We have a client, ABC, that has taken ACH payments that have an individual name of another business, XYC. ABC has DBA filed with SOS but has not sent in updated signature cards stating the DBA. The account officer cannot understand why we would have an issue with this. I think that we should be accepting payments only into like titled accounts.

The question, is it enough to have just the SOS documentation showing the DBA or are we, the Bank, better protected with the signature card?

Technically, the sender of the ACH would be on the hook for sending something to the wrong account. Many banks are now monitoring for this to prevent IRS tax fraud (multiple fraudulent tax refunds coming into one account), but it really is a bank decision to make.

That's actually how I found it, using our fraud software looking for tax refunds.

Thank you.