Opinion ID: 2976972
Heading Depth: 3
Heading Rank: 1

Heading: The Electronic Funds Transfer Act

Text: The federal government enacted the EFTA as part of the comprehensive Consumer Credit Protection Act (the “CCPA”), Pub. L. No. 95-630 § 2001, 92 Stat. 3641 (1978) (codified as amended at 15 U.S.C. § 1601 et seq.). The EFTA protects individual consumer rights by “provid[ing] a basic framework establishing the rights, liabilities, and responsibilities of participants in electronic fund transfer systems.” 15 U.S.C. § 1693(b). One of the EFTA’s provisions requires that operators of automated teller machines (“ATMs”) provide notice of fees charged to consumers. Specifically, 15 U.S.C. § 1693b(d) states in relevant part: (3) Fee disclosures at automated teller machines (A) In general The regulations prescribed under paragraph (1) shall require any automated teller machine operator who imposes a fee on any consumer for providing host transfer services to such consumer to provide notice in accordance with subparagraph (B) to the consumer (at the time the service is provided) of-- (i) the fact that a fee is imposed by such operator for providing the service; and (ii) the amount of any such fee. (B) Notice requirements
The notice required under clause (i) of subparagraph (A) with respect to any fee described in such subparagraph shall be posted in a prominent and conspicuous location on or at the automated teller machine at which the electronic fund transfer is initiated by the consumer.
The notice required under clauses (i) and (ii) of subparagraph (A) with respect to any fee described in such subparagraph shall appear on the screen of the automated teller machine, or on a paper notice issued from such machine, after the transaction is initiated and before the consumer is irrevocably committed to completing the transaction . . . . C) Prohibition on fees not properly disclosed and explicitly assumed by consumer No. 07-3936 Clemmer v. Key Bank Nat’l Assoc. Page 3 No fee may be imposed by any automated teller machine operator in connection with any electronic fund transfer initiated by a consumer for which a notice is required under subparagraph (A), unless-- (i) the consumer receives such notice in accordance with subparagraph (B); and (ii) the consumer elects to continue in the manner necessary to effect the transaction after receiving such notice. The EFTA defines an “automated teller machine operator” as a person who operates an ATM and “is not the financial institution that holds the account” of the consumer using that ATM. 15 U.S.C. § 1693b(d)(3)(D)(i). The EFTA grants to the Board of Governors of the Federal Reserve System (the “Board”) the authority and responsibility to “prescribe regulations to carry out the purposes” of the act. Id. § 1693b(a). The Board has implemented various administrative regulations codified at 12 C.F.R. § 205 (“Regulation E”). On the issue of ATM notice, Regulation E provides: (b) General. An automated teller machine operator that imposes a fee on a consumer for initiating an electronic fund transfer or a balance inquiry shall: (1) Provide notice that a fee will be imposed for providing electronic fund transfer services or a balance inquiry; and (2) Disclose the amount of the fee. 12 C.F.R. § 205.16. The regulation has different requirements for on-machine and on-screen notices. The on-machine notice must alert a potential consumer that: (i) A fee will be imposed for providing electronic fund transfer services or for a balance inquiry; or (ii) A fee may be imposed for providing electronic fund transfer services or for a balance inquiry, but the notice in this paragraph (c)(1)(ii) may be substituted for the notice in paragraph (c)(1)(i) only if there are circumstances under which a fee will not be imposed for such services . . . . Id. § 205.16(c)(1). The on-screen notice must notify the consumer that a fee will be imposed and the amount of the fee before the consumer commits to paying the fee. Id. § 205.16(c)(2).