[Code of Federal Regulations]

[Title 31, Volume 2]

[Revised as of July 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 31CFR210.6]



[Page 54-55]

 

                  TITLE 31--MONEY AND FINANCE: TREASURY

 

         CHAPTER II--FISCAL SERVICE, DEPARTMENT OF THE TREASURY

 

PART 210_FEDERAL GOVERNMENT PARTICIPATION IN THE AUTOMATED CLEARING HOUSE--Table of Contents

 

                            Subpart A_General

 

Sec.  210.6  Agencies.



    Notwithstanding ACH Rules 2.2.3, 2.4.5, 2.5.2, 4.2, and 7.7.2, 

agencies shall be subject to the obligations and liabilities set forth 

in this section in connection with Government entries.

    (a) Receiving entries. An agency may receive ACH debit or credit 

entries only with the prior written authorization of the Service.

    (b) Liability to a recipient. An agency will be liable to the 

recipient for any loss sustained by the recipient as a result of the 

agency's failure to originate a credit or debit entry in accordance with 

this part. The agency's liability shall be limited to the amount of the 

entry(ies).

    (c) Liability to an originator. An agency will be liable to an 

originator or an ODFI for any loss sustained by the originator or ODFI 

as a result of the agency's failure to credit an ACH entry to the 

agency's account in accordance with this part. The agency's liability 

shall be limited to the amount of the entry(ies).

    (d) Liability to an RDFI or ACH association. Except as otherwise 

provided in this part, an agency will be liable to an RDFI for losses 

sustained in processing duplicate or erroneous credit and debit entries 

originated by the agency. An agency's liability shall be limited to the 

amount of the entry(ies), and shall be reduced by the amount of the loss 

resulting from the failure of the RDFI to exercise due diligence and 

follow standard commercial practices in processing the entry(ies). This 

section does not apply to credits received by an RDFI after the death or 

legal incapacity of a recipient of benefit payments or the death of a 

beneficiary as governed by Subpart B of this part. An agency shall not 

be liable to any ACH association.

    (e) Acquittance of the agency. The final crediting of the amount of 

an entry to a recipient's account shall constitute full acquittance of 

the Federal Government.

    (f) Reversals. An agency may reverse any duplicate or erroneous 

entry, and the Federal Government may reverse any duplicate or erroneous 

file. In initiating a reversal, an agency shall certify to the Service 

that the reversal complies with applicable law related to the recovery 

of the underlying payment. An agency that reverses an entry shall 

indemnify the RDFI as provided in the applicable ACH Rules, but the 

agency's liability shall be limited to the amount of the entry. If the 

Federal Government reverses a file, the Federal Government shall 

indemnify the RDFI as provided in the applicable ACH Rules, but the 

extent of such liability shall be limited to the amount of the entries 

comprising the duplicate or erroneous file. Reversals under this section 

shall comply with the time limitations set forth in the applicable ACH 

Rules.

    (g) Point-of-purchase debit entries. An agency may convert to an ACH 

debit entry a check drawn on a consumer or business account and 

presented at a point-of-purchase. Agencies shall use the Point-of-

Purchase (POP) Standard Entry Class (SEC) code for entries to consumer 

accounts and the Cash Concentration or Disbursement (CCD) SEC code for 

entries to business accounts. The requirements of ACH Rules 2.1.2 and 

3.4 shall be met for such an entry if the Receiver presents the check at 

a location where the agency has posted a conspicuous notice at the 

point-of-purchase containing the disclosure set forth at appendix A to 

this part and makes available to the Receiver, in a form that the 

Receiver can retain, the disclosure set forth at appendix B to this 

part. For purposes of ACH Rules 3.10 and 4.1.1, authorization shall 

consist of a copy of the notice and a copy of the Receiver's source 

document.

    (h) Accounts receivable check conversion. (1) Conversion of consumer 

checks.--An agency may originate an Accounts Receivable (ARC) entry 

using a check drawn on a consumer account that is



[[Page 55]]



received via the mail or at a dropbox, or that is delivered in person in 

circumstances in which the agency cannot contemporaneously image and 

return the check. The notice and authorization requirements of ACH Rules 

2.1.4 and 3.6.1 shall be met for an ARC entry only if an agency has 

provided the Receiver with the disclosure set forth at appendix C to 

this part.

    (2) Conversion of business checks. An agency may originate an ACH 

debit using a business check that is received via the mail or at a 

dropbox, or that is delivered in person in circumstances in which the 

agency cannot contemporaneously image and return the check. The agency 

shall use the CCD SEC code for such entries, which shall be deemed to 

meet the requirements of ACH Rule 2.1.2 if the agency has provided the 

disclosure set forth at appendix C to this part. For purposes of ACH 

Rules 3.10 and 4.1.1, authorization shall

    (i) Returned item service fee. An agency may originate an ACH debit 

entry to collect a one-time service fee in connection with an ACH debit 

entry originated pursuant to paragraph (g) or (h) of this section that 

is returned due to insufficient funds. An entry originated pursuant to 

this paragraph shall meet the requirements of ACH Rules 2.1.2 and 3.4 if 

the agency has complied with the disclosure requirements of paragraph 

(g) or (h), as appropriate. For purposes of ACH Rule 3.10 and 4.1.1, 

authorization shall consist of a copy of the notice provided under 

paragraph (g) or (h), as applicable, and a copy of the Receiver's source 

document.



[64 FR 17487, Apr. 9, 1999, as amended at 67 FR 17903, Apr. 11, 2002; 69 

FR 13189, Mar. 19, 2004]