Funds Transfer Verification

Good afternoon,
I have always been told that all wire transfers in the amount of $5,000 or more require a second verification by an employee other than the employee that accepted the instruction from the customer. I have been asked where this requirement is stipulated and am not able to locate it. Is it RegJ, UCC-4A, or BSA? I have checked all three with no success.

Thanks!
Michelle

It is an internal control issue.

Thank you. Are you saying that it is not required? Because it has been previously included in both internal and external audits.

No, it is not required unless buried somewhere in your State law, which I doubt. Most banks have established various levels for wire transfer approvals based on dollar amounts, as once the wire leaves the bank, it is gone forever.

And if it's stated in your policy as a requirement, it would be appropriate for an auditor or examiner to cite the bank if it failed to follow its own internal controls. And frankly, when auditors and examiners see one unenforced control, their radar is up looking for other unobserved controls.

If it is listed in audits, it is a risk limit/process your bank has in place. No regulatory requirement.

you may also want to check your funds transfer agreement with your customers, it could be embedded there. We have a mandatory callback in ours, but it is a much higher level. A customer may choose to require a callback on any amount based on how they complete the agreement.

We have a mandatory callback in ours, but it is a much higher level.

I hope you have some other commercial reasonable security procedures for the lesser amounts or management should be ready to just write these off, if there is a dispute. I'm not sure why approval on the bank side would have anything to do with an agreement with the customer?

It may be dictated by your insurance company. Our insurance policy states we can receive wires via email or fax.

But I also bet is says as long as the bank complies with UCC 4A-202

oh, gosh, never thought of that...

of course we do, but I didn't feel the need to provide superfluous information as it didn't provide benefit to the original post