
institution shows by a preponderance of the
evidence that its action or failure to act result­
ed from—
(1) an act of God or other circumstance

2
7

§910
beyond its control, that it exercised reason­
able care to prevent such an occurrence,
and that it exercised such diligence as the
circumstances required; or
(2) a technical malfunction which was
known to the consumer at the time he at­
tempted to initiate an electronic fund trans­
fer or, in the case of a preauthorized trans­
fer, 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, not­
withstanding the maintenance of procedures
reasonably adapted to avoid any such error,
the financial institution shall be liable for ac­
tual damages proved.

S E C T IO N 911— Issuance of C ards or
O ther M eans of Access
(a) No person may issue to a consumer any
card, code, or other means of access to such
consumer’s account for the purpose of initiat­
ing an electronic fund transfer other than—
(1) in response to a request or application
therefor; or
(2) as a renewal of, or in substitution for,
an accepted card, code, or other means of
access, whether issued by the initial issuer
or a successor.
(b) Notwithstanding the provisions of sub­
section (a), a person may distribute to a con­
sumer on an unsolicited basis a card, code, or
other means of access for use in initiating an
electronic fund transfer from such consumer’s
account, if—
(1) such card, code, or other means of ac­
cess is not validated;
(2) such distribution is accompanied by a
complete disclosure, in accordance with
section 905, of the consumer’s rights and
liabilities which will apply if such card,
code, or other means of access is validated;
(3) such distribution is accompanied by a
clear explanation, in accordance with regu­
lations of the Board, that such card, code,
or other means of access is not validated
and how the consumer may dispose of such

2
8



Electronic Fund Transfer Act
code, card, or other means of access if vali­
dation is not desired; and
(4) such card, code, or other means of
access is validated only in response to
a request or application 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 validat­
ed when it may be used to initiate an electron­
ic fund transfer.

SE C T IO N 912— Suspension of
Obligations
If a system malfunction prevents the effectua­
tion of an electronic fund transfer initiated by
a consumer to another person, and such other
person has agreed to accept payment by such
means, the consumer’s obligation to the other
person shall be suspended until the malfunc­
tion is corrected and the electronic fund trans­
fer may be completed, unless such other per­
son has subsequently, by written request,
demanded payment by means other than an
electronic fund transfer.

S E C T IO N 913— Com pulsory Use of
Electronic F u n d Transfers
No person may—
(1) condition the extension of credit to a
consumer on such consumer’s repayment
by means of preauthorized electronic fund
transfers; or
(2) require a consumer to establish an ac­
count for receipt of electronic fund trans­
fers with a particular financial institution as
a condition of employment or receipt of a
government benefit.

SE C T IO N 914— W aiver of R ights
No writing or other agreement between a con­
sumer and any other person may contain any
provision which constitutes a waiver of any
right conferred or cause of action created by
this title. Nothing in this section prohibits,
however, any writing or other agreement
which grants to a consumer a more extensive

Electronic Fund Transfer Act
right or remedy or greater protection than
contained in this title or a waiver given in set­
tlement of a dispute or action.

SEC T IO N 915— Civil Liability
(a) Except as otherwise provided by this sec­
tion and section 910, any person who fails to
comply with any provision of this title with
respect to any consumer, except for an error
resolved in accordance with section 908, is lia­
ble to such consumer in an amount equal to
the sum of—
(1) any actual damage sustained by such
consumer 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 this
subparagraph in any class action or series
of class actions arising out of the same
failure to comply by the same person
shall not be more than the lesser of
$500,000 or 1 per centum of the net
worth of the defendant; and
(3) in the case of any successful action to
enforce the foregoing liability, the costs of
the action, together with a reasonable attor­
ney’s fee as determined by the court,
(b) In determining the amount of liability in
any action under subsection (a), the court
shall consider, among other relevant factors—
(1) in any individual action under subsec­
tion (a )(2 )(A ), the frequency and persis­
tence of noncompliance, the nature of such
noncompliance, and the extent to which the
noncompliance was intentional; or
(2) in any class action under subsection
(a)(2 )(B ), the frequency and persistence
of noncompliance, the nature of such com­
pliance, the resources of the defendant, the
number of persons adversely affected, and
the extent to which the noncompliance was
intentional.
(c) Except as provided in section 910, a per­
son may not be held liable in any action



§915
brought under this section for a violation of
this title if the person shows by a preponder­
ance of evidence that the violation was not
intentional and resulted from a bona fide error
notwithstanding the maintenance of proce­
dures reasonably adapted to avoid any such
error.
(d) No provision of this section or section
916 imposing any liability shall apply to—
(1) any act done or omitted in good faith
in conformity with any rule, regulation, or
interpretation thereof by the Board or in
conformity with any interpretation or ap­
proval by an official or employee of the
Federal Reserve System duly authorized by
the Board to issue such interpretations or
approvals under such procedures as the
Board may prescribe therefor; or
(2) any failure to make disclosure in prop­
er form if a financial institution utilized an
appropriate model clause issued by the
Board,
notwithstanding that after such act, omission,
or failure has occurred, such rule, regulation,
approval, or model clause is amended, re­
scinded, or determined by judicial or other au­
thority to be invalid for any reason.
(e) A person has no liability under this sec­
tion for any failure to comply with any re­
quirement under this title if, prior to the insti­
tution 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 appropriate adjustment to
the consumer’s account and pays actual dam­
ages or, where applicable, damages in accord­
ance 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 expend­
ed 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 occur­
rence of the violation.
29

§916
SEC T IO N 916— Crim inal Liability
(a) Whoever knowingly and willfully—
(1) gives false or inaccurate information or
fails to provide information which he is re­
quired to disclose by this title or any regula­
tion 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
interstate or foreign commerce, uses or at­
tempts 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 pe­
riod has a value aggregating $1,000 or
more; or
(2) with unlawful or fraudulent intent,
transports or attempts or conspires to trans­
port in interstate or foreign commerce a
counterfeit, fictitious, altered, forged, lost,
stolen, or fraudulently obtained debit in­
strument knowing the same to be counter­
feit, fictitious, altered, forged, lost, stolen,
or fraudulently obtained; or
(3) with unlawful or fraudulent intent,
uses any instrumentality of interstate or
foreign commerce to sell or transport a
counterfeit, fictitious, altered, forged, lost,
stolen, or fraudulently obtained debit in­
strument knowing the same to be counter­
feit, fictitious, altered, forged, lost, stolen,
or fraudulently obtained; or
(4) knowingly receives, conceals, uses, or
transports money, goods, services, or any­
thing else of value (except tickets for inter­
state or foreign transportation) which (A)
within any one-year period has a value ag­
gregating $1,000 or more, (B) has moved
in or is part of, or which constitutes inter­
state 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 transportation, which (A) with­

3
0



Electronic Fund Transfer Act

in any one-year period have a value aggre­
gating $500 or more, and (B) have been
purchased or obtained with one or more
counterfeit, fictitious, altered, forged, lost,
stolen, or fraudulently obtained debit in­
strument; or
(6) in a transaction affecting interstate or
foreign commerce, furnishes money, prop­
erty, services, or anything else of value,
which within any one-year period has a val­
ue aggregating $1,000 or more, through the
use of any counterfeit, fictitious, 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 im­
prisoned not more than ten years, or both.
(c) As used in this section, the term “debit
instrument” means a card, code, or other de­
vice, other than a check, draft, or similar pa­
per instrument, by the use of which a person
may initiate an electronic fund transfer.

S E C T IO N 917— A dm inistrative
E nforcem ent
(a) Compliance with the requirements im­
posed under this title shall be enforced
under—
(1) section 8 of the Federal Deposit Insur­
ance Act, in the case of—
(A) national banks, by the Comptroller
of the Currency;
(B) member banks of the Federal Re­
serve System (other than national
banks), by the Board;
(C) banks insured by the Federal De­
posit Insurance Corporation (other than
members of the Federal Reserve Sys­
tem), by the Board of Directors of the
Federal Deposit Insurance Corporation;
(2) section 5(d) of the Home Owners’
Loan Act of 1933, section 407 of the Na­
tional Housing Act, and sections 6(i) and
17 of the Federal Home Loan Bank Act, by
the Federal Home Loan Bank Board (act­
ing directly or through the Federal Savings
and Loan Insurance Corporation), in the
case of any institution subject to any of
those provisions;

Electronic Fund Transfer Act
(3) the Federal Credit Union Act, by the
Administrator of the National Credit Un­
ion Administration 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 sub­
ject to that Act; and
(5) the Securities Exchange Act of 1934,
by the Securities and Exchange Commis­
sion, 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 sub­
section, a violation of any requirement im­
posed under this title shall be deemed to be a
violation of a requirement imposed under that
Act. In addition to its powers under any pro­
vision of law specifically referred to in subsec­
tion (a), each of the agencies referred to in
that subsection may exercise, 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
specifically committed to some other Govern­
ment agency under subsection (a), the Feder­
al Trade Commission shall enforce such re­
quirements. For the purpose of the exercise by
the Federal Trade Commission of its func­
tions and powers under the Federal Trade
Commission Act, a violation of any require­
ment 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
Federal Trade Commission Act are available
to the Commission to enforce compliance by
any person 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.

SECTION 918—Reports to Congress
(a) Not later than twelve months after the



§919
effective date of this title and at one-year in­
tervals thereafter, the Board shall make re­
ports to the Congress concerning the adminis­
tration of its functions under this title, includ­
ing such recommendations as the Board
deems necessary or appropriate. In addition,
each report of the Board shall include its as­
sessment of the extent to which compliance
with this title is being achieved, and a summa­
ry of the enforcement actions taken under sec­
tion 917 of this title. In such report, the Board
shall particularly address the effects of this ti­
tle on the costs and benefits to financial insti­
tutions and consumers, on competition, on the
introduction of new technology, on the opera­
tions of financial institutions, and on the ade­
quacy of consumer protection.
(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 regulato­
ry or supervisory functions with respect to
any class of persons subject to this title.

SECTION 919—Relation to State Laws
This title does not annul, alter, or affect the
laws of any State relating to electronic fund
transfers, except to the extent that those laws
are inconsistent with the provisions of this ti­
tle, and then only to the extent of the incon­
sistency. A State law is not inconsistent with
this title if the protection such law affords any
consumer is greater than the protection af­
forded by this title. The Board shall, upon its
own motion or upon the request of any finan­
cial institution, State, or other interested par­
ty, submitted in accordance with procedures
prescribed in regulations of the Board, deter­
mine whether a State requirement is inconsist­
ent or affords greater protection. If the Board
determines that a State requirement is incon­
sistent, financial institutions shall incur no lia­
bility under the law of that State for a good
faith failure to comply with that law, notwith­
standing that such determination is subse­
quently amended, rescinded, or determined by
judicial or other authority to be invalid for
any reason. This title does not extend the ap­
plicability of any such law to any class of per31

§919
sons or transactions to which it would not
otherwise apply.

Electronic Fund Transfer Act
subject to requirements substantially similar
to those imposed by this title, and that there is
adequate provision for enforcement.

SECTION 920—Exemption for State
Regulation

SECTION 921—Effective Date

The Board shall by regulation exempt from
the requirements of this title any class of elec­
tronic fund transfers within any State if the
Board determines that under the law of that
State that class of electronic fund transfers is

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

3
2