What does the Electronic Funds Transfer Act cover?

What does the Electronic Funds Transfer Act cover?

The Electronic Fund Transfer Act (EFTA) protects consumers when transferring funds electronically. The EFTA was enacted in 1978 as a result of the increased use of ATMs. Protection under the EFTA includes transfers made via ATMs, debit cards, direct deposits, point-of-sale, and phone.

Who does the EFTA apply to?

More specifically, the EFTA applies to electronic transfers of money between two separate institutions. It does not apply to automatic account transfers within the same financial institution.

Which is not covered by the Electronic Fund Transfer Act?

Regulation E does not apply to a foreign branch of a U.S. financial institution unless the EFT services are offered in connection with an account in a state, as defined in section 205.2(l).

What happens if you violate Reg E?

Fines – “Failure to comply with Regulation E may result in liability for the actual damages sustained by the consumer, statutory damages of $100 – $1000, class action damages in the lesser of $500,000 or 1% of net worth, as well as reasonable attorney’s fees and costs as determined by the court.

What types of transactions are covered under Reg E?

Multiple types of electronic fund transfers are protected under Reg E, including the following:

• ATMs.
• Debit cards.
• Direct deposit.
• Electronic checks.
• Internet EFTs.
• Pay-by-phone transfers.
• Credit card only when using EFT functions.

Does EFTA apply to business accounts?

It doesn’t apply to business accounts, including business checking and business savings accounts. And it doesn’t cover credit cards either. Credit cards, however, are protected under the Fair Credit Billing Act, which outlines your rights and responsibilities for disputing unauthorized charges.

What is EFTA regulation E?

Regulation E implements the Electronic Fund Transfer Act (EFTA), which establishes a basic framework of the rights, liabilities, and responsibilities of participants in the electronic fund and remittance transfer systems.

Who is subject to regulation E?

Regulation E applies to all persons, including offices of foreign financial institutions in the United States, that offer EFT services to residents of any state, and it covers any account located in the United States through which EFTs are offered to a resident of a state, no matter where a particular transfer occurs …

What is EFT in simple words?

Electronic Funds Transfer (EFT) is the process by which a user of one bank can transfer money from their account to another by way of payment.

Do banks charge for EFT?

External transfers are free at some banks, and cost from $3 to $10 at others.

Are internal transfers covered by Reg E?

A transfer that the consumer initiates by telephone is covered by Regulation E if the transfer is made under a written plan or agreement between the consumer and the financial institution making the transfer.