What to do with ACH transactions in such cases can be a difficult decision, particularly if there are transactions like utility payments, etc., continuing. However, the authorization for any such continuing transactions ceased to be effective upon the depositor's death.
It would have been correct to return the ACH entries received after you had knowledge of the depositor's demise using an R15 return code (Death of depositor). Use of Account Frozen would be inappropriate.
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8