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Functional overview

Updated on March 15, 2022

The Pega Smart Dispute for Issuer application supports evaluation against Bill C86 for any fraud/unauthorized use that is reported on a Canada issued credit card.

Pega Smart Dispute for Issuers

A fraud/unauthorized use that is reported on a Canadian issued credit card is eligible for evaluation against Bill C86. Disputed transactions that are subject to the requirements of Bill C86 are flagged on the Overview tab, as shown in the following image:

Eligibility of C86 evaluation
The Overview tab of the dispute transaction screen that denotes eligibility of C86 evaluation.

For cases that are eligible for Bill C86, two new questions are displayed on the fraud submission screens for both Visa and MasterCard to help you make the correct decision.

Fraud submission questionnaire
The questions displayed on the fraud submission screen for Visa dispute transactions.

Note: The Was the issuer notified of Loss/Stolen/Unauthorized use of card before the transaction date option is applicable only for the lost or stolen card fraud types.

Fraud submission questionnaire
The questions displayed on the fraud submission screen for MasterCard dispute transactions.

According to the regulations of Bill C86, a cardholder cannot be liable for more than CAD50 for fraud or unauthorized use that is reported on a credit card until the issuer establishes that the fraud is due to gross negligence of a cardholder.

The C86 Bill does not define the precise criteria that constitute gross negligence. However, the Bill does specify a few examples of behaviors that cannot be deemed gross negligence.

In the absence of prescriptive regulatory guidance, operators must decide whether the transaction conditions constitute “gross negligence” based on the issuer’s internal policies and respond accordingly to the question Does this fraud transaction qualify to be a result of Gross Negligence by cardholder?

If the determination is that the transaction does NOT qualify as gross negligence, the cardholder cannot be liable for more than CAD50. The system displays an error if the cardholder is held liable for more than CAD50 at any stage during the dispute process, as shown in the following figure. If the cardholder is determined to be partially liable across different stages in the dispute life cycle, the total cardholder liability cannot exceed CAD50.

Note: The maximum liability limit of CAD50 is for each transaction or dispute.

Process liability section to set cardholder liable limit
The dispute transaction screen that enables the customer to set the cardholder liable limit of CAD50.

According to the regulations of Bill C86, a cardholder cannot be liable if the cardholder has already notified the issuer of fraudulent activity or possible fraudulent activity on the card before the transaction.

If the question Was the issuer notified of Loss/Stolen/Unauthorized use of card before the transaction date? has a response of Yes, the cardholder cannot be held liable at any stage in the dispute. If this occurs, the system presents an error, as shown in the following image.

In the scenario where the fraud is an outcome of gross negligence by the cardholder and the issuer does not receive notification of any possible fraudulent activity, the cardholder can be held liable for any amount up to a maximum of dispute amount.

Error message specifying the cases qualified for C86 protection
Specifies the cardholder liability for the list of cases already submitted for C86 evaluation.

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