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Press Release |
Contact: Gail Hillebrand, (415) 431-6747 |
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SAN FRANCISCO, CA Consumers Union today announced its support for AB 1638, a bill to protect consumers who experience loss or theft of their debit cards. The bill, sponsored by Assemblywoman Valerie Brown (Sonoma) and Speaker Antonio Villaraigosa (Los Angeles), adds debit cards to an existing section of state law that caps a consumer’s responsibility at $50 for unauthorized use of the card. This would make consumer liability for debit cards equal to the current liability for credit cards. AB 1638 also reduces the risk of a debit card for consumers by requiring that funds removed using a lost or stolen card be promptly returned to the customer’s account by the bank.
Debit card use is on the rise, with more than 60 million debit cards in use worldwide.
“One of the drawbacks to debit cards is that you typically must wait for the card issuer to put money back into your account after unauthorized use of your lost or stolen card,” said Gail Hillebrand, senior attorney with Consumers Union. “AB 1638 insures that your money will be returned to your account within 48 hours, and that the dispute will be finally resolved within 10 business days. AB 1638 also limits your liability as a debit cardholder to $50 when your card is misused by someone else. AB 1638 makes debit cards a safer and more attractive way to pay.”
Banks are able to meet the 48-hour requirement for returning stolen funds to an account. In a survey conducted by Visa and reported last year, half of Visa’s 12 largest debit card issuers nationwide said they recredit a customer’s account within only two days.
“Banks can meet this deadline, and should be required to do so to protect consumers,” Hillebrand said.
A hearing on the bill is scheduled for Monday, March 30 at 4 P.M. before the Assembly Banking and Finance Committee.
