![]() ![]() In fact, consumers have significant protections provided by Regulation E and the Nacha Rules, and are much better insulated against questionable transactions through the ACH Network than when third parties use “remotely created checks” to debit consumers’ accounts. In short, much of the commentary that arose out of concerns regarding questionable origination practices fundamentally mischaracterized the nature of financial transaction processing through the ACH Network, and the responsibilities and obligations of participating Depository Financial Institutions. ![]() ![]() Once the consumer is re-credited, any further dispute between the consumer and the business about the purpose and validity of a debit is determined outside of the ACH system. This existing mechanism shifts the financial burden back to the ODFI of the ACH debit, appropriately placing the burden on the party that warranted the proper authorization of the debit in the first place. In this regard, the Nacha Rules provide a mechanism for a consumer to dispute the validity of an ACH debit, and then to be properly re-credited. Moreover, an RDFI is not in a position to respond to generalized complaints in the press or otherwise about the practices of a specific Originator(s).Īccordingly, an RDFI becomes aware of a questionable debit entry only when it is contacted by its customer. The ACH message itself, like any check or other payment instrument, provides no information about the substance of the underlying transaction to which the payment relates that would enable to RDFI to make such a judgment. In fact, when acting in the capacity of an RDFI, a financial institution has no relationship with the Originator of the ACH debit, and has no basis or information on which to make an independent judgment as to whether any specific ACH debit entry was properly authorized. In some instances, RDFIs were erroneously singled out as having a role in those practices simply by allowing consumers’ accounts to be debited in accordance with the Nacha Rules. Due to these Rules amendments, several aspects of two previous bulletins from 2013 have been superseded therefore, this bulletin replaces ACH Operations Bulletin #2-2013 (issued on March 14, 2013) and ACH Operations Bulletin #3-2013 (issued on July 15, 2013).ĭuring 2013, the ACH Network and its financial institution participants came under scrutiny as a result of the origination practices of certain businesses, such as online payday lenders, in using the ACH Network to debit consumers’ accounts. This ACH Operations Bulletin addresses the applicability of various sections of the Nacha Operating Rules (Nacha Rules) to questionable ACH debit origination activity, highlights the roles and responsibilities of both Originating Depository Financial Institutions (ODFIs) and Receiving Depository Financial Institutions (RDFIs), and describes several amendments to the Nacha Rules related to these topics. Replaces ACH Operations Bulletin #2-2013 (Originally Issued March 14, 2013) and ACH Operations Bulletin #3-2013 (Originally Issued July 15, 2013) ![]()
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