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Government watch
Reg. E Error Resolution: Everyone’s Business
Reg. e eRRoR Resolution flow chaRt
Was the error reported verbally?
Customer reported via written notice of potential error? (No later than 60 days after transmittal of statement where error first appeared.)
Yes
no
no
Yes
no
Yes
Customer complied with request to document error in writing within 10 business days?
Can the error be resolved within 10 business days or 20 business days for new accounts?
Determine if error has occurred within 10 business days of notice. No provisional credit is required. If needed, extend investigation period up to 45 calendar days. Extend up to 90 calendar days for POS debit card transactions, transactions initiated from outside the U.S. or new account trans- action that occured within 30 days of a new account first deposit.
Within 3 business days after concluding no error has occurred but not later than 45 calendar days after receiving the claim (or 90 days for POS debit card transactions, transactions initiated from outside the U.S. or new accounts), provide consumer a written explanation of findings. Explain customer’s rights to request documents used to make determination.
no Yes
If dispute cannot be resolved within the applicable 10 or 20 day period, provisionally credit consumer’s account with disputed amount plus any interest lost and/or fees charged as
a result of the error. Within 2 business days after credit, notify consumer verbally or in writing of provisional credit. Include date and amount, plus notification that customer has full use of amount until bank determines if error occurred. Extend up to 90 calendar days for POS debit card transactions, transactions initiated from outside the U.S. or new accounts.
Yes
Did an error occur?
no
Correct error within 1 business day and notify customer in writing within 3 business days of completing in- vestigation. If applicable, credit interest and refund any fees im- posed as a result of the error. If provisionally credited, confirm or adjust final amount and notify customer that provisional credit is final. Final resolution cannot be reversed, even if more information later proves the error did not occur.
If no error occurred, debit the consumer’s account for amounts provisionally credited, if any, and provide written explanation of your findings. Advise consumer within 3 business days of completing investigation: (i) date and amount of debit for reversal of provisional credit, if applicable; (ii) the bank will honor any pre- authorized transfers, checks, and drafts payable to third parties for 5 business days after sending the notice up to amount of provisional credit, charging no fees for resulting overdraft; and, (iii) remind consumer of right to request the documents the bank relied on to make its determination.
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promptly and communicate with the consumer in accordance with the process outlined in the card- holder agreement. Although provisional credit may not apply, the payments networks’ charge- back obligations may.
3 tImIng matteRs
Compliant Reg. E error resolution is technical in the sense that time frames for certain actions are spe- cific. There’s no wiggle room. For
example, the 10 business-day per- iod to resolve an alleged error starts when the consumer first notifies the party identified in the cardholder agreement. If the consumer notifies you of an error at 11:59 PM on Mon- day, Nov. 3, the notice of error is
source: Patti Joyner Blenden, Founder and President, Financial Solutions. Reprinted with permission.