Legislation Would Stop Frivolous ATM Disclosure Lawsuits (Misc News: April 18, 2012)
Legislation that would ease current ATM fee disclosure regulations has been introduced in the U.S. House.
According to News Now, CUNA President/CEO Bill Cheney said the measure “will protect credit unions and other ATM operators from frivolous lawsuits while at the same time maintaining important consumer protections.
The bill, H.R. 4367, was introduced by Reps. Blaine Luetkemeyer, R-Mo., and David Scott, D-Ga., on Tuesday.
Regulation E requires credit unions and other financial institutions that provide ATM services to display a notice on the ATM that a fee will be charged. More detailed ATM fee information must also be provided before the transaction is completed, either by showing it on the ATM's screen or providing the ATM user with a small printed disclosure before the consumer is committed to paying the fee.
Under the legislation, ATMs would only be required to display the ATM disclosures on a screen, and give ATM users the choice of opting in to such a fee. The physical ATM fee disclosure notice requirement would be eliminated.
ATM disclosure requirements have caused issues for credit unions and other financial institutions. Credit unions have told CUNA that outside notices on ATMs are, in some cases, being intentionally removed or destroyed, without the financial institution's knowledge. Pictures are then taken of the ATM to show noncompliance. Some ATM users may then use the photos as evidence of apparent noncompliance and as grounds for lawsuits, and the number and cost of these lawsuits continues to climb. CUNA recently estimated that the total number of these lawsuits could be in the hundreds.
Cheney thanked the congressmen for offering the legislation, calling the bill common sense legislation that will reduce regulatory burden without harm to ATM users.
The lawsuits are on the increase, with a rash of them recently being filed on the West Coast, News Now reported in a separate story.