The Federal Reserve used a recent issue of Consumer Compliance Outlook® to highlight the continued importance of compliance with error resolution requirements of the Electronic Fund Transfer Act (EFTA) and Regulation E1.
According to data from the Fed, violations of the EFTA were among the most cited consumer compliance violations in examinations of state member banks in 2022.
Regulation E assigns responsibilities to financial institutions and awards protections to consumers in connection with accounts with electronic fund transfer (EFT) capabilities. EFTs include ACH transfers, POS transfers, and ATM transfers, among many others.
One specific financial institution responsibility is to establish and execute error resolution procedures. Generally, when a consumer asserts an error, the institution has a responsibility to investigate, resolve, and report the outcome of the investigation to the consumer.
According to the Fed, examiners cited violations in connection with the following error resolution requirements:
- Forvis Mazars.
- 1“Top Federal Reserve Compliance Violations in 2022 Under the Fair Credit Reporting Act and the Equal Credit Opportunity Act.” consumercomplianceoutlook.com, Fourth Issue 2023.