The Deadline Is Getting Closer ... and Closer by ProQuest

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With the implementation of the new IAT SEC code on Sep 18, 2009, the fundamental definition of what constitutes an international ACH payment will change. If you think your community bank will not receive an IAT payment because it has never received a PBR or CBR transaction, or because it does not originate international ACH transactions, please think again. The new definition of International ACH Transaction was added to the NACHA Operating Rules to identify international transactions that are flowing through the ACH Network today but can't be identified as international in origin or receipt because there is insufficient information contained in the record. The implementation of the IAT SEC code will require compliance with the NACHA Operating Rules and compliance with the Office of Foreign Assets Control.

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                The Deadline
                                                                                                               deposit from those customers’
                                                                                                               employers? After Sept. 18, those
                                                                                                               direct deposits could be format-
                                                                                                               ted as an IAT transaction.


                Is Getting Closer ... and Closer                                                                  Even if your community
                                                                                                               bank does not originate IAT
                                                                                                               transactions, it must prepare for
                International ACH rules will affect community             tion from PayPal or a similar        the implementation of the IAT.
                                                                          provider to fund the purchase of     Perhaps your bank’s vendor has
                banks this fall. Will you be ready?                       china from a retailer in England     told you not to worry—it is
                                                                          would be an IAT transaction.         taking care of the technical
                              By Pr IscIlla c. H olland                                                        details for you! That is great, but
                                                                            Do you have a customer who         has your bank checked its down-

                                  W       ith the implementation of
                                          the new IAT SEC code on
                                   Sept. 18, 2009, the fundamental
                                                                          currently uses a decoupled debit
                                                                          card from another institu-
                                                                          tion? If that customer uses the
                                                                                                               stream applications? Is the vendor
                                                                                                               handling those details, too?
                                                                                                                  What about your bank’s OFAC
                                   definition of what constitutes         decoupled debit card to purchase     compliance procedures? If the
                                   an international ACH payment           a souvenir on their trip to Rome,    vendor is doing the OFAC review
                                   will change. If you think your         the point-of-sale debit that your    of the transactions to identify
                                   community bank will not receive        bank receives today will be an       suspect transactions, does your
                                   an IAT payment because it has          IAT after Sept. 18.                  bank have procedures in place to
                                   never received a PBR or CBR                                                 complete the investigation, con-
                                   transaction, or because it does           Do you have customers             tact OFAC and freeze the funds?
                                   not originate international ACH        who work for mul
								
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