NCCO Exam #2 Test Questions and Answers Graded A+
Savings accounts
Checking accounts
Reg E: Account Types Covered?
Payroll cards established for personal, family or house-
hold purposes
Business purpose accounts
Reg E: Account Types NOT Covered? Accounts held under a trust agreement
Escrow accounts
any movement of funds by means of an electronic termi-
nal, telephone, computer or magnetic tape for the pur-
What is an EFT?
pose of ordering or authorizing a FI to debit/credit a
consumer's account
Automated teller machines, direct deposit, debit cards,
EFT Examples and electronic checks, online bill payments, telephone
transfers
Must be provided at the time the EFT service is established
When are EFT disclosures required?
OR before the first EFT is made
Must be provided monthly for every month where there is
If required, when must a periodic statement be sent?
an EFT. Otherwise, quarterly.
ANY EFT from an account initiated by a person other than
What is an unauthorized EFT under Reg E? the consumer WITH NO authority and from which con-
sumer gets NO benefit.
Forced to conduct a transfer
Phishing
Examples of an unauthorized EFT:
Card skimming
Stolen access device
1) When member acts alone/with another with fraudulent
intent (ex. member gives brother ATM/PIN. Brother makes
purchases and member makes claim)
, NCCO Exam #2 Test Questions and Answers Graded A+
2) Authorized user transacts on account BUT exceeds au-
Two examples where transactions are not considered
thority (ex. I give you card to purchase lunch and you take
unauthorized:
card and purchase week's worth of groceries)
$50, $500 or unlimited:
Level 1-->$50- applies if the member notifies the CU of the
loss or theft of an access device within 2 business days of
learning of the loss. Can only be held responsible for $50
Level 2-->$500-applies if the member does not notify CU
within 2 business days, but notifies within 60 days after
What are the 3 ditterent levels of liability for unauthorized
periodic statement is sent. (Calculation is $50 (or amount
transfers (access devices)?
of unauthorized EFTs that occurred within 2 BD if less than
$50) plus any transactions occurring between 2 days and
notice date up to $500)
Level 3-->Unlimited: applies if the member notifies CU
more then 60 days after statement is sent. (Calculation is
anything occurring after 60 day period) plus any amounts
owed under the first 2 levels.
1) Within 60 days after periodic statement is sent, no
liability
What are the 2 levels of liability when NO access device is
used? 2) Greater than 60 days after periodic statement, full liabil-
ity for any transactions occurring after 60 days and before
notice to the CU
No provisional credit: 10 business days (20 for new ac-
counts)
Timelines for CU to complete its investigation:
PC: 45 days (90 days for new accounts, foreign transfers,
POS debit card transactions)
, NCCO Exam #2 Test Questions and Answers Graded A+
Can credit unions require members to pay a loan via an NO. Cannot require, but can incentivize in the form of
EFT as part of the approval process? lower rates or fees
Electronic transfer of funds requested by a sender (for
personal, family or household purposes) to a recipient
What is a remittance transfer?
(must be located in a foreign country) by a remittance
transfer provider
person providing remittance transfers in the "normal
What is a remittance transfer provider?
course of business".
When is a remittance transfer provider NOT providing RTs If the RT provides 500 or fewer transfers in the prior
in the normal course of business? calendar year and 500 or less in the current calendar year
Function Test:
-issued on a prepaid basis or capable of being loaded with
funds after to conduct transfers at multiple merchants/P2P
transfers;
-primary function of the account is to conduct transfers
with multiple, unaflliated merchants, at ATMs or for (P2P)
transfers; and
-Is not a checking account, share draft account or nego-
Prepaid Accounts: What is the function test? Examples? tiable order of withdrawal account.
Examples:
-Payroll card accounts (EFTs of salary/comp provided on a
recurring basis
-Government benefit accounts
-accounts marketed or labeled as prepaid, can be re-
deemed at multiple ATM/merchants
-accounts meeting the function test
Generally, error resolution/liability rules apply.
Error resolution: Prepaid Accounts
Savings accounts
Checking accounts
Reg E: Account Types Covered?
Payroll cards established for personal, family or house-
hold purposes
Business purpose accounts
Reg E: Account Types NOT Covered? Accounts held under a trust agreement
Escrow accounts
any movement of funds by means of an electronic termi-
nal, telephone, computer or magnetic tape for the pur-
What is an EFT?
pose of ordering or authorizing a FI to debit/credit a
consumer's account
Automated teller machines, direct deposit, debit cards,
EFT Examples and electronic checks, online bill payments, telephone
transfers
Must be provided at the time the EFT service is established
When are EFT disclosures required?
OR before the first EFT is made
Must be provided monthly for every month where there is
If required, when must a periodic statement be sent?
an EFT. Otherwise, quarterly.
ANY EFT from an account initiated by a person other than
What is an unauthorized EFT under Reg E? the consumer WITH NO authority and from which con-
sumer gets NO benefit.
Forced to conduct a transfer
Phishing
Examples of an unauthorized EFT:
Card skimming
Stolen access device
1) When member acts alone/with another with fraudulent
intent (ex. member gives brother ATM/PIN. Brother makes
purchases and member makes claim)
, NCCO Exam #2 Test Questions and Answers Graded A+
2) Authorized user transacts on account BUT exceeds au-
Two examples where transactions are not considered
thority (ex. I give you card to purchase lunch and you take
unauthorized:
card and purchase week's worth of groceries)
$50, $500 or unlimited:
Level 1-->$50- applies if the member notifies the CU of the
loss or theft of an access device within 2 business days of
learning of the loss. Can only be held responsible for $50
Level 2-->$500-applies if the member does not notify CU
within 2 business days, but notifies within 60 days after
What are the 3 ditterent levels of liability for unauthorized
periodic statement is sent. (Calculation is $50 (or amount
transfers (access devices)?
of unauthorized EFTs that occurred within 2 BD if less than
$50) plus any transactions occurring between 2 days and
notice date up to $500)
Level 3-->Unlimited: applies if the member notifies CU
more then 60 days after statement is sent. (Calculation is
anything occurring after 60 day period) plus any amounts
owed under the first 2 levels.
1) Within 60 days after periodic statement is sent, no
liability
What are the 2 levels of liability when NO access device is
used? 2) Greater than 60 days after periodic statement, full liabil-
ity for any transactions occurring after 60 days and before
notice to the CU
No provisional credit: 10 business days (20 for new ac-
counts)
Timelines for CU to complete its investigation:
PC: 45 days (90 days for new accounts, foreign transfers,
POS debit card transactions)
, NCCO Exam #2 Test Questions and Answers Graded A+
Can credit unions require members to pay a loan via an NO. Cannot require, but can incentivize in the form of
EFT as part of the approval process? lower rates or fees
Electronic transfer of funds requested by a sender (for
personal, family or household purposes) to a recipient
What is a remittance transfer?
(must be located in a foreign country) by a remittance
transfer provider
person providing remittance transfers in the "normal
What is a remittance transfer provider?
course of business".
When is a remittance transfer provider NOT providing RTs If the RT provides 500 or fewer transfers in the prior
in the normal course of business? calendar year and 500 or less in the current calendar year
Function Test:
-issued on a prepaid basis or capable of being loaded with
funds after to conduct transfers at multiple merchants/P2P
transfers;
-primary function of the account is to conduct transfers
with multiple, unaflliated merchants, at ATMs or for (P2P)
transfers; and
-Is not a checking account, share draft account or nego-
Prepaid Accounts: What is the function test? Examples? tiable order of withdrawal account.
Examples:
-Payroll card accounts (EFTs of salary/comp provided on a
recurring basis
-Government benefit accounts
-accounts marketed or labeled as prepaid, can be re-
deemed at multiple ATM/merchants
-accounts meeting the function test
Generally, error resolution/liability rules apply.
Error resolution: Prepaid Accounts
