Question

Darla had $750 in her checking account when her debit card was stolen. assuming the thief made $525 in purchases with the card, how much could she save by reporting the stolen atm card immediately rather than waiting more than three months before reporting the theft?

Answer 1

Answer: The thief had already made $525 in purchases; however by reporting the loss of the debit card immediately, her loss is limited to $50. Hence she can save $475.

The Electronic Fund Transfer Act (EFTA) limits the loss of funds depending on how quickly loss of card is reported.

If a person reports the loss of the card immediately before unauthorized transactions the debit card holder will not lose anything.

If loss of a debit card is reported within two business days after discovering the theft, the debit card holder will lose a maximum of $50.

If loss of a debit card is reported  after three months of the theft, the debit card holder will be responsible for all the losses arising from unauthorized transactions.