Commercial Customers Rights & ACH Disputes
Answer by John Burnett, BOL Guru Guru Bio
Question: Does a commercial customer have the same rights as a non-commercial consumer regarding ACH disputes for an item he/she wishes to be returned?
Answer: Not exactly. The commercial customer is not covered by the EFT Act or Regulation E, so any rights to reimbursement for unauthorized ACH items would either derive from NACHA rules, your deposit agreement, or state law. NACHA provides the same protections for all customers with regard to certain ACH entries: ARC, BOC, POP for example, and businesses can have the added benefit that their checks don't qualify for conversion, if they have a serial number encoded in the auxiliary on-us field (to the left of the routing number in the elongated MICR line on business-size checks).
The general NACHA rule is that corporate ACH entries have to be returned within the ACH equivalent of the midnight deadline. They have to be available to the ODFI by the start of business on the second banking day following the Settlement Date of the original entry.
That doesn't mean that your customer is left without recourse if an unauthorized PPD, for example, debited its account at the start of the month, and it's not detected until the customer gets its statement. If the entry wasn't authorized, the customer is entitled to reimbursement if the customer provides timely notice of the unauthorized entry.
That leaves the Originator and ODFI's warranties that the transaction was authorized. Those warranties are given both to you as the RDFI and to the Receiver. They can be pursued outside the framework of the ACH transaction process.
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