Electronic Funds Transfer, EFT Payment Procedure, EFT Services, consumers, Electronic Funds Transfer Agreement

Electronic Transfers transfer Policy

An "electronic fund transfer" is a transfer of funds which is initiated electronically rather than with a paper instrument and which debits or credits an account. "Initiated electronically" means by electronic terminal, telephone, computer, or magnetic tape. Examples of EFTs are point of sale transfers; automated teller machine (ATM) transfers; direct deposits; preauthorized withdrawals; transfers initiated by telephone; and transfers resulting from debit card transactions, whether or not initiated through an electronic terminal.

Electronic Check Conversions

Addendum to Electronic Funds Transfers Disclosures and Agreement states: You have authorized a one-time electronic fund transfer from your share draft account by using the information from your share draft to initiate an electronic funds transfer. This transaction is covered by Regulation E, and it is covered by the Electronic Funds Transfer Disclosure and Agreement.

So what does that mean?

If you pay a merchant with a share draft (check), you may be authorizing that merchant to convert the check to an electronic fund transfer. This often occurs when the merchant scans your check and then returns it to you. You may also be authorizing the merchant to electronically debit your account for returned check fees. You are considered to have authorized the electronic funds transfer if you complete the transaction after being told (orally or by posted notice) that the transfer may be processed electronically or if you sign a written authorization.

Moree infoabout Electronic Transfers Policy >>

The Fair Credit Billing Act and The Electronic Fund Transfer Act

The Fair Credit Billing Act (FCBA) applies to "open end" credit accounts, such as credit cards, and revolving charge accounts - such as department store accounts and overdraft checking accounts. It does not cover installment contracts - loans or extensions of credit you repay on a fixed schedule, such as a car or home equity loan. The Electronic Fund Transfer Act applies to electronic fund transfers, such as those involving automatic teller machines, point-of-sale debit transactions, and other electronic banking transactions. Both acts are very similar in the rights they give to consumers.

What types of disputes are covered?

(1) Unauthorized charges (Federal law limits your responsibility for unauthorized charges to $50);

(2) Charges that list the wrong date or amount;

(3) Charges for goods and services you didn't accept or weren't delivered as agreed;

(4) Math errors;

(5) Failure to post payments and other credits, such as returns;

(6) Failure to send bills to your current address - provided the creditor receives your change of address, in writing, at least 20 days before the billing period ends .

(7) Charges for which you ask for an explanation or written proof of purchase along with a claimed error or request for clarification.

To take advantage of the law's consumer protections, you must:

Write to the creditor at the address given for "billing inquiries," not the address for sending your payments, and include your name, address, account number and a description of the billing error. Send your letter so that it reaches the creditor within 60 days after the first bill containing the error was mailed to you. You should also send your letter by certified mail, return receipt requested, so you have proof of what the creditor received. Include copies (not originals) of sales slips or other documents that support your position. Keep a copy of your dispute letter. Sample letter:

"I am writing to dispute a billing error in the amount of $______on my account. The amount is inaccurate because (describe the problem). I am requesting that the error be corrected, that any finance and other charges related to the disputed amount be credited as well, and that I receive an accurate statement.

Enclosed are copies of (use this sentence to describe any enclosed information, such as sales slips, payment records) supporting my position. Please investigate this matter and correct the billing error as soon as possible."

The creditor must acknowledge your complaint in writing within 30 days after receiving it, unless the problem has been resolved. The creditor must resolve the dispute within two billing cycles (but not more than 90 days) after receiving your letter.

What if the bill is correct?

If the creditor's investigation determines the bill is correct, you must be told promptly and in writing how much you owe and why. You may ask for copies of relevant documents. At this point, you'll owe the disputed amount, plus any finance charges that accumulated while the amount was in dispute. You also may have to pay the minimum amount you missed paying because of the dispute.

If you disagree with the results of the investigation, you may write to the creditor, but you must act within 10 days after receiving the explanation, and you may indicate that you refuse to pay the disputed amount. At this point, the creditor may begin collection procedures. However, if the creditor reports you to a credit bureau as delinquent, the report also must state that you don't think you owe the money. The creditor must tell you who gets these reports.

More info about electronic fund transfer>>

Electronic Funds Transfer Act

Electronic Funds Transfer (EFT) is a system of transferring money from one bank account directly to another without any paper money changing hands. One of the most widely-used EFT programs is Direct Deposit, in which payroll is deposited straight into an employee's bank account, although EFT refers to any transfer of funds initiated through an electronic terminal, including credit card, ATM, Fedwire and point-of-sale (POS) transactions. It is used for both credit transfers, such as payroll payments, and for debit transfers, such as mortgage payments.

Transactions are processed by the bank through the Automated Clearing House (ACH) network, the secure transfer system that connects all U.S. financial institutions. For payments, funds are transferred electronically from one bank account to the billing company's bank, usually less than a day after the scheduled payment date.

The growing popularity of EFT for online bill payment is paving the way for a paperless universe where checks, stamps, envelopes, and paper bills are obsolete. The benefits of EFT include reduced administrative costs, increased efficiency, simplified bookkeeping, and greater security. However, the number of companies who send and receive bills through the Internet is still relatively small.

The U.S. Government monitors EFT compliance through Regulation E of the Federal Reserve Board, which implements the Electronic Funds Transfer Act (EFTA). Regulation E governs financial transactions with electronic payment services, specifically with regard to disclosure of information, consumer liability, error resolution, record retention, and receipts at electronic terminals.

More about electronic funds transfe policies info>>

Electronic Funds Transfers Agreement and Disclosure

The Electronic Funds Transfer Agreement is the contract which covers your and our rights and responsibilities concerning the electronic funds transfer ("EFT") services offered to you by North Shore Health System Federal Credit Union ("Credit Union"). In this Agreement, the words "you" and "yours" mean those who sign the application or account card as applicants, joint owners, or any authorized users. The words "we", "us", and "our" mean the Credit Union. The word "account" means any one or more share and share draft accounts you have with the Credit Union. Electronic funds transfers are electronically initiated transfers of money from your account through the electronic transfer services described below. By signing an application or account card for EFT services, signing your Card, or using any service, each of you, jointly and severally, agree to the terms and conditions in this Agreement and any amendments for the EFT services offered.

1. EFT Services. If approved, you may conduct any one or more of the EFT services offered by the Credit Union.

a. ATM. You may use your Card and PIN (Personal Identification Number) in automated teller machines of the Credit Union, NYCE, The Exchange, American Express, CU24, Member Access, TX, Plus Networks, and such other machines or facilities as the Credit Union may designate. At the present time, you may use your Card to:

• Withdraw funds from your share and share draft accounts.
• Transfer funds from your share and share draft accounts.
• Obtain balance information for your share and share draft accounts
• Make POS (Point-of-Sale) transactions with your Card and PIN (Personal Identification Number) to purchase goods or services at POS terminals that carry NYCE, The Exchange, American Express, CU24, Member Access, TX, Plus network logo(s).

The following limitations on the frequency and amount of ATM transactions may apply:

• There is no limit on the number of cash withdrawals you may make in any one day.
• You may withdraw up to a maximum of $503 in any one day, if there are sufficient funds in your account.
• There is no limit on the number of POS transactions you may make in any one day.
• You may purchase up to a maximum of $503 from POS terminals per day, if there are sufficient funds in your account.
• You may transfer up to the available balance in your accounts at the time of the transfer.
• See Section 2 for transfer limitations that may apply to these transactions.

b. VISA Check Card. You may use your Card to purchase goods and services any place your Card is honored by participating merchants. Funds to cover your Card purchases will be deducted from your share draft account. If the balance in your account is not sufficient to pay the transaction amount, the credit union will pay the amount and treat the transaction as a request to transfer funds from other deposit accounts, approved overdraft protection accounts or loan accounts that you have established with the Credit Union. If you initiate a transaction that overdraws your Account, you agree to make immediate payment of any overdrafts together with any service charges to the Credit Union. In the event of repeated overdrafts, the Credit Union may terminate all services under this Agreement. You may use your Card and PIN (Personal Identification Number) in automated teller machines of the Credit Union, NYCE, The Exchange, American Express, CU24, Member Access, TX, Plus Networks, and such other machines or facilities as the Credit Union may designate. At the present time, you may also use your Card to:

• Withdraw funds from your share draft accounts.
• Make POS (Point-of-Sale) transactions to purchase goods and services at merchants that accept Visa.
• Order goods or services by mail or telephone from places that accept Visa.

The following limitations on the frequency and amount of ATM/VISA Check Card transactions may apply:

• There is no limit to the number of VISA Check Card purchases you make per day.
• Purchase amounts are limited to the amount in your account.
• There is no limit to the number of cash withdrawals you may make in any one day from an ATM machine.
• You may withdraw up to a maximum of $503 in any one day from an ATM machine, if there are sufficient funds in your account.
• You may purchase up to a maximum of $503 from POS terminals per day, if there are sufficient funds in your account with your ATM card.
• You may transfer up to the available balance in your accounts at the time of the transfer.
• See Section 2 for transfer limitations that may apply to these transactions.

Preauthorized EFTs.

• Direct Deposit. Upon instruction of (i) your employer or (ii) the Treasury Department or (iii) other financial institutions, the Credit Union will accept direct deposits of your paycheck or of federal recurring payments, such as Social Security, to your share and share draft account.
• Preauthorized Debits. Upon instruction, we will pay certain recurring transactions from your share and share draft account.
• See Section 2 for transfer limitations that may apply to these transactions.

2. Transfer Limitations.

• For all share accounts, no more than six (6) preauthorized, automatic, or telephone transfers and withdrawals may be made from these accounts to another account of yours or to a third party in any month, and no more than three (3) of these six (6) may be made by check, draft, or access card to a third party. If you exceed these limitations, your account may be subject to a fee or be closed.

3. Conditions of EFT Services.

a. Ownership of Cards. Any Card or other device which we supply to you is our property and must be returned to us, or to any person whom we authorize to act as our agent, or to any person who is authorized to honor the Card, immediately according to instructions. The Card may be repossessed at any time at our sole discretion without demand or notice. You cannot transfer your Card or account to another person.

Garlic Info | For Islamorada | Corporate Portal | Scripophily Web | Fresh Flowers |

b. Honoring the Card. Neither we nor merchants authorized to honor the Card will be responsible for the failure or refusal to honor the Card or any other device we supply to you. If a merchant agrees to give you a refund or adjustment you agree to accept a credit to your account in lieu of a cash refund.

c. Security of Access Code. You may use one or more access codes with your electronic funds transfers. The access codes issued to you are for your security purposes. Any codes issued to you are confidential and should not be disclosed to third parties or recorded on or with the Card. You are responsible for safekeeping your access codes. You agree not to disclose or otherwise make your access codes available to anyone not authorized to sign your accounts. If you authorize anyone to use your access codes, that authority shall continue until you specifically revoke such authority by notifying the Credit Union. You understand that any joint owner you authorize to use an access code may withdraw or transfer funds from any of your accounts. If you fail to maintain the security of these access codes and the Credit Union suffers a loss, we may terminate your EFT services immediately.

d. Joint Accounts. If any of your accounts accessed under this Agreement are joint accounts, all joint owners, including any authorized users, shall be bound by this Agreement and, alone and together, shall be responsible for all EFT transactions to or from any share and share draft or loan accounts as provided in this Agreement. Each joint account owner, without the consent of any other account owner, may, and hereby is authorized by every other joint account owner to, make any transaction permitted under this Agreement. Each joint account owner is authorized to act for the other account owners, and the Credit Union may accept orders and instructions regarding any EFT transaction on any account from any joint account owner.

4. Fees and Charges. There are certain charges for electronic funds transfer services. From time to time, the charges may be changed. We will notify you of any changes as required by applicable law. If you use an ATM that is not operated by us, you may be charged an ATM surcharge by the ATM operator or an ATM network utilized for such a transaction. The ATM surcharge will be debited from your account if you elect to complete the transaction.

More info about Electronic Funds Transfers Agreement and Disclosure

Preventing EFT Fraud

By John E. Humphries, Jr., CISA, CISSP, GSEC Volume 4, 2003

During the past two years, numerous stories have surfaced in the news pertaining to fraud and unethical conduct in the corporate world. White-collar crime seems to be running rampant throughout the world. Fraud costs American companies US $400 billion per year, according to the Association of Certified Fraud Examiners. In Britain, the Telecoms UK Fraud Forum estimates US $1.575 billion is lost annually to telecom fraud.1 One can only imagine the annual impact that fraud has on corporations globally.

Another alarming trend involves the use of computers and their use in committing fraud and misconduct. The scams perpetrated by computer fraud offenders often are elusive, creative, complex and sometimes include a thorough knowledge of IT and business processes.

The electronic funds transfer (EFT) process is a widely used technical solution deployed by corporations throughout the world to transmit payment instructions to financial institutions for payment of employees, companies and/or other entities. Often, companies transmit large sums of money electronically to the bank with the click of a mouse. Upon completing EFT reviews, one often notes ineffective, alarming technical configurations, which easily could provide an avenue for fraudulent activity. This article will discuss EFT from an IT and process orientation perspective, and it will examine how to prevent EFT fraud from occurring at an organization, with the intention keeping a company out of the headlines. Although technical configurations exist.

EFT Process

The EFT process includes the following steps:

• Employee uses enterprise resource planning (ERP) graphical user interface (GUI) to request the generation of an EFT file.
• The request is received by the ERP system, and the EFT program executes
• EFT data are extracted from the ERP database and incorporated into a flat-text file
• This file is saved to a secure directory located on the ERP system or network server
• An employee copies the EFT file from the ERP system to a diskette located in the network workstation.
• An employee inserts the diskette into a standalone EFT workstation where the EFT application resides.
• The EFT file is transmitted to a bank as an encrypted flat-text file.
• The bank system receives the EFT file, and the back-end systems process payment instructions.

Although the term "funds transfer" has various meanings, this article specifically will consider the EFT process. The concepts discussed will outline key risks and compensating steps designed to assist the reader in evaluating and improving his/her company's EFT process.

Motivations of EFT Fraud

The motives behind EFT fraud are vast and complex. Some of the common factors include a significant financial profit, a desire to master the EFT system or process, the thrill of the deed and employee revenge

Large amounts of money often are transmitted over EFT networks during a single EFT file transmission. By fraudulently altering payment instructions (e.g., bank account details or currency amounts) in the EFT process, an individual potentially could steal large sums of money. Although it is difficult, if not impossible, to obtain accurate statistics on EFT fraud, one could suggest that companies lose huge sums each year due to fraudulent EFT payment instructions. To avoid media attention and a potential decline in share price, most companies prefer not to go public with embarrassing information pertaining to fraudulent activity.

Hackers commonly penetrate systems as a recreational activity. When asked about their reasons for compromising a computer or introducing a virus on the Internet, hackers often claim that their intentions were not to cause harm but to see if they could do it. Similarly, the intentions of those who commit EFT fraud may be to determine whether they can perfect the EFT system and/or process. EFT crime offers an intellectual challenge, which is as attractive to some as the opportunity for financial gain

In today's corporate world, mergers, acquisitions and streamlining are common occurrences. Positions sometimes become redundant, and employees consequently lose their jobs. Such an environment increases the risk of disgruntled employees and fraudulent activity. For example, an employee at the EFT controls could anticipate a loss of employment and retaliate against the company by releasing a fraudulent EFT payment to his/her own bank account.

Steps For Prevention

Prior to defining the steps for preventing EFT fraud, it is important to outline common risks associated with the EFT process. Based on the solution depicted in figure 1, figure 2 presents risks that could increase a company's vulnerability to fraudulent activity.

To reduce the risk of fraudulent activity, several controls can be integrated into the EFT processing environment. However, the controls should not be considered a cure-all.

Define the EFT Process and Control Points

It is important to understand the EFT solution and process from beginning to end. To facilitate this understanding, a useful exercise involves defining the EFT process and procedures used to transmit EFT files to the financial institution. During this process, it also is useful to identify risks, vulnerabilities and control points. Technical specifications often provide an excellent starting point. In addition, it is helpful to conduct an informal workshop with all necessary employees involved in EFT processing (e.g., finance, payroll, IT). Any employees involved in EFT manual and automated processes and supporting infrastructure should be consulted. Upon identification and definition of the EFT process, risks, vulnerabilities and control points should be outlined on paper to aid in understanding all parties involved.

Define EFT Policies and Procedures

Finance managers aim to prevent their employees from committing illegal activities. The solutions include commonsense policies and procedures pertaining to auditing regularly, reconciling promptly, screening employees carefully and requiring two approvals prior to transferring funds

To ensure consistency of EFT practices, it is important to establish formal procedures. All employees involved should be educated on the procedures. In addition, it is necessary to establish an EFT policy which defines acceptable practices and implications of noncompliance. Prior to participating in the EFT process, employees should be required to agree formally to the conditions stated in the policy. The criticality and integrity of the EFT process must be emphasized in the policy. Companies often fail to establish EFT policies and procedures, which, in the event of illegal activity by employees, could make prosecution more difficult.

Ensure Physical Security Surrounding All EFT Components

Physical security surrounding the EFT hardware and software components cannot be emphasized enough. Entire solutions could be compromised easily because of an outright disregard for physical security. Frequently, companies install a financial institution's EFT software on a standalone workstation. If this workstation lacks physical security, the potential of fraudulent activity dramatically increases.

More info about Preventing EFT Fraud

Look Moissanite | Bedwetting Faq | Pudong Hotels | Best Card Processing | Rogaine Web |

Electronic Funds Transfers your Rights and Responsibilities

The Electronic Funds Transfers we are capable of handling are indicated below, some of which may not apply to your account. Please read this disclosure carefully because it tells you your rights and obligations for these transactions listed. You should keep this notice for future reference.

PREAUTHORIZED CREDITS: You may make arrangements for certain direct deposits to be accepted into your checking accounts or savings accounts.

PREAUTHORIZED PAYMENTS AND WIRE TRANSFERS: You may make arrangements to pay certain recurring bills or initiate wire transfers from your checking account(s) or savings account(s). If your payment order identifies an intermediate bank, beneficiary bank, or beneficiary by name and number, we may, and every receiving or beneficiary bank may, rely upon the identifying number rather than the name to make payment, even if the number identifies an intermediate bank, person or account different than the bank or beneficiary identified by name. We are not responsible, nor is any receiving or beneficiary bank, for determining whether the name and identifying number refer to the same bank or person. We may honor overdrafts on your account when a transaction is initiated by preauthorized payment or wire transfer.

TELEPHONE ACCESS PLAN TRANSACTIONS: You may access your account by telephone using your personal identification number (PIN), touch tone phone and account number(s) to:

• transfer funds from checking accounts, savings accounts or lines of credit to checking accounts, savings accounts or loan accounts
• get balance information about checking accounts, savings accounts, lines of credit or certificate of deposit accounts
• get withdrawal history about checking accounts or savings accounts
• get deposit history about checking accounts or savings accounts

You may access your account for telephone transactions at the following number: (888) 873-3424. You may call 24 hours a day. We may honor overdrafts on your account when a transaction is initiated by telephone access. Please also see the Transfer Limitations section of the Deposit Account Terms and Conditions regarding limitations that apply to telephone transactions.

ATM CARD TRANSACTIONS: You may access your account by ATM using your ATM card and your personal identification number (PIN) to:

• deposit funds to checking accounts or savings accounts
• withdraw cash from checking accounts or savings accounts
• get balance information about checking accounts or savings accounts

DEBIT CARD POINT-OF-SALE TRANSACTIONS: You may access your checking account by debit card to:

• purchase goods in person or by phone
• pay for services in person or by phone

Point-of-sale transactions require you to enter your PIN. Other debit card purchases may require you to sign a receipt. We may honor overdrafts on your account when the transaction is initiated by a debit card transaction. Please also see the Transfer Limitations section of the Deposit Account Terms and Conditions regarding limitations that apply to debit card transactions.

More info about Electronic Funds Transfers