Update at a Glance

August 27, 2009

Web Session on New International ACH Transaction SEC Rule Available

NACHA's (The Electronic Payments Association's) latest Standard Entry Class (SEC) Code, known as IAT (International Automated Clearing House [ACH] Transaction), went into effect September 18, 2009. BNY Mellon Treasury Services' ACH originating and receiving clients need to be aware of changes they may have to make to be fully compliant with the new rule.

To help our clients understand these changes, the latest installment to our online library of informational cyberconferences, titled "International ACH Transactions," is currently available. This 25-minute, ondemand Web session outlines the steps necessary for ACH originators to comply with IAT, including the need to contact payees about the new standard. It also provides details on how BNY Mellon's ACH service has been updated to accommodate the rule requirements.

The new rule, which requires the identification of all international payments made through the ACH network, will affect how certain transactions must be issued and named, and calls for the reclassification of some transactions that are currently treated as domestic.

ACH receiver and originator organizations that are not in compliance with the new regulation as of the deadline are subject to Office of Foreign Assets Control (OFAC) sanctions and NACHA fines that carry severe penalties. And, once the IAT SEC rule goes into effect, organizations may experience delays in the processing of their ACH transactions, as OFAC will require financial institutions to screen and clear both inbound and outbound ACH IAT entries.

You can log on to www.bnymellon.com/iatupdates to access our extensive toolkit about the new rule. The site includes an online training course, sample communications to share with your clients, and varied resource materials to help your organization understand compliance.

Additionally, NACHA offers its own set of extensive resources that helps ACH originators decipher compliance issues and describes how their organizations may be impacted by the new standard. These tools include definitions, step-by-step instructions and training sessions, and are available via NACHA's Web site at www.nacha.org/IAT_Industry_Information.

For more information, call us at 1 800 424-3004 (Option 2) or e-mail us at treasury@bnymellon.com.