RSS Feed
|
|
|||||
|
for larger version       Notes On Consumer Affairs
Debit card transactions are regulated by the federal Electronic Funds Transfer Act (EFTA). The Act and its implementing regulations require financial institutions to provide new cardholders with an initial disclosure of the terms and conditions of debit card services, the consumer's liability for unauthorized use of the card, the types of transfers the consumer may make, and any fees charged by the issuer. Make sure that you read this disclosure thoroughly, and that you understand your rights. One of the most important statements in the initial disclosure involves a debit cardholder's liability for unauthorized use of the card, which differs from those provided to credit cardholders. Many consumers are unaware that, unlike victims of credit card fraud - who are liable for a maximum of $50 - victims of debit card fraud can be held liable for the entire fraudulent transfer if they fail to promptly notify their bank. If your debit card is lost or stolen, it is imperative that you report such occurrence to your bank as soon as possible. If you report the loss or theft within two business days, you will only be liable for $50. However, if you notify the bank after two business days, but before 60 days have passed since you discovered your card was missing, you could be responsible for up to $500. If you fail to report a loss within 60 days, you may be liable for the entire amount of the unauthorized transfer. In this case, you could lose all of the money in your account. Additionally, in instances of debit card fraud, money is immediately taken from the victim's account, which can lead to bounced checks and overdraft fees. In order to minimize the damage that debit card fraud can cause, it is important to monitor your checking account regularly and report any unauthorized charges to the card issuer immediately. Some banks voluntarily cap debit cardholder's liability at $50 for certain transactions, even if you fail to report the loss or theft in a timely fashion. Ask your card issuer about its liability policy. Debit cardholders should also be aware of another significant difference between debit cards and credit cards. Unlike credit cards, consumers using their debit card to purchase gasoline, lodging, and rental vehicles, may find that their bank has placed a "hold" on their account for an amount above the purchase price in order to ensure payment. These additional withdrawals - as high as $75 - can take several days to clear, leaving consumers at risk of drawing upon insufficient funds and bouncing checks. In order to ensure that consumers filling up at the pump are informed of this practice, the Committee recently reported A.6853 (Nolan). This bill would require gas stations that allow customers to use a debit card to post a notice informing customers that their bank may place a hold against their account. Ask your debit card issuer about its hold policy.
To learn more about consumer protections afforded to debit cardholders, please visit the Federal Trade Commission's website at www.ftc. gov, or call their toll-free number 1-877-FTCHELP (1-877-382-4357). Also consider contacting your debit card issuer to learn more about the protections that they offer to cardholders.
|
|
||||
