Fraud can (and does) lurk around every corner – and electronic payments are no exception. Since the legalities, liabilities, and recovery options vary depending on the situation, your team needs a firm understanding of the rules and ways to mitigate losses. This detailed common-sense webinar is just the ticket.
- Distinguish between the liabilities of the ODFI and RDFI for ACH payment fraud
- Explain your institution’s responsibilities when acting as the ODFI versus the RDFI
- Define the return deadlines for consumer accounts and corporate accounts under the Nacha rules regarding ACH fraud
- Understand how to bring a breach of warranty claim against the ODFI after the return deadlines
- Identify when Reg E conflicts with the Nacha rules and when your institution must reimburse consumer accounts for ACH fraud
- Discover ways to encourage the RDFI to return funds to your institution after the ACH fraud is identified
The tremendous increase in electronic payment fraud has caused staggering losses to financial institutions. Your institution’s liability for electronic payment fraud will vary depending on the type of fraud, how it occurred, and whether it was a consumer or commercial account.
The varying legalities are mindboggling. UCC Article 4A permits financial institutions to shift liability to commercial accountholders in certain situations, while Regulation E provides much more protection to consumers. The Nacha rules make the originating depository financial institution (ODFI) ultimately liable for an unauthorized ACH, but it is difficult to get the ODFI to pay after the return deadlines. In all situations, however, the law requires financial institutions to use commercially reasonable security procedures. This webinar will explain which party is liable for the various types of electronic payment fraud and what can be done to protect your institution from liability in both commercial and consumer situations.
Elizabeth Fast, JD & CPA, Spencer Fane LLP
Elizabeth Fast is a partner with Spencer Fane LLP where she specializes in there presentation of financial institutions. Elizabeth is the head of the firm’s training division. She received her law degree from the University of Kansas and her undergraduate degree from Pittsburg State University. In addition, she has a Master of Business Administration degree and she is a Certified Public Accountant. Before joining Spencer Fane, she was General Counsel, Senior Vice President, and Corporate Secretary of a $9 billion bank with more than 130 branches, where she managed all legal, regulatory, and compliance functions.