In a speech to the Clearing House in New York, Cordray highlighted unauthorized automated debits and uncertainty about when transactions will be credited or debited as particular challenges. He remarked:
We have seen good practices by some banks and credit unions that have developed screening mechanisms to detect abuse before authorizing charges. But more needs to be done.
In response, ABA VP Steve Kenneally commented:
ACH rules and the CFPB’s own Regulation E provide extensive protections against unauthorized transactions. A consumer who reports unauthorized ACH transactions within 60 days of receiving a statement has no liability.
Cordray also praised the Clearing House’s initiative to develop a real-time payments system. He cautioned that this system should allow faster access to deposited funds, real-time access to balance information and robust protections for unauthorized debits in order “to work for consumers as well as for financial institutions and their commercial clients.”
Read the speech.