Certified Regulatory Compliance Manager (CRCM) — Question 312

__________________ is a transfer that is authorized in advance to occur at substantially regular intervals. Payments that require the consumer to take specific actions to initiate them (such as by entering instructions on a touch-tone telephone or on the Internet) are not such type of EFTs.

Answer options

• A. A preauthorized EFT
• B. A postauthorized EFT
• C. A standard format EFT
• D. A customized EFT

Correct answer: A

Explanation

A preauthorized EFT is set up in advance to occur automatically, which fits the criteria specified in the question. In contrast, a postauthorized EFT requires authorization after the transaction occurs, while a standard format EFT and a customized EFT do not pertain to the frequency of authorization or payment initiation.