The Catholic University of America

Summary of Federal Laws

Miscellaneous Laws that Might Apply

Compliance Partners

Associate VP for Campus Services

Electronic Fund Transfers, Regulation E

15 U.S.C. § 1693b; 12 C.F.R. § 205.1 et seq.

This law is designed to protect consumers making electronic fund transfers. The term "electronic fund transfer" (EFT) generally refers to a transaction initiated through an electronic terminal, telephone, computer, or magnetic tape that instructs a financial institution either to credit or to debit a consumer's asset account. 

The Electronic Funds Transfer Act (also known as Regulation E) was adopted in 1978 as an add on to the Consumer Credit Protection Act. Regulation E is issued by the Board of Governors of the Federal Reserve System. The law and regulation establish the basic rights, liabilities and responsibilities of consumers who use electronic fund transfer services and of financial institutions that offer these services. A question has been raised as to whether or not student purchasing cards or other types of stored value cards issued by universities must meet the requirements of Regulation E. 

The Federal Reserve Board publishes a Compliance Guide for Small Entities to Regulation E. A summary of the guide describes the basics of the law. 

Helpful articles on Regulation E have been published in CR80News publications. An August 2003 article entitled Regulation E and Campus Cards: Are hundreds of campus card programs breaking the law? is especially helpful. 

In relevant part this article states the crux of the matter as follows:

If you hold money for others and enable them to electronically instruct that part or all of it be transferred to another party, you must follow specified procedures with regard to how you 1) issue the access device card, 2) hold the individual liable for unauthorized transfers, 3) initially disclose terms and conditions, 4) provide receipts and periodic statements, and 5) resolve errors or discrepancies should they occur.

Campus Student Debit Cards

Text of July 12, 2012 letter from seven U.S. senators to six higher education presidential associations calling attention to a recent report issued by the U.S. PIRG Education Fund entitled “The Campus Debit Card Trap”. 


Consumer Financial Protection Bureau, Request for Information Regarding Financial Products Marketed to Students Enrolled in Institutions of Higher Education (Feb. 2013)

**The newly created CFPB poses a series of questions about campus affinity agreements and other financial products issued to students.

 NACUBO March 18, 2013 Response to CFPB Request on Campus Student Debit Cards and Other Financial Arrangements

Resources

Feb. 2014 GAO Report on College Debit Cards: Actions needed to Address ATM Access, Student Choice, and Transparency

NACUBO Best Practices: Safeguarding Student Finances: Guidance for Campuses Offering Student Debit Card Options December 2012

Regulation E Compliance GuideBoard of Governors of Federal Reserve

FDIC Model Disclosure Clauses and Forms

Goucher College Terms and Conditions of use for the OneCard

 

 

updated 4-16-14 to add GAO report

CCR updated CFR links 6/1/15