Provisional Credit for Error Notice: CRCM Exam Answer
Question
The institution need not provisionally credit the consumer's account if it requires but does not receive written confirmation of oral notice of error or if the error involves an account subject to the margin requirements of ______________.
Answers
Explanations
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A. B. C. D.A
The question pertains to the requirements for the provisional crediting of a consumer's account when an error is reported to the financial institution. This is governed by Regulation E, which implements the Electronic Fund Transfer Act (EFTA).
Under Regulation E, if a consumer reports an error to the financial institution orally, the institution must investigate the error and, if it finds an error, provisionally credit the consumer's account within ten business days of receiving the report. However, there are certain exceptions to this requirement.
One such exception is if the financial institution requires but does not receive written confirmation of the oral report of the error. In such a case, the institution need not provisionally credit the consumer's account. This requirement is set out in Regulation E, Section 1005.11(c)(2)(i).
Another exception is if the error involves an account subject to the margin requirements of Regulation T. Regulation T is a Federal Reserve Board regulation that governs the extension of credit by brokers and dealers. If the error involves an account subject to Regulation T, the institution need not provisionally credit the consumer's account. This requirement is set out in Regulation E, Section 1005.11(c)(2)(ii).
Therefore, the correct answer to the question is A. Regulation T.
