Mastering Check Adjustments

Transcription

1 Mastering Check Adjustments

2 Presented by Jessica Johnson, NCP, AAP

3 Introduction to Check Adjustments Purpose of a Check Adjustment» Request correcting entry for a specific item or group of items within a cashletter.» Request further research on specific items or entries. Determining if a Check Adjustment is needed» Bank Reconcilement» Customer Reconcilement and Notification

4 Locating Check Adjustments in NetLink Locating Adjustments and Documentation Applications Check Adjustments Outgoing Adjustments Incoming Adjustments Documentation (Fed)

5 Incoming Check Adjustments

6 Incoming Fed Check Adjustments Applications Check Adjustments Incoming Adjustments View Fed Transactions Preview

7 Incoming NetLink Exchange Adjustments Applications Check Adjustments Incoming Adjustments View NetLink Exchange Transactions Preview

8 Incoming NetLink Exchange Adjustments Resolution to your Request Incoming Advice

9 QUESTIONS?

10 Outgoing Check Adjustments

11 Submitting Outgoing Check Adjustments Applications Check Adjustments Outgoing Adjustments Add Tab

12 Selecting the Clearing Network Clearing Networks» Federal Reserve Items in your incoming Image CL. Items in your Incoming and Outgoing Return CL s.» NetLink Exchange Items in your Outgoing Forward CL. Items in your incoming WIN Exchange CL.

13 Check Adjustment Types Case Open: To open a new case. Case Acknowledgement: Response sent to acknowledge a received case. Case Status Inquiry: Inquire on status of a pending case. Case Resolution: Response sent to resolve a case. Case Status Inquiry Response: Response to an inquiry on an open case. Case Cancellation: Cancel a submitted case.

14 Information Fields Sender ABA Number» Your Bank s Routing Number Receiver ABA Number» Federal Reserve: Atlanta RT ( )» NetLink Exchange: FNBB s RT ( )

15 Investigation Types

16 Investigation Types Cont d. Encoding Error (ENC): An item was clearly encoded for an amount different than the legal (written) amount or the written amount differs from the stated amount in the ANSI X9.37 image cash/return letter. Paid (PAID): Request for entry for an item that is being refused either because it is the original (or the legal equivalent, i.e. a substitute check or image received in an ANSI X9.37 cash/return letter) or a photocopy and the other has already paid. (No Min. amount/cannot submit Debit to Fed) Noncash Item (NCH): Request for entry for a non-valid item (zero-value) that was included in the cash/return letter total or an item that does not meet legal equivalence requirements for Check 21.(Cannot submit Debit to Fed) Entry In Error (ERR): Request to reverse/investigate an entry made in error.(no minimum amount) Duplicate Entry (DUP): Request to reverse/investigate a previous adjustment entry that appears to be a duplicate.

17 Investigation Types Cont d. Warranty/ Indemnity Claim (WIC):» Associated w/ Ck 21 items: Depository institution alleges breach of a Check 21 warranty or indemnity.» Associated w/ URCC: Paying institution alleges that the remotely created check was not authorized in the amount stated on the check to the payee indicated on the check. Source of Receipt (SOR): A request to identify the source of receipt of an item, including the routing number, and the associated cash/return letter information (date, total, bundle and sequence number). Photo Request (PREQ): A request for a photo/image of an item or a copy of a cash/return letter recap or detail listing. Original or Sufficient Copy Request (OSCR): Request for an original item or a sufficient copy of an item presented/returned in an ANSI X9.37 image cash/return letter or as a substitute check.

18 Investigation Types Cont d. Photo in Lieu (PIL): A photocopy is being submitted in response to a charge for a lost or destroyed item. Information Request (INFO): If you receive an entry or correspondence from the Federal Reserve and require additional information in order to complete your research, submit an adjustment request to the Federal Reserve that sent you the entry or correspondence. Advice Request (AREQ): Request to provide a copy of an advice or an attachment supporting an entry. Reclamation (RCLM): U.S. Treasury Check Reclamation Send authorization via to reclamations@phil.frb.org, fax to (215) or submit electronically to ABA # via FedLine Web access solution.

19 Investigation Types Cont d. Disposition (DISP): A request to identify where an item was presented/ returned, including the routing number, and the associated cash/return letter information (date, total, bundle and sequence number). Not Our Item (NOI): an item was charged in a cash/return letter which does not bear the receiving institution s routing number in the MICR line or endorsement area of the physical item or image or in the associated endorsement records for items received electronically.(no Min. Amount) Late Return Claim (LC): Depository institution alleges an item was returned late. (Must be $ or greater.) Later Return Disclaimer (LR): Drawee disputes the claim of late return. (Must be $ or greater.)

20 Investigation Types Cont d. Listed Error (LST): An item was listed and included in the cash/return letter total for an amount different than the encoded amount. If the item has both an Encoding Error (ENC) and a Listing Error (LST), handle as a Listing Error. Listed Not Enclosed (LNE): An item was listed and included in the cash/return letter total but was not received. Enclosed Not Listed (ENL): An item that includes your routing transit number was received without being listed on the cash/return letter and was not included in the cash/return letter total (not charged). Free Item (FREE): An item was found free (should not have been included in the cash/return letter) and is not drawn on or endorsed by the receiving institution.

21 Investigation Types Cont d. Extra Cashletter Credit (ECLC): Request to investigate a cash/return letter credit which the receiver is unable to reconcile. Incorrect Cashletter Credit (ICLC): Request to investigate a cash/return letter credit for which the depositor believes was functioned for an incorrect amount. Late Cashletter Credit (LCLC): Request to investigate a cash/return letter believed to have been credited untimely (late).

22 Investigation Types Cont d. Missing Bundle (MBDL) or Missing Cash/Return Letter (MCL): Request for credit for a cash/return letter or bundle that was charged but never received. Extra Bundle (EBDL) or Extra Cash Letter (ECL): Request for debit for a cash/return letter or bundle that was received at the correct location without entry. Expedited Recredit Claim (EXCR): Request for expedited recredit associated with an eligible substitute check presented/returned in a cash/return letter.

23 QUESTIONS?

24 Case Information Fields Amount: Amount of your request. Entry Type: Credit, Debit or Request for Information. Sender Reference: Sender created reference for case submitted. Receiver Reference Number: Only used in reference to an incoming adjustment Accounting Entry Identifier: 4 digit reference number found on your FNBB statement Contact Name & Phone Number: In regards to questions about the case.

25 Case Information Fields Cont d. From Cash Letter: ABA of the FI the CL was received from. To Cash Letter: ABA of the FI the CL was sent to. Product Type: Type of CL the item was located in. Document to Follow: Fax or Mail, if applicable. Comments: Pertinent information regarding your request. Advice Type/Expected Date of Credit/ Date Credit Received: Required field if a red X is present.

26 To & From Cashletter Fields Decoded From Cash Letter /To Cash Letter» Incoming WIN Exchange Cash Letter From Cash Letter: FNBB s ABA To Cash Letter: Your Bank s ABA» Incoming Fed Receipt Cash Letter From Cash Letter: FRB s ABA To Cash Letter: Your Bank s ABA» Incoming Return Cash Letter From Cash Letter: FRB s ABA To Cash Letter: Your Bank s ABA

27 To & From Cashletter Fields Decoded From Cash Letter /To Cash Letter fields» Outgoing Return Cash Letter From Cash Letter: Your Bank s ABA To Cash Letter: FRB s ABA» Outgoing Forward Cash Letter From Cash Letter : Your Bank s ABA To Cash Letter : FNBB s ABA Quick Reference: FRB s RT: FNBB S RT:

28 Item ID Fields Cash Letter/Entry Date: Date of the CL that included the item or in the case of an entry, the date of the actual entry. Cash Letter Total: Total of the CL that included the item. Tape Total: Total of the tape/batch that included the item. Sequence Number: Sequence number of item being adjusted. Item Before: Item located before adjusted item in CL. Item After: Item located after adjusted item in CL. Listed As: Amount Item read for in CL. Should Be: Legal amount item is payable.

29 Item ID Fields Cont d. From Cash Letter: ABA of the FI the CL was received from. To Cash Letter: ABA of the FI the CL was sent to. Cash Letter/Entry Date: Date of the cash letter that included the item or in the case of an entry the date of the actual entry. Sequence Number: Sequence number of item being adjusted.

30 Item Details Fields Drawee Bank: ABA the item is drawn on (bank by which the check is payable). Depository Bank: ABA of bank of first deposit. Maker: Holder of the account who the check is drawn on. Payee: Person/Business who the check is written to. Maker s Account Number: Account number the check is drawn on. Check Number: Serial number of check.

31 Viewing Outgoing Adjustments Applications Check Adjustments Outgoing Adjustments View Transactions Magnifying Glass Icon: Preview/Print Two Page Paper Icon: View/Print DTF Cover Page

32 QUESTIONS?

33 Helpful Hints

34 Processing Times & Dollar Limits Federal Reserve Adjustments» Incoming Adjustments: Uploaded at 10am, 2pm and 4pm CT» Outgoing Adjustments: Downloaded at 12pm and 3pm Netlink Exchange Adjustments» Incoming Adjustments: Delivered until 4pm» Outgoing Adjustments: Next day entry received if submitted by 2pm Check Adjustment Dollar Limits» NetLink Exchange: $10.00 (PAID & ERR no minimum)» Federal Reserve: $25.01 (PAID,ERR, & NOI no minimum) Late Return Claims/Response $ minimum

35 Timelines for Submission» Federal Reserve Varies based on Investigation Type per the Check Adjustment Quick Reference Guide found at frbservices.org.» NetLink Exchange Processed within 1calendar year or per ECCHO s Adjustment Matrix found at ECCHO.org. Entry posted next business day provided all requirements are meet. Please take these guidelines into consideration when deciding how long to save original items.

36 Sending Documents to Follow Federal Reserve» No special characters included in Sender Reference number» No marks or writing on Cover Sheet» No headers or footers on Cover Sheet» DTF are required to be sent after adjustment is submitted Hint: Fax DTF s after 2pm next business day 5 Business days to send DTF Netlink Exchange DTF s can be faxed or ed anytime.

37 PAID Investigation Type Requirements 2013 Federal Reserve Requirement Changes: Provide 1 st presentment info in newly populated fields. Duplicate Certification Form no longer required. DTF no longer required except for a multiple item request. For those request provide listing with sequence number, RT, account number, check number, and amount of each item (6 Item minimum). NetLink Exchange Multiple PAID Items: (2 item minimum) If more than 10 items, please listing in excel format to adjustments@bankers-bank.com.

38 QUESTIONS?

39 Deciphering Investigation Types

40 Deciphering Investigation Types Duplicate Entry (DUP) Submitted for Duplicate Entries Submitted if you received an entry to your statement twice for the same item. Item Paid Twice (PAID) Submitted for Duplicated Items Submitted if you received or sent a check(s) twice in your incoming/ outgoing cash or return letter(s). Hint: A PAID adjustment should not be used for a Remotely Created Check. Submit a WIC associated with URCC for the additional item.

41 Deciphering Investigation Types Not Our Item (NOI) Submitted if an item is in an incoming paper CL and is not drawn on your bank. Submitted if an item is in an incoming Return CL and your bank is not the drawee nor the BOFD. Hint: You should not have a NOI in your Incoming Image CL. Noncash Item (NCH) Submitted if you receive an item in your Incoming Image CL that read your routing number in error. Notate MICR mismatch in comments section. Hint: Item can be in any CL Type.

42 Deciphering Investigation Types Item Paid Twice (Paid) Encoding Error (ENC) I have an item that paid twice, but one Item paid for an incorrect amount. Which type of adjustment should I submit?» If you have an item that PAID for the correct amount and for again for an incorrect amount, submit a PAID adjustment.» Submit the adjustment for the item that paid incorrectly. Notate in the comments that the item paid for two different amounts.» If the misencoded item has previously been adjusted as a encoding error, submit a PAID case for the item that paid correctly. Notate in the comments the two amounts the item paid for as well as the reference number pertaining to the encoding error adjustment.

43 PAID Adjustments with Mobile Deposit I received an item in my incoming cashletter twice being presented by two different BOFD s, how should I proceed?» This has become a common scenario in today s banking world due to Remote Deposit Capture(RDC) and Mobile Deposit.» You have the option to submit a PAID adjustment on either presentment of the item. If you are able to determine which item is deposited by RDC, the industry standard is to submit the adjustment on the RDC item to avoid Holder in Due Course (HIDC) claims.

44 PAID Adjustments with Mobile Deposit I received an adjustment for an item paid twice, but I have the original item. What options do I have?» If your customer deposited the original item and there is no indication that the item had been previously presented, they may have a Holder in Due Course claim(ucc 3-302) against the drawee.» HIDC is a claim that is usually done directly between maker and payee. In recent months, the industry standard is to handle HIDC claims through the banking system.» If you receive a PAID Netlink Exchange Adjustment and have the original item, you can submit an Entry in Error case. Notate in the comments that you are the holder of the original item and provide a copy of the original item.

45 QUESTIONS?

46 Non-Conforming Images

47 Non-Conforming Images»Items may not be processed because they: Fail Image Quality Standards Qualified to Invalid Routing Numbers Ineligible for Image Clearing

48 Non-Conforming Images»Image Quality Assurance (IQA) Standards address the following check characteristics: Darkness Size Document Skew: percentage the image can be skewed Noise: dots per inch Record Size: minimum and maximum of number of bytes for the image»electronic Checks that fail to meet these guidelines will potentially have unusable images.

49 NetLink Exchange NCI s Downloading NetLink Exchange NCI s»netlink Exchange Non-Conforming Images Download

50 NetLink Exchange NCI Advice Types

51 NetLink Exchange NCI Advice Types

52 NetLink Exchange NCI Advice Types

53 Non-Conforming Images How to Handle an NCI Determine why the item in being rejected» Physical Presentment» Machine Read Error» Operator Issue Correct the error and represent the item in your forward cashletter. If you are unable to correct the error or if the item continues to reject, present the item in a paper cashletter.

54 QUESTIONS?

55 Resources FNBB Client Services Department» (800) FNBB Electronic Products Department» (800) Ext. 6105» ECCHO» FRB Check 21 Service» (877) FRB Website» Check Adjustment Quick Reference Guide

56 From/To Cash Letter Quick Reference» Incoming WIN Exchange Cash Letter From Cash Letter: FNBB s ABA To Cash Letter: Your Bank s ABA» Incoming Fed Receipt Cash Letter From Cash Letter: FRB s ABA To Cash Letter: Your Bank s ABA» Incoming Return Cash Letter From Cash Letter: FRB s ABA To Cash Letter: Your Bank s ABA» Outgoing Return Cash Letter From Cash Letter: Your Bank s ABA To Cash Letter: FRB s ABA» Outgoing Forward Cash Letter From Cash Letter : Your Bank s ABA To Cash Letter : FNBB s ABA Quick Reference: FRB s RT: FNBB S RT: