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#1151728 - 03/26/09 01:36 PM NSF Check handling (also ACH Dr NSF handling)
Jordan Offline
New Poster
Joined: Mar 2009
Posts: 2
Hello,
In conjunction with preparing an internal audit response, Im looking for input/opinions regarding the handling of NSF postings to DDA where the offending entry is a clearing check or an ACH Dr received.
Assuming the debit transaction is otherwise considered authorized;
1 - Is anyone actually preventing the debit from posting to a DDA in order to avoid an overdraft condition?
2 - In addition, is anyone returning these items same-day?
If yes to 1 and no to 2, where are the debits being held?
Thanks

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#1152677 - 03/27/09 02:11 PM Re: NSF Check handling (also ACH Dr NSF handling) Jordan
LynnH Offline
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LynnH
Joined: Dec 2002
Posts: 129
NH
The decision to pay or return is done on an account by account basis. We have a decision tree that when followed will tell them if the item would be paid or returned. It takes into account the overall relationship with the customer, # returns over the last year (that tells us they didn't make good), new acct, amount of entry, etc.
Any changes to the outcome the decision tree comes to would have to be approved by an officer.
Last edited by LynnH; 03/27/09 02:12 PM.
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#1152711 - 03/27/09 02:25 PM Re: NSF Check handling (also ACH Dr NSF handling) LynnH
HappyGilmore Offline
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Pulling people out of the ditc...
I don't understand how you can not post the item so it doesn't OD the account, but still return the item. I would think that in order to meet the requirements of Reg CC and UCC, the item would need to post first. I'd hate to be the one trying to explain a "holding" account for items that you don't post but do/don't return and/or "hold" until funds are available.
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#1152900 - 03/27/09 04:02 PM Re: NSF Check handling (also ACH Dr NSF handling) HappyGilmore
BrendaC Offline
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BrendaC
Joined: Sep 2001
Posts: 6,029
Sweet Home AL
Some banks operate on a "post none" philosophy while others are "post all". While I prefer "post all", they both will work.
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#1152922 - 03/27/09 04:20 PM Re: NSF Check handling (also ACH Dr NSF handling) LynnH
Jordan Offline
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Joined: Mar 2009
Posts: 2
LynnH,
If your decision tree determines that a return is in order, do you not post the item prior to processing the return?
Thanks for your response.
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#1153637 - 03/30/09 02:30 PM Re: NSF Check handling (also ACH Dr NSF handling) Jordan
Georgia Plum
Unregistered

We are a post none environment which means that all NSF checks will not post until a decision is made. If the decision is made to pay the item, it will post to the customer's account the following night. If the decision is made to return the item, it will never post to the customer's account.

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#1153675 - 03/30/09 02:58 PM Re: NSF Check handling (also ACH Dr NSF handling)
LynnH Offline
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LynnH
Joined: Dec 2002
Posts: 129
NH
We are a post all bank, so the item does post to the account overdrawing it. When we decide to return we credit it back to the account and return it.

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#1154380 - 03/31/09 01:10 PM Re: NSF Check handling (also ACH Dr NSF handling)
HappyGilmore Offline
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Joined: Jun 2004
Posts: 19,580
Pulling people out of the ditc...
Originally Posted By: Georgia Plum
We are a post none environment which means that all NSF checks will not post until a decision is made. If the decision is made to pay the item, it will post to the customer's account the following night. If the decision is made to return the item, it will never post to the customer's account.


are you in compliance if challenged? How can a transaction be NSF if it has not posted? What rationale do you use to return, and what is the return reason?
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#1154473 - 03/31/09 02:28 PM Re: NSF Check handling (also ACH Dr NSF handling) HappyGilmore
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 39,793
Cape Cod
Post none is a common procedure. It has been in use for decades (even back to my first banking experience!). All the bank has to show is that there is not a sufficient balance to pay the presented item. It makes sense for a bank that routinely bounces most NSF items. But if a bank pays more items than it bounces, it makes more sense to post and reverse.
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#1154934 - 03/31/09 08:28 PM Re: NSF Check handling (also ACH Dr NSF handling) John Burnett
Georgia Plum
Unregistered

As John says, many banks use post none. I've worked for both and would rather be a post all environment as it is more clear to the customer and your research staff because you see everything in/out of the account. But either is compliant and legal.

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