The EFTA: Consumer Rights Against Unauthorized Bank Transactions

Worried Man In Grey Shirt Holding Bank Card

Have you had trouble getting reimbursed by your bank for account transactions you didn't make or authorize?

Most of us have experienced something like this: You look through your account statement and find some transfers or cash withdrawals that you did not make. You investigate it and discover that, indeed, these transactions are unauthorized. So you immediately file a report with the bank and hope they will reimburse you for these unauthorized account transactions you did not make.

But what if the bank chooses not reimburse you for these transactions? Do you have any rights or any legal recourse to make sure you can recover the funds taken from your account without your authorization?

The Electronic Funds Transfer Act may be a resource available to you.

The Electronic Funds Transfer Act (EFTA) ,15 U.S.C. 1693 et seq., is a federal statute implemented to protect consumers in the arena of electronic funds transfers (EFTs) which includes a whole array of consumer bank account transactions done electronically. The EFTA protects consumers in ATM transfers, cash withdrawals, point-of-sale transactions, automated bill pay plans and other EFTs.

Important things to note about the EFTA

Although the EFTA provides important protections for consumers, there are crucial considerations to access various protections and remedies offered by the EFTA. When filing a notice with the bank for reimbursement of an unauthorized transaction, it is important to note:

  • Timely filing is critical: There are limits within which customers must file for reimbursement within a specified time limit. This filing puts the bank on notice that it needs to conduct a reasonable investigation and provide credit within a legally established timeline. This filing also limits the customer’s potential liability. In other words, don't hesitate to let the bank know immediately of any unauthorized transaction.
  • File Your Claim In Writing: While phone calls are quick, writing to inform the bank about your loss of funds due to an unauthorized transaction is preferred to access potential remedies offered by the EFTA.
  • You could recover more than what you’ve lost: In addition to the funds you lost as a result of an unauthorized transaction, the EFTA provides potential recovery up to $1,000 in statutory damages and up to treble actual damages (up to three times the amount of actual damages).
  • Experience Matters:  At Manfred, APC, we've successfully represented clients to help them recover unreimbursed bank account funds that were the target of unauthorized activity.

Don't hesitate to reach out to us to discuss and evaluate your potential claims and rights arising out of the EFTA.

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