Preauthorized Electronic Fund Transfer Law and Legal Definition

The term "preauthorized electronic fund transfer" means an electronic fund transfer authorized in advance to recur at substantially regular intervals. A preauthorized electronic fund transfer from a consumer's account may be authorized by the consumer only in writing, and a copy of such authorization shall be provided to the consumer when made. A consumer may stop payment of a preauthorized electronic fund transfer by notifying the financial institution orally or in writing at any time up to three business days preceding the scheduled date of such transfer.