§ 1693h. — Liability of financial institutions.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 15USC1693h]
TITLE 15--COMMERCE AND TRADE
CHAPTER 41--CONSUMER CREDIT PROTECTION
SUBCHAPTER VI--ELECTRONIC FUND TRANSFERS
Sec. 1693h. Liability of financial institutions
(a) Action or failure to act proximately causing damages
Subject to subsections (b) and (c) of this section, a financial
institution shall be liable to a consumer for all damages proximately
caused by--
(1) the financial institution's failure to make an electronic
fund transfer, in accordance with the terms and conditions of an
account, in the correct amount or in a timely manner when properly
instructed to do so by the consumer, except where--
(A) the consumer's account has insufficient funds;
(B) the funds are subject to legal process or other
encumbrance restricting such transfer;
(C) such transfer would exceed an established credit limit;
(D) an electronic terminal has insufficient cash to complete
the transaction; or
(E) as otherwise provided in regulations of the Board;
(2) the financial institution's failure to make an electronic
fund transfer due to insufficient funds when the financal \1\
institution failed to credit, in accordance with the terms and
conditions of an account, a deposit of funds to the consumer's
account which would have provided sufficient funds to make the
transfer, and
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\1\ So in original. Probably should be ``financial''.
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(3) the financial institution's failure to stop payment of a
preauthorized transfer from a consumer's account when instructed to
do so in accordance with the terms and conditions of the account.
(b) Acts of God and technical malfunctions
A financial institution shall not be liable under subsection (a)(1)
or (2) of this section if the financial institution shows by a
preponderance of the evidence that its action or failure to act resulted
from--
(1) an act of God or other circumstance beyond its control, that
it exercised reasonable care to prevent such an occurrence, and that
it exercised such diligence as the circumstances required; or
(2) a technical malfunction which was known to the consumer at
the time he attempted to initiate an electronic fund transfer or, in
the case of a preauthorized transfer, at the time such transfer
should have occurred.
(c) Intent
In the case of a failure described in subsection (a) of this section
which was not intentional and which resulted from a bona fide error,
notwithstanding the maintenance of procedures reasonably adapted to
avoid any such error, the financial institution shall be liable for
actual damages proved.
(d) Exception for damaged notices
If the notice required to be posted pursuant to section
1693b(d)(3)(B)(i) of this title by an automated teller machine operator
has been posted by such operator in compliance with such section and the
notice is subsequently removed, damaged, or altered by any person other
than the operator of the automated teller machine, the operator shall
have no liability under this section for failure to comply with section
1693b(d)(3)(B)(i) of this title.
(Pub. L. 90-321, title IX, Sec. 910, as added Pub. L. 95-630, title XX,
Sec. 2001, Nov. 10, 1978, 92 Stat. 3735; amended Pub. L. 106-102, title
VII, Sec. 705, Nov. 12, 1999, 113 Stat. 1465.)
Amendments
1999--Subsec. (d). Pub. L. 106-102 added subsec. (d).
Section Referred to in Other Sections
This section is referred to in sections 1693c, 1693m of this title.
