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35.CCS
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1992-12-25
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LOST OR STOLEN DEBIT CARDS
In the world of debit cards, "unauthorized use" or "lost and
stolen" are treated the same. A consumer is responsible for
notifying their financial institution within two days of
discovering the loss or theft of their debit card. If they
don't, they could be held liable for the bank's losses for
up to $500 per account. Fortunately for the consumer, the
bank must prove that their losses were a direct result of
the consumer's failure to notify them.
If a consumer detects unauthorized transfers on their
periodic statement, they have 60 days from the statement
date to notify their financial institution. Still, the
consumer's total liability is only $50 per account.
In both cases, the law is quite vague and favors the
consumer. The burden of proving the consumer's negligence
falls on the financial institution. And the law gives the
consumer the right to introduce extreme circumstances.
For example: A consumer leaves the country for three months.
Upon returning, they discover $2,000 in unauthorized
withdrawals have been made using their debit card. Here, the
consumer may not be held liable for the unauthorized use and
the financial institution may not take the $2,000 from the
consumer's account.
As with credit cards, it is a good practice to keep a record
of account numbers, as well as a number to call in case a
card is lost, stolen or being used without authorization.
The best insurance is to notify the financial institution as
soon as a problem is discovered.
* * * End of LOST OR STOLEN DEBIT CARDS * * *