ARPR Additional Neach Flashcards by Charla Mulanax

Is a TPS always a TPSP

Yes

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Embedded computer chip with financial and personal information for payment transactions

Contactless Cards

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Implemented by the clearing house

RTP

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global open body formed to develop, enhance, disseminate and assist with understand of security standards for payment account data security

PCI SSC

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Path the check follows

Check Clearing

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Check Collection

Settlement

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Card Holder, Card Issuer, Merchant, Acquirer, Card Network

Card Payment Participants

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Issue a debit card regardless of where demand deposit is held

Flow on ACH Rail- Decoupled Card

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Credit push- Real Time Gross Settlement

Fedwire Funds Services

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Debit Pull-electronic book entry securities also real time

Fedwire Securities Service

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Non-profit with a special committee focus on standard for Bankcards and financial communications

ANSI American National Standards Institute

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Sender, Sending Participant, TCH, Receiving Participant, Receiver

RTP

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Sender, Participant, Service, Receiver

Fed Now Service

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National securities clearing corporation is regulated by the

Securities and Exchange Commission (SEC)

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Ach clears though these two networks

FRB and EPN

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Increases controls for cardholder data

PCI DSS Data Security Standard

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Build and maintain secure network
protect cardholder data
maintain vulnerability management program

PCI SSC 1-6

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Implement strong access control measures
regularly monitor and test network
maintain information security policy

PCI SSC 7-12

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System of Internal Controls, Monitoring and reporting
Independent auditing and testing
Designation of a compliance officer
ongoing training
CDD program

5 Pillars of BSA

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created CFPB and Established UDAAP

Dodd Frank

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If ACH is held we can hold for 1 day and have to notify

ODFI

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2021 Federal Open Market Committee FOMC

Reserve Framework reduced to Zero -New Reg D

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Subpart A checks clear
Subpart B Wires
Subpart C FedNow

Reg J

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Reg II is also the

Durbin Amendment

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national bank circular that covers payments, payments systems, and risk and risk management practices

OCC 2021-49

“Bank management is responsible for establishing effective risk management systems and controls and regularly reporting to the board on the results of the ACH program”

OCC 2006-39 Bulletin states for ACH activities

Mitigation business resiliency business continuity information security operational controls

ACH Operational Risk Mitigation

Failure in the transaction process can result in risk to FI's

Earnings and Capital

system will allow items to be transmitted and settled either through the check collection system or as an ACH transaction

RDC Least cost routing

OCC states bank should ensure comprehensive risk management and oversight of third-party relationships involving what activities

Critical (payments, settlement and information technology)

Technique that uses historical results to predict future outcomes

trend analysis

Before implementing RDC, FI must evaluate what type of risk

Reputational Operational Legal

What indicates risk for individual credit exposure

Risk Rating

Right to audit, monitor and inspect a participant participants conduct a self-audit establish controls on the gross value RTP payments may originate daily

Risk Controls Established By TCH

Name DOB Address Identification #

Four Pieces of CIP

Appy to all entities that store process and transmit cardholder data

PCI Standards

enacted to have ACH operators to compete with FR

Monetary Control act of 1980

ERM PROCESSES WILL PROVIDE MANAGEMENT WITH A BETTER UNDERSTANDING OF HOW RISK WILL IMPACT THE CHOICE OF____

STRATEGY

What influences and aligns strategy and performance throughout all departments and functions

Risk

methods include risk sharing risk avoidance risk analysis

Risk Management

What relationship that involves payments, settlement, and information technology warrant a comprehensive and rigorous oversight and management

Third party relationships

applies to and organizations applies to a department or a category. It encompasses all internal risk profiles, and may vary significantly based on many factors

Risk Profile

identifies, measures and prioritizes risk areas

Risk Assessment

preventative and detective control

encryption

FDIC OCC CFPB

Federal Governing Body

Added a broad set of rules for credit card issuers that limit the assessment of certain types of fees and the interest that may be charged

Credit Card Accountability Responsibility and Disclosure Act of 2009

payment order transmitted directly to or from a reserve bank by electronic data transmission excluding transmission via phone

Online Payment order

FI should have these to ensure retail payment operations are conducted appropriately

Comprehensive contract provisions and Adequate due diligence processes

How often is unnecessary data to be purged for PCI DSS

Quarterly

Credit Score, daily per transaction limits and new account vs existing accounts are a part of the selection and protection criteria for

cross channel risk

this program provides unbanked beneficiaries a way to receive payments electronically

Direct express

risk that action taken by a government may affect a payment system or participants in a payment system

sovereign risk

Due diligence for correspondent and private banking accounts title III and the bank secrecy act the effort to combat international money laundering and block access by terrorists to the US financial system

USA Patriot ACT

internal audit own and manage risk control ensure that expertise and process excellence are available to manage and control risk

coso's three lines of defense model

express overall appetite by using broad statements express risk appetite for each major class of organizational objectives express risk appetite for different areas of risk

communicating risk appetite

risk assessment control activities control environments info and communication monitoring

5 key components internal control program

governance and culture strategy and objective setting performance review and revision info communication and reporting

ERM framework

establish and revise communicate monitor and reinforce

risk appetite steps

credit push only

RTP

Administrative Technical Physical

Nature related Controls

when did checks become local

first quarter of 2010 by Reg CC

Availability Confidentiality data integrity

Information Security Components

funds held by an institution during the check clearing process before being made available to a depositor

Float for checks

set of security requirements surrounding the properties and management of devices used in the protection of cardholders PIN and other card payment processing activities

PCI-PTS

ensure organizations operate effectively, safeguard assets produce reliable financial records and maintain compliance with Regs and laws

Internal control program

provisions that require all non-tax related payments made by the federal government be made via electronic funds transfer EFT

Debt Collection improvement act of 1996

Feature unique to contactless cards that supports the use of improves security including authenticated information access

Microcontroller

Reg CC does not apply to

Debit Cards RDC and Mobile Deposits

What payment channel is particularly vulnerable to Cross Channel Risk

RDC

digital certificates public key infrastructures and encryption

secure data transmission

may engage a third-party independent sales organization or membership service provider to conduct and monitor day to day activities or its merchants accounts

acquiring bank

dual message one containing authorization decision and the second that contains data required for clearing and settlement

signature authenticated transactions

development of the routing # a policy and the national standard for imprinting checks with magnetic ink character recognition

automation of the check clearing process

should reflect the nature and complexity of the institution's participation in retail payment systems

FI Risk management strategy

desirable prohibited and restricted originators background check or originators creditworthiness

Onboarding ACH Originators

who does direct access apply to

ACH

Applies to any entity that collects uses or stores the personal data of people in the European union

GDPR

Establish reasonable controls and requirements to achieve policy objectives

Standards

9 Digit Routing 18 onus 12 Account fields

MICR Line contains

risk of not successfully moving the payment between the buyer and the seller or having the payment altered in some way during the process

Transit Risk

possibility that one to more parties will fail to deliver on the terms of a contract at the agreed upon time

Settlement Risk