When someone gains unauthorized access to your bank account, the act is a form of identity theft. The Electronic Fund Transfer Act (EFTA) provides you with some protection from bank account fraud, but it's limited. If you believe that an identity thief has access to your debit card or checking information, you must take action immediately.﻿﻿

Your bank may call actions relating to account identity theft unauthorized withdrawals, account fraud, or even true-name fraud. Whatever language is used, you need to know what to do and how you're protected.

The Basics of the Electronic Fund Transfer Act

The EFTA provides banks with some guidelines on how to resolve disputes possibly related to identity theft. However, the onus is on you, the account holder, to recognize unauthorized transactions on your account.

If you notice an error, report it immediately. If you wait, you could be out of luck. According to the EFTA, you have 60 days to report an unauthorized transaction to your financial institution. If you report after that, than the bank isn't required to conduct an investigation. ﻿﻿

To catch bank account identity fraud sooner rather than later, make a habit of reconciling your bank account each month when you receive your bank statement. If you have numerous deposit and debit transactions, reconciling your account twice a month could be a wise habit.

Information Your Bank Needs to Investigate the Crime

To begin investigating your claim, you must provide certain information to your bank. The following details are helpful in determining the steps the bank needs to take to resolve your dispute, based on EFTA rules:

Your name and account number

Why you think there is an error

The amount of the error

The date for the error

Many banks request that you provide this information in writing no later than 10 days after you initiate a dispute.﻿﻿

If the account has been active for more than 30 days, the bank will do an investigation and get back to you within 10 days. If a bank needs more time, it can take up to 45 days but will credit the funds back to your account while it investigates. The bank should inform you if the investigation will take longer than normal.

If the account is less than 30 days old or you’re disputing point-of-sale or foreign transactions, it may take up to 20 days to apply the temporary credit to your account. It also may take up to 90 days to finish the investigation.﻿﻿

Authorized Users vs. Unauthorized Charges

If the bank's investigation doesn’t support your claims, it will notify you in writing and take the credits back from your account. One reason it may not support your claim is excessive use by an authorized user.﻿﻿

For example, if you let your son use your card, and he spends more than you told him he could, the bank won't consider that an identity theft because you gave him permission to use the card.