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Electronic Fund Transfer Act (EFTA)

1978

15 U.S.C. § 1693 et seq.

📌 Link to the Text of the Act

Read the statute (15 U.S.C. § 1693 et seq.)

📌 Why It Was Done

The EFTA was enacted to protect consumers in electronic banking transactions, ensuring fair treatment, clear disclosures, and protection against unauthorized transfers.

📌 Pre-existing Law or Constitutional Rights

Before EFTA, consumer protections for electronic payments (ATM, debit cards, direct deposit) were minimal. Traditional banking laws didn’t account for new technologies.

📌 Overreach or Proper Role?

Supporters say it gave consumers confidence in electronic banking. Critics argue it imposed additional compliance burdens on banks and limited flexibility in resolving disputes.

📌 Who or What It Controls

  • •
    Financial institutions offering electronic fund transfer services
  • •
    Consumers (gain rights to error resolution and liability limits for fraud)
  • •
    Merchants (indirectly affected through debit card and EFT systems)

📌 Key Sections / Citations

  • •
    15 U.S.C. § 1693f: Error resolution procedures
  • •
    15 U.S.C. § 1693g: Limits on consumer liability for unauthorized transfers
  • •
    15 U.S.C. § 1693h: Disclosure requirements

📌 Recent Changes or Live Controversies

  • •
    Regulation E (CFPB) implements EFTA rules
  • •
    Ongoing issues include peer-to-peer payment apps (Venmo, Zelle, CashApp)
  • •
    Rising disputes over liability for fraud in electronic transfers

📌 Official Sources