United States District Court, D. Nevada
ORDER (DOCKET NO. 5)
J. KOPPE, UNITED STATES MAGISTRATE JUDGE.
Michael Cifaldo is proceeding in this action pro se
and requested authority pursuant to 28 U.S.C. § 1915 to
proceed in forma pauperis. Docket No. 1. On May 23,
2017, the Court granted Plaintiff's application, and
screened Plaintiff's complaint pursuant to 28 U.S.C.
§ 1915. Docket No. 3. The Court dismissed
Plaintiff's complaint with leave to amend. Id.
The Court identified numerous deficiencies in Plaintiff's
complaint, and provided him an opportunity to cure those
defects. Id. Pending before the Court is
Plaintiff's amended complaint. Docket No. 5.
alleges that, on September 2, 2016, two unauthorized charges
totaling $755.61 were made to his Fidelity Visa Gold Debit
Card while he was asleep. See, e.g., Docket No. 5 at
1-2, 16. Plaintiff further alleges that, on the same day, he
notified Defendant of the charges via telephone. See
Id. at 16. Plaintiff alleges that Defendant
“denied [his] claims without explanation on September
7, 2016.” Id. at 2. Plaintiff further alleges
that, on September 20, 2016, he sent Defendant a letter
requesting all documentation used in its investigation of his
claim. Id. at 2, 16-17. Plaintiff alleges that
Defendant received the letter on September 23, 2016.
Id. Plaintiff alleges that, on October 3, 2016,
Defendant sent him a letter stating that its denial of his
claim was based on verbal information provided to it by the
third party merchant who charged Plaintiff's account.
Id. at 2, 20. Plaintiff further alleges that, on
November 17, 2016, Defendant sent him a second letter, again
denying his claims, and stating that it had subsequently
received documentation from the third party merchant that was
consistent with the verbal information the merchant
previously provided it. Id. at 3, 24.
amended complaint alleges violations of the Electronic Funds
Transfer Act (“EFTA”), 15 U.S.C. §§
1693 et seq. Id. Specifically, Plaintiff
alleges that Defendant violated 15 U.S.C. §§
1693f(a), 1693f(c), 1693f(d), 1693g(a), and 1693g(e).
Id. Plaintiff has addressed the deficiencies the
Court identified in his complaint regarding 15 U.S.C.
§§ 1693d(a), 1693f(d) (regarding his allegation
that Defendant failed to deliver the results of its
investigation within three business days), and 1693g(e) by
removing them from his complaint. Plaintiff has addressed the
deficiencies the Court identified in his complaint regarding
15 U.S.C. §§ 1693f(a) and 1693f(c) by alleging
further facts. Id. at 3-4. However, the Court must
examine whether these facts state a claim against Defendant
under 15 U.S.C. §1693.
EFTA creates a ‘framework [of] rights, liabilities, and
responsibilities of participants in electronic fund transfer
systems.'” Sanford v. MemberWorks, Inc.,
625 F.3d 550, 560 (9th Cir. 2010) (quoting 15 U.S.C. §
1693(b)). “In a basic sense, the EFTA allows consumers
to preauthorize electronic transfers of funds from accounts
they hold at financial institutions.” Camacho v.
JPMorgan Chase Bank, 2015 WL 5262022, at *2 (N.D. Cal.
Sept. 9, 2015) (citing 15 U.S.C. § 1693e). “These
financial institutions must thereafter provide to consumers
documentation evidencing the transfers on a periodic
basis.” Id. (citing 15 U.S.C. § 1693d).
EFTA contains an error resolution process which obligates
consumers to report transfer errors to financial institutions
within 60 days after having been transmitted the written
documentation containing the error.” Id.
(citing 15 U.S.C. § 1693f(a)). “For the purposes
of this provision, an ‘error' includes either an
unauthorized, incorrect or omitted transfer of funds.”
Id. (citing 15 U.S.C. § 1693f(f)).
“Actions against financial institutions for failure to
comply with the EFTA must be brought ‘within one year
from the date of the occurrence of the violation.'”
Id. at *5 (citing 15 U.S.C. § 1693m(g)). With
this framework in mind, the Court addresses in turn each of
the statutory provisions under which Plaintiff attempts to
state a claim for relief.
Plaintiff alleges that Defendant violated 15 U.S.C. §
1693f(a) by exceeding the 10-business-day time limit to
complete its investigation of the disputed transactions.
Docket No. 5 at 3. 15 U.S.C. § 1693f(a) provides that:
If a financial institution, within sixty days after having
transmitted to a consumer documentation pursuant to section
906(a), (c), or (d) (15 USCS § 1693d(a), (c), or (d)) or
notification pursuant to section 906(b) (15 USCS §
1693d(b)), receives oral or written notice in which the
(1) sets forth or otherwise enables the financial institution
to identify the name and account number of the consumer;
(2) indicates the consumer's belief that the
documentation, or, in the case of notification pursuant to
section 906(b) (15 USCS § 1693d(b)), the consumer's
account, contains an error and the amount of such error; and
(3) sets forth the reasons for the consumer's belief
(where applicable) that an error has occurred, the financial
institution shall investigate the alleged error, determine
whether an error has occurred, and report or mail the results
of such investigation and determination to the consumer
within ten business days. The financial institution may
require written confirmation to be provided to it within ten
business days of an oral notification of error if, when the
oral notification is made, the consumer is advised of such
requirement and the address to which such confirmation should
be sent. A financial institution which requires written
confirmation in accordance with the previous sentence need
not provisionally recredit a consumer's account in
accordance with subsection (c), nor shall the financial
institution be liable under subsection (e) if the written
confirmation is not received within the ten-day period
referred to in the previous sentence.
12 C.F.R. § 205.11(c)(1) sets forth the Board of
Governors of the Federal Reserve System's (“Board
of Governors”) interpretation of these provisions.
See, e.g., Gale v. Hyde Park Bank, 2007 WL
2358625, at *3 (N.D. Ill. Aug. 8, 2007). Courts grant the
Board of Governors' interpretation of its own regulations