## Facts

- Morvarid Paydar Kashanchi and her sister, Firoyeh Paydar, jointly owned a savings account at Texas Commerce Medical Bank in Houston, Texas.
- Around February 9, 1981, $4,900 was transferred out of the account.
- The transfer was allegedly initiated by a telephone conversation between a bank employee and a person other than either account owner.
- The transaction was not made under any prearranged plan or agreement contemplating periodic or recurring transfers.
- After receiving a March 31, 1981 account statement showing the withdrawal, Paydar sent the bank a letter dated April 15, 1981 asserting the withdrawal was unauthorized and requesting correction.
- The bank refused to recredit the account.
- On December 4, 1981, Kashanchi sued in federal court alleging violations of the Electronic Fund Transfer Act (EFTA), 15 U.S.C. § 1693 et seq.
- The district court dismissed for lack of subject-matter jurisdiction, concluding the transfer fell within the statutory exclusion in 15 U.S.C. § 1693a(6)(E).

## Issues

1. Whether a single, non-periodic transfer initiated by a telephone conversation between a bank employee and a non-account-holder falls within the EFTA’s definition of “electronic fund transfer,” or is excluded by 15 U.S.C. § 1693a(6)(E).
2. If the EFTA does not cover the transaction, whether dismissal for lack of subject-matter jurisdiction is proper.

## Decision

- The Fifth Circuit affirmed the dismissal.
- The court held the challenged transaction was excluded from the EFTA’s definition of “electronic fund transfer” by 15 U.S.C. § 1693a(6)(E) because it was telephone-initiated and not made pursuant to a prearranged plan for periodic transfers.
- Because the EFTA did not apply, Kashanchi had no federal cause of action under the statute; the district court properly dismissed for lack of subject-matter jurisdiction.

## Legal Principles

- Statutory interpretation begins with the text; absent clearly expressed contrary congressional intent, the statutory language controls.
- Under 15 U.S.C. § 1693a(6)(E), certain telephone-initiated transfers that are not made pursuant to a prearranged plan or agreement contemplating periodic transfers are excluded from the EFTA’s coverage.
- When the alleged conduct falls outside the EFTA’s defined scope, the statute supplies no federal claim, and dismissal is warranted.

## Conclusion

The Fifth Circuit held that an allegedly unauthorized, one-time withdrawal initiated by telephone instructions from a non-account-holder is excluded from the EFTA when it is not part of a prearranged periodic transfer plan; without EFTA coverage, the federal action was properly dismissed for lack of subject-matter jurisdiction.


Kashanchi v. Tex. Commerce Med. Bank, N.A., 703 F.2d 936 (5th Cir. 1983)