IAT Effective Date Extended to September 18, 2009
Issued: July 31, 2008; Effective: September 18, 2009
EXECUTIVE SUMMARY
NACHA's Board of Directors has extended the effective date of the International ACH Transaction (IAT) rules and formats for six months, to September 18, 2009. NACHA and the two ACH Operators - the Electronic Payments Network and the Federal Reserve - strongly encourage financial institutions to have all production software implemented by March 20, 2009, the original effective date, and to use the six-month extension for additional process documentation, testing with the ACH Operators, and customer education, training and testing.
ALL U.S. DEPOSITORY FINANCIAL INSTITUTIONS MUST PREPARE
Receiving Depository Financial Institutions (RDFIs) may already be
receiving international ACH payments formatted as domestic
transactions (for example, as CCDs and PPDs), and so may currently
be unaware that they are receiving them. The IAT rules and formats
will enable RDFIs to identify international ACH payments, and
perform due diligence as required by the U.S. Office of Foreign
Assets Control (OFAC).
After the effective date, 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).
OFAC COMPLIANCE
While a financial institution can rely on vendors for ACH software,
transaction processing, and OFAC screening, it remains responsible
for compliance with OFAC regulations. A financial institution should
work proactively with its vendors on software, screening, testing,
and other readiness issues.
EDUCATION, TRAINING, AND TECHNICAL RESOURCES
All financial institutions are also encouraged to take advantage of education, training and technical assistance from Southern Financial Exchange, their ACH Operator, and NACHA. These programs will continue through the new effective date. Southern Financial Exchange will continue to offer IAT training in the classroom, via telephone seminars and webinars. Our classroom event on Current & Emerging Payments Issues will focus heavily on IAT. Visit http://www.sfe.org/ach_education.shtml
NACHA CONTACTS
Questions about this ACH Operations Bulletin should be directed to:
Priscilla C. Holland, AAP, CCM
Senior Director, International Programs
Ph: 703-561-3916
E-mail: pholland@nacha.org
Debbie Barr, AAP, CTP
Senior Director, ACH Network Rules
Ph: 703-561-3920
E-mail: dbarr@nacha.org
