Questions Flashcards
1
Q
The maximum number of addenda records for TRX,CTX and ENR entries is?
A
9,999
2
Q
What is the Amount of the non-refundable application fee to initiate an arbitration procedure ?
A
$250.00
3
Q
If the transaction type code field for an IAT entry contains a second SEC code - in what record will you find the check serial number and terminal ID?
A
Remittance addenda record
4
Q
What field contains the reason for payment as required by OFAC for IAT Entries?
A
Transaction type code field
5
Q
For a destroyed check entry transaction,what needs to be in the company name field?
A
Check destroyed
6
Q
Which of the following payment systems are referred to as real-time and gross settlement?
A
Fed wire funds transfer
7
Q
When was NACHA formed
A
1974
8
Q
Fed wire is subjected to what regulations?
A
Reg j and reg cc
10
Q
What requires virtually all non-tax related payments by the federal government to be made via electronic funds transfer?
A
Eft mandate
11
Q
What field contains the reason for payment as required by OFAC for IAT entries?
A
Transaction type code field
12
Q
What is the minimum amount of a arbitration claim?
A
$250.00
13
Q
Written and signed authorizations are required for which debit transactions?
A
Web,pop,ppd
14
Q
What is the time frame to return an unauthorized ACH corporate entry?
A
Available to the ODFI no later then opening of business on the second banking day following settlement date of original entry
15
Q
What is the maximum amount of days a bank has to respond to the reclamation entry before its federal reserve account is automatically debited for the full amount of the reclamation ?
A
60 calendar days
16
Q
What relates to the EFT mandate?
A
The debt collection improvement act of 1996
17
Q
What is the minimum amount of a commendation claim before in can be paid?
A
$200.00 per entry
17
Q
Which provision of UCC article 4a can be varied by agreement (with disclosure to originator)?
A
Choice of law
18
Q
As a prerequisite to origination,and to help control credit risk, an originating depository financial institution must have what in place for all the originators for which it transmits ACH entries ?
A
Exposure limits
19
Q
An ACH operator acting as a gateway must not process what?
A
Any debit inbound IAT entry, except for reversing entries
20
Q
What is the standard entry class code for an automated NOC?
A
“COR”
20
Q
According to Reg E, how any days prior notice is required when there is a change to the initial disclosures which results in greater consumer liability ?
A
21 days
21
Q
When a participant in the ACH NETWORK is unable to meet its financial obligation to another financial institution it is an example of what type of ACH risk?
A
Systemic risk
22
Q
Individual name field is mandatory for ?
A
Tel and web payments
23
Q
The two payment systems whose participations include the originator, originators depository institution,reserve banks, beneficiary a depository institution and beneficiary.
A
Fed wire funds and securities services
24
Special task force formed to develop a workable alternative to paper checks
Special committee on paperless entries (scope)
25
The year the location of the first ACH association
1972-California
26
Name the two ACH operators
Federal reserve bank and electronic payment network
27
Two basic types of checks in the collection cycle
On U.S. check and transit checks
28
Payment system governed by the electronic funds transfer act, reg z, card association rules and fair credit billing
Card payment system
29
Name the clearing and settlement methods for checks
Direct presentment, federal reserve bank, clearing house and correspondent bank
30
Payment system to which real-time, gross settlement applies
Wire transfer payment system
31
The year the routing number policy was adopted
1911
32
Payment system governed by the expedited funds availability act, UCC3,UCC4,OFAC,regulation cc and regulation j
Check payment system
33
Payment system to which net settlement applies
ACH network
34
An optional, variable format field of the MICR line of a check
Auxiliary on-us field
35
Payment system governed by the ACH rules, UCC4, UCC4A, Electronic funds transfer act, OFAC, REG E ,The right to financial privacy , reg D and reg CC
Ach network
36
A financial institution that received ACH entries from the ACH operator and posts the entries to the accounts of its depositors.
Receiving depository financial institution (RDFI)
37
Payment system governed by the ACH rules, UCC4, UCC4A, Electronic funds transfer act, OFAC, REG E ,The right to financial privacy , reg D and reg CC
Ach network
37
A financial institution that received ACH entries from the ACH operator and posts the entries to the accounts of its depositors.
Receiving depository financial institution (RDFI)
38
A person or entity that is issued a card or debit account that is accessed though the use of the card
Cardholder
40
A person or entity that is issued a card or debit account that is accessed though the use of the card
Cardholder
41
Financial institution identified by the routing number encoded on the MICR line of a check
Paying bank (payouts depository financial institution)
42
A third-party that sends ACH files on behalf of the ODFI. Examples include correspondent banks, corporate credit unions and processors.
Third-party sending point
43
The year the federal reserve system was created
1913
44
The party to whom a check is made payable
Payee
45
The first bank to which a check is deposited or transferred
Bank of first deposit(payees depository financial institution)
46
The party obligated to pay on a check
Payor(check writer, maker of drawer)
47
A voluntary association of depository institution that facilitate the clearing of checks or electronic items through the direct exchange of funds between members
Clearing house
48
Financial institution that creates an image of the original check
Truncating bank
49
ACH payment transactions are accumulated throughout the day , sent to the ACH operator, sorted by destination and transmitted in groups at specified times
Batch process, store-and-forward systems
50
The national trade association for electronic payment, which establishes the rule, industry standards and procedures governing the exchange of commercial ACH payment by depository financial institution
NACH-the electronic payment association
51
A financial institution the receives ACH entries from the ACH operator and posts the entries to the accounts or its depositors
Recording depository financial institution (RDFI)
52
The financial institution that contracts with a merchant to initiate payment requests to a card associated or company in the context of credit and debit card payment.
Acquirer/processor (merchant bank or merchant processor)
53
The central clearing facility for ACH transactions
ACH operator
54
An entity that issues a credit or debit card to the cardholder
Card issuer
55
The financial institution that contracts with a merchant to initiate payment requests to a card association or company in the context of credit and debit card payment
Acquirer/processor(merchant bank or merchant processor)
56
Risk that occurs when fraudulent or illegal payment transactions move from one payment channel to another( check payments to ACH )
Cross-channel risk
57
According to NACHA operating rules, the ODFI needs to keep a copy of the items to which each XXK entry pertains for?
6 year
58
Tolls to combat fraud risk
Personnel practices, physical security, data security, change controls and operational controls
59
Exposure limits criteria, at a minimum, should be based on
overall customer relationship, individual subsidiaries/divisions of company, historical or predicted dollar value of files processed and specific ACH application
60
The ACH security framework addresses these three areas
Protection of sensitive data and access controls, self-assessment and verification of originators and third-party senders
61
The central clearing facility for ACH transactions
ACH operator
62
Financial institution identified by the routing number encoded on the MICR line of a check
Paying bank (payouts depository financial institution)
63
Transaction set for tax return information
ANSI ASC X12.813
64
Name the originator benefits of direct payment via ACH
Improved cash flow/collections, time/labor reduction, lower administration and operating expense
65
Name the receiver benefits of direct deposit via ACH
No lost/ stolen checks, immediate funds availability, convenience
66
The year ANSI formed the accredited standards committee (ASC) X12
1979
67
Examples of financial EDI
Vendor express, state tax payment, child support payments and health care claim payments
68
A telecommunication intermediary used by corporations and financial institutions to transmit data
Value added network(VAN)
69
A debit entry initiated by an originator in accordance with the receivers oral authorization via the telephone. May be a single entry or recurring
Telephone-initiated(TEL)
70
A third-party that sends ACH files on behalf of the ODFI. Examples include correspondent banks, corporate credit unions and processors.
Third-party sending point
72
The party to whom a check is made payable
Payee
73
The first bank to which a check is deposited or transferred
Bank of first deposit(payees depository financial institution)
74
The party obligated to pay on a check
Payor(check writer, maker of drawer)
75
A voluntary association of depository institution that facilitate the clearing of checks or electronic items through the direct exchange of funds between members
Clearing house
76
Financial institution that creates an image of the original check
Truncating bank
77
An entity that issues a credit or debit card or debit card to the cardholder.
Card issuer
78
Financial institution that produces the substitute checks
Reconverting bank
79
ACH payment transactions are accumulated throughout the day , sent to the ACH operator, sorted by destination and transmitted in groups at specified times
Batch process, store-and-forward systems
80
The national trade association for electronic payment, which establishes the rule, industry standards and procedures governing the exchange of commercial ACH payment by depository financial institution
NACH-the electronic payment association
81
A financial institution the receives ACH entries from the ACH operator and posts the entries to the accounts or its depositors
Recording depository financial institution (RDFI)
82
The financial institution that contracts with a merchant to initiate payment requests to a card associated or company in the context of credit and debit card payment.
Acquirer/processor (merchant bank or merchant processor)
83
The central clearing facility for ACH transactions
ACH operator
84
An entity that issues a credit or debit card to the cardholder
Card issuer
85
The financial institution that contracts with a merchant to initiate payment requests to a card association or company in the context of credit and debit card payment
Acquirer/processor(merchant bank or merchant processor)
86
Risk that occurs when fraudulent or illegal payment transactions move from one payment channel to another( check payments to ACH )
Cross-channel risk
88
Tolls to combat fraud risk
Personnel practices, physical security, data security, change controls and operational controls
89
Exposure limits criteria, at a minimum, should be based on
overall customer relationship, individual subsidiaries/divisions of company, historical or predicted dollar value of files processed and specific ACH application
90
The ACH security framework addresses these three areas
Protection of sensitive data and access controls, self-assessment and verification of originators and third-party senders
91
The central clearing facility for ACH transactions
ACH operator
92
Two service provided by fed wire
Funds service and securities service
93
The Ach network is Not governed by what regulation?
Reg j
94
Transaction set for tax return information
ANSI ASC X12.813
95
Name the originator benefits of direct payment via ACH
Improved cash flow/collections, time/labor reduction, lower administration and operating expense
96
Name the receiver benefits of direct deposit via ACH
No lost/ stolen checks, immediate funds availability, convenience
97
The year ANSI formed the accredited standards committee (ASC) X12
1979
98
Examples of financial EDI
Vendor express, state tax payment, child support payments and health care claim payments
99
A telecommunication intermediary used by corporations and financial institutions to transmit data
Value added network(VAN)
100
A debit entry initiated by an originator in accordance with the receivers oral authorization via the telephone. May be a single entry or recurring
Telephone-initiated(TEL)
108
An entity that issues a credit or debit card or debit card to the cardholder.
Card issuer
109
Financial institution that produces the substitute checks
Reconverting bank
110
Method using one type of authentication factor
Single-factor authentication
111
Risk that a party to a transaction cannot provide the necessary funds as contracted for settlement to take place on the scheduled date
Credit risk
112
Controls systemic risk in the ach network
Ach operator
113
Risk presented when processors, sending or relieving points, or other parties performing a function of ach processing on behalf of a participant
Third party risk
114
A strategy used by an ODFI to establish one total exposure limit for multiple originators
Risk pooling
115
Method using two types of authentication factors
Two factor authentication
116
A method used by an ODFI requiring an originator to ensure funds are available prior to settlement of an ach transaction
Prefunding
117
Parties responsible for controlling operational risk in the ach network
ODFI and RDFI
118
A method used to mitigate credit risk, also required by the ach rules
Exposure limits
119
Method using more than two types of authentication factors
Multi factor authentication
120
A means of disbursing government benefits electronically
Electronic benefits transfer (ebt)
121
Transactions set for health care payments
ANSI ASC x12.835
122
Transaction set for payment order/remittance advice
ANSI ASC x12.820
123
Transaction set for lockbox
ANSI ASC x12.823
124
Transaction set for income or asset offset
ANSI ASC x12.521
125
Single entry debut initiated by an originator to an account of the recorder pursuant to a source document provided by the receiver at the point of purchase or at a manned bill payment location
BOC
126
Name the RDFI responsible for receipt of entries
1. timely receipt
2. posting
3. prenote validation
4. return of entries
5. proper notification to originator regarding NOCs
6. timely handling of remittance data
7. provide entry information to consumer receivers (periodic statements)
127
Deadline for the RDFI to transmit contested dis honored or corrected returns
2 banking days
128
A site where entries are received from an ach operator for processing
Receiving point
129
Originator of debit WEB entries are required to implement these risk management procedures
1. verification of receivers identity
2. fraudulent detection system
3. verification of routing numbers
4. annual audit of website security
