1Providing guidelines for preauthorized electronic funds
2transfers for financial institutions.

3The General Assembly of the Commonwealth of Pennsylvania
4hereby enacts as follows:

5Section 1. Short title.

6This act shall be known and may be cited as the Preauthorized
7Electronic Funds Transfers Act.

8Section 2. Definitions.

9The following words and phrases when used in this act shall
10have the meanings given to them in this section unless the
11context clearly indicates otherwise:

12"Consumer." An individual holding an active banking account
13with a financial institution within this Commonwealth.

14"Department." The Department of Banking of the Commonwealth.

15"Financial institution." A bank, savings association, credit
16union or any other person operating within this Commonwealth
17that directly or indirectly holds an account belonging to a
18consumer or that issues an access device and agrees with a

1consumer to provide electronic funds transfer services.

2"Preauthorized electronic funds transfer." An electronic
3funds transfer authorized in advance to recur at substantially
4regular intervals.

5Section 3. Preauthorized electronic funds transfers.

6(a) Requirements.--

7(1) A preauthorized electronic funds transfer from a
8consumer's account must be authorized by the consumer in
9writing, and the financial institution shall provide a copy
10of the authorization to the consumer when made.

11(2) A financial institution shall provide a consumer
12with reasonable advance notice of the pending transfer so as
13to provide, if necessary, adequate time to stop payment of a
14preauthorized electronic funds transfer.

15(b) Stop payment.--

16(1) A consumer may stop payment of a preauthorized
17electronic funds transfer by notifying the financial
18institution orally or in writing at any time up to three
19business days preceding the scheduled date of such transfer.

20(2) The financial institution may require written
21confirmation to be provided to it within 14 days of an oral
22notification if, when the oral notification is made, the
23consumer is advised of such requirement and the address to
24which such confirmation should be sent.

25Section 4. Regulations.

26The department may promulgate regulations to administer this
27act. Until final regulations are adopted, the department shall
28regulate financial institutions under interim guidelines
29consistent with this act.

30Section 5. Effective date.

1This act shall take effect in 60 days.