What is the Electronic Funds Transfer Act?
The Electronic Funds Transfer Act (EFTA) is a federal law that protects consumers when they transfer money electronically. This law was created in 1978 and is enforced by the Consumer Financial Protection Bureau. The EFTA covers the rights and responsibilities of both the consumer and financial institutions when transferring funds electronically. It outlines the rules that financial institutions must follow when they transfer money, as well as the protection that consumers have when doing so. For example, the EFTA requires that consumers be given the opportunity to cancel certain transfers within a certain time frame. The EFTA also requires all financial institutions to provide customers with information regarding their rights and responsibilities when transferring funds electronically. This includes statements which must be provided regarding the cost of doing so and the terms and conditions associated with the transactions. This helps to ensure that consumers are aware of their rights and are able to make informed decisions when transferring funds electronically. In addition, the EFTA also addresses important consumer protections such as providing liability limits in cases of unauthorized funds transfers, as well as protections from credit card fraud. All of these measures help to ensure that consumers are protected when transferring funds electronically. In Texas, the EFTA is enforced by the Texas Department of Banking and is applicable to all financial institutions in the state. It is important for consumers to understand their rights and responsibilities under the EFTA when transferring funds electronically, in order to protect themselves from any potential fraud or errors.
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