As previously announced in FedFlash, the Federal Reserve Banks recently amended Operating Circular 4, Automated Clearing House Items, on two occasions.
The first amendment became effective February 15, 2008. Changes made in that amendment include the following:
- New paragraph 1.5 states that Reserve Banks are ACH operators and not collecting or returning banks with respect to ACH items.
- Paragraphs 5.1(c) and 12.1(c) now state that by sending ACH items to or receiving items from a Reserve Bank a bank agrees that the Reserve Bank processes the items as an ACH operator and not as a collecting or returning bank.
- Paragraphs 3.6(a) and 7.4(a) now state that if a sending or receiving bank designates an agent to send or receive on its behalf the bank is responsible for ensuring that its agent complies with the bank’s obligations under the operating circular.
- In Appendix A (ACH Security Procedures), new paragraph 2.5 states that if a bank uses a third-party entity as its sending or receiving point, the bank remains responsible for its obligations under the appendix, including those set forth in security documentation provided by the Reserve Banks, and for ensuring that its agent complies with the same.
- In Appendix B (ACH Items Time Schedule), the heading to paragraph 1.3 has been revised to clarify that the deadlines listed are for file transmission. New paragraph 1.4 states that Reserve Banks only utilize best efforts in providing extra courtesy deliveries when requested to do so by a receiving bank.
- In Appendix E (FedACH Risk® Origination Monitoring Service), section 9 provides a new measure for liability, which is now limited to the FedLine Web® W3 monthly access fee and any risk origination criteria fees paid in the month preceding the transaction or occurrence that gives rise to liability.
The second amendment, which became effective March 1, 2008, sets forth the terms and conditions for two new FedACH® services: File Alert and FedEDI® Plus. The terms and conditions for the File Alert service are contained in new Appendix E1. The terms and conditions for the FedEDI Plus service are contained in new Appendix F1.
Your continued use of Reserve Bank services on or after the effective dates of these amendments constitutes agreement to the new terms of the operating circular.
See the link below on the Federal Reserve Financial Services website for the official version of the amended operating circular. To request a paper copy of any operating circular, contact your Customer Contact Center.
“FedACH,” “FedACH Risk,” “FedEDI,” and “FedLine Web” are registered service marks of the Federal Reserve Banks.