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#1922645 - 05/13/14 03:24 PM Block all ACH debits on an account
Matt_B Offline
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Matt_B
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A CU, Where Regs Don't Apply
Our ACH processing person has asked me to assist in answering a question that has been asked multiple times. If a customer (for whatever reason) never wants to allow an ACH debit to be paid, is this something we want to allow? We have the ability to block this in our core system, but haven't messed with it before. For some reason, she has it in her head that this can only be done via court order, but neither her or I have any clue if that's based on anything factual.

In my opinion, we're putting ourselves in between our account holder and whoever they may be authorizing to take money from the account, and creating situations where we're aiding people in not paying their bills, so I don't see why we would want to.

Does anyone allow/use this type of setting on a consumer deposit account? How do you justify it's use, do you charge fees, do you have a specific agreement/indemnification signed? It seems it would contradict our account agreement otherwise to just do something like this based on a verbal request.
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#1922668 - 05/13/14 03:47 PM Re: Block all ACH debits on an account Matt_B
John Burnett Offline
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Such a block is permitted on non-transaction accounts (passbook or statement savings, CDs, etc.). As far as I can see, your participation in the ACH as an RDFI prevents you from doing an "all debits" ACH block otherwise.
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#1922682 - 05/13/14 04:03 PM Re: Block all ACH debits on an account Matt_B
Matt_B Offline
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Seems in line with what we do. For our operations, it's essentially not an option then. All I needed to know!

Honestly, I think the bulk, if not all people that want to do something like this are people dealing with payday loans, or involved in what turned out to be a not so upstanding debt solutions company. I'm not inclined to do too much for them aside from suggesting they close the account and move along!

Thanks John.
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#1923034 - 05/14/14 03:24 PM Re: Block all ACH debits on an account Matt_B
A_G Offline
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Matt, take a look at NACHA Operating Rule 3.1.1 for a cite.

And I don't even think you can technically block them for non-transaction accounts - they just become automatically subject to your right to return the ACH entry for that reason.
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#1923315 - 05/14/14 08:31 PM Re: Block all ACH debits on an account A_G
John Burnett Offline
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Originally Posted By: RЯ AA_G
Matt, take a look at NACHA Operating Rule 3.1.1 for a cite.

And I don't even think you can technically block them for non-transaction accounts - they just become automatically subject to your right to return the ACH entry for that reason.
That's correct.
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#1925071 - 05/21/14 12:59 PM Re: Block all ACH debits on an account Matt_B
HappyGilmore Offline
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3.1.1 says an RDFI must accept entries, it does not say you must post them to your customers accounts. You may certainly do a debit block on customers accounts at their request (and there are legitimate reasons to do so, such as fraud), there are many commercial products that do this (PEP+ is one that quickly comes to mind). Many moons ago I had this very conversation with NACHAs senior director of network rules, who told me "don't read more into it that isn't there. A customer has the right to refuse any and all transactions."
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