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Separate or commingled?
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Test Files
Test files directly from FRB
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Latest Revisions
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Are you ready?
What is an IAT?
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It might be an IAT if...
Who will be affected?
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Key Issues
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How can VolCorp help?
VolCorp IAT Committee
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Industry Information
Should I receive IAT items as a separate ACH file or commingled with domestic transactions?
In order to assist your credit union with the new IAT rule change, effective September 18, 2009, current APEX-ACH receipt users have the option of receiving IAT items separately in a distinct IAT NACHA formatted file (2 files), or commingled with other SEC codes, including IAT return items (1 file). All APEX-ACH receipt users are asked to designate their preference on the new set-up form below which must be signed by an authorized signer for the credit union.
• APEX Credit Union Set Up Form
It is important to understand how your data processor will handle IAT items before making your decision. For example, your data processor may automatically post IAT items that are blank or carry a “0” in the screening indicator field with your domestic items. This process could potentially delay the posting of your domestic items if you perform the necessary OFAC review on each and every IAT transaction prior to posting, as required for OFAC compliance. A separate, distinct IAT NACHA formatted file could be very beneficial in this situation.
Please note that if your credit union chooses to receive IAT items as a separate file, a one-time $10 system access profile change fee will be charged by U.S. Central upon receipt of the set-up form.
Also, prior to submitting the set-up form, you will need to check with your data processor to make sure that they are prepared to receive two separate ACH files per day.
Even if you choose to continue receiving one commingled file, please sign and return the set-up form indicating your preference to VolCorp. All set-up forms should be returned to the attention of Karen Clabough (Fax: 615-232-7979 or
coordinator@volcorp.org) by no later than July 31, 2009.
IAT test files are now available for use in APEX-ACH Test Region
All APEX-ACH receipt users are strongly encouraged to begin IAT testing in the APEX-ACH training region prior to August 31, 2009. Several generic ACH receipt files including the new IAT code are now available for APEX-ACH testing. Test files are available in several formats and should be used in accordance with your setup (94-Character or Flat File). To obtain login credentials to the APEX-ACH training region, please contact the IAT Committee at
iat@volcorp.org.
• IAT Testing Information
How do I test if I receive my ACH files directly from the FRB?
If you receive your ACH files directly from the FRB (and not through APEX-ACH),
then you can request test files by clicking on the following link:
Click Here
All requests must be received by 12 Noon EST 48 hours prior to request date. No testing on Sundays or Mondays.
Latest revisions to OFAC requirements
Under OFAC’s revised requirements, a Gateway Operator that identifies the presence of a blocked party in an inbound IAT debit should cease processing the entry, and should take several additional steps to report the hit to OFAC, the Foreign Gateway Operator, and the RDFI.
OFAC further expects that Gateway Operators’ notifications to RDFIs about OFAC hits will eventually take place through the ACH Network. NACHA will issue additional guidance when methods and procedures for these notifications are established.
Click here for a complete copy of NACHA’s Inbound IAT Debit Processing Recommendations and Guidance for Gateway Operators and RDFIs.
Are YOU ready for the largest ACH rule change in twenty years?
“After September 18, 2009, any financial institution that participates in the ACH Network may receive an IAT, and must handle it in accordance with written OFAC policies. All RDFIs must therefore be prepared for this rule, even those that do not currently receive ACH payments formatted as cross-border payments (the existing CBR and PBR formats).”
NACHA ACH Operations Bulletin issued July 31, 2008
What is an International ACH Transaction (IAT)?
International credit and debit payment instructions that are exchanged across national borders to transfer value between an Originator (sender) and a Receiver (beneficiary). NACHA Rules will require every ACH payment entering or exiting the United States to be identified and formatted as an International ACH Transaction (IAT). Furthermore, the existing SEC codes for cross border payments (CBR and PBR) will be deleted and replaced by the new SEC code IAT for International ACH Transactions.
It might be an IAT if…
- You receive ACH files from local financial institutions that are owned by foreign FIs, it might be an IAT.
- You have corporate customers that have employees or retirees living overseas, it might be an IAT.
- You have customers that buy or sell internationally through PayPal and similar applications, it might be an IAT.
- You have consumer or business customers that travel overseas and make purchases using wither a debit card or check, it might be an IAT.
- You have customers with decoupled debit cards linked to an account at your FI and they travel overseas and use the card, it might be an IAT
All ODFIs and RDFIs that originate and/or receive ACH transactions will be affected by the IAT rule change.
- All financial institutions that receive ACH transactions (RDFIs) will need to establish a written OFAC compliance policy for the handling of IAT transactions and meeting OFAC compliance obligations.
- Financial institutions that originate ACH transactions (ODFIs) will need to educate their staff on the implications of the IAT changes, educate their Originators on the obligations for Originators with the IAT rule changes, determine if they have Originators that are currently originating ACH transactions that meet the definition of the IAT, and establish a written OFAC compliance policy.
Key Issues for RDFI’s:
- Develop and implement written OFAC compliance policy or revise existing policy
- Identify IAT entries and screen for OFAC compliance
- Provide IAT information on periodic statements
- Educate staff
- OFAC compliance obligations
- Handling of IAT entries, including Returns and
NOC’s
- Review fee schedules
All areas of your credit union must be ready on September 18, 2009, including operations, compliance, member services, marketing/sales, and your data processing system as penalties for non-compliance with OFAC’s regulations can be severe. Credit unions can contract with other parties for OFAC review, but
CANNOT contract away their liabilities related to OFAC compliance.
How can VolCorp help?
VolCorp has created an IAT Committee for the purpose of educating our members about how the new IAT requirements will affect them. The goals of this committee include:
Here are your VolCorp IAT Committee members:
- Cassie Hendry – Chair, Ext. 282
- Karen Clabough – Co-Chair, Ext. 270
- Jenifer Wade, Ext. 247
- Justin Holt, Ext. 283
- Kim Schott, Ext. 233
- Lea Joy, Ext. 251
- Michelle Palmer, Ext. 277
- Sherry Alers, Ext. 290
- Susan Wilkerson, Ext. 229
- Veronica Hambrick, Ext. 287
Phone: (800) 470-3444 or (615) 232-7900
Email: iat@volcorp.org
Please check this page for additional information regarding IAT transactions in the coming months from our newly formed IAT Committee.
Industry Information
NACHA
Industry
Resources
2009 ACH Rule Book
IAT Survival Guide (can be purchased from NACHA or TACHA)
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