Topic: Automated Clearing House (ACH) Transactions
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Our internal auditors examined our bank’s ACH agreements with employees (for direct deposit of their paychecks) and asked us to add language that would explain what steps are required to revoke the ACH authorization. Do the NACHA rules require us to add that language to our ACH agreements?
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We agree with your internal auditors that your direct deposit ACH authorization forms should include information on revoking an authorization. That said, it is up to you to determine the method by which your employees should revoke (or change) their authorizations. The NACHA rules require that every ACH authorization include language stating that “the Receiver…
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Under Illinois law, are we required keep open all deposit accounts with social security direct deposits, even if a customer no longer qualifies for a deposit account with us (due to a loan charge-off)?
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We believe that you would be able to close a checking account that receives direct deposits of Social Security payments, provided that you follow all of the notice requirements in your account agreements and under the ACH direct deposit rules. The “Green Book” (the Treasury’s Guide to Federal Government ACH Payments and Collections) requires thirty…
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Do we need to have customers re-sign their ACH authorizations after we purchase their accounts through an FDIC sale?
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We recommend that borrowers sign new Authorization Agreements for Direct Deposit so that loan payments are correctly routed to your bank.