The Institution must grant provisional credit to the consumer within 10 business days after the Institution has been informed of an unauthorized transaction on the account. Provisional credit also does not have to be provided unless the notice of error has been provided in writing (i.e. not oral). This does not mean investigation doesn’t start from an oral notification. Below is the regulatory citation:
1005.11(c)(1) (c) Time limits and extent of investigation. (1) Ten-day period. A financial institution shall investigate promptly and, except as otherwise provided in this paragraph (c), shall determine whether an error occurred within 10 business days of receiving notice of error. The institution shall report the results to the consumer within three business days after completing its investigation. The institution shall correct the error within one business day after determining that an error occurred.
(2) Forty-five-day period. If the financial institution is unable to complete its investigation within 10 business days, the institution may take up to 45 days from receipt of a notice of error to investigate and determine whether an error occurred, provided the institution does the following:
- Provisionally credits the consumer’s account in the amount of the alleged error (including interest where applicable) within 10 business days of receiving the error notice.
The previous section defines the “error notice”
1005.11(b) Notice of error from consumer. (1) Timing; contents. A financial institution shall comply with the requirements of this section with respect to any oral or written notice of error from the consumer that:
(i) Is received by the institution no later than 60 days after the institution sends the periodic statement or provides the passbook documentation, required by § 1005.9, on which the alleged error is first reflected.
(ii) Enables the institution to identify the consumer’s name and account number; and
(iii)Indicates why the consumer believes an error exists and includes to the extent possible the type, date, and amount of the error, except for requests described in paragraph (a)(1)(vii) of this section.
(2) Written confirmation. A financial institution may require the consumer to give written confirmation of an error within 10 business days of oral notice. An institution that requires written confirmation shall inform the consumer of the requirement and provide the address where confirmation must be sent when the consumer gives the oral notification.
