Our data processor sent us a letter saying we were required to establish and implement expedited re-credit procedures to hand disputes arising from the receipt of an IRD. Are these something that need to be in writing to give to customers?

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Boomermom,
You are not required to give expedited recredit to all claimants. So, you have a practical need for two sets of procedures, one for customers eligible for expedited recredit; e.g. consumers receiving substitute checks, and a second for customers who make claims, but are not eligible for expedited recredit. An example of the latter would be a business that has had a substitute check posted to its account for the second time, whether it's in paper or image form, or a consumer filing a claim outside the 40 day time limit.

The procedure for handling claims not eligible for expedited recredit will be more difficult to develop because the regulations do not provide a structure. For example, a small business customer has had the same check for $9,800 paid as a substitute check twice. They cannot make their payroll tomorrow. What do we do?

I'm curious about the wording of your DP vendor's letter saying establishing these procedures is something you are required to do. In any case, they are not something you would share with a customer.

Thanks, Ken. I had not understood that anything needed to be in a form to give to customers. Just the wording of the letter we received got me to wondering.

Thank you for posting the procedures they are great!! Did you also use them as a board approved policy or do you know if that is also required?

No we did not present this as policy to the board. This was created as a procedures manual for the Data Processing department to aide the employees who would be directly responsible for recrediting provisions of Check 21.

As a bank that does not send or receive images, it was important for us to have procedures in writing to follow since we will be more susceptible to these claims.

MackenzieS