We have an individual consumer account that has recently started receiving large ACH Debits that are actually in the name of a business. For example, the name on the account is John Smith, but the "Individual Name" on the ACH Debit is XYZ Sprokets. Are we supposed to be returning the debits or should we contact the customer to find out if they have authorized the debit entries?

Are the ACH debits submitted as consumer or corporate transactions? Corporate debits to a consumer account (and vice versa) can be returned automatically.

Do you tell that under the Standard Entry Class code? It's coming through as a CCD.

Researching the account further, we've found evidence that the personal account is acting as a business account - large check deposits indicate check cashing activity. So, there's more going on here than I originally thought.

You really should not pay the entries as the whole thing could be a mistake. On the other hand, it more than likely is not a mistake with your customer DBA the named company - meaning that the customer needs to open an account under the company name, including documentation to support ownership. This could add up to a huge problem if the debits are not authorized.