International ACH Transactions (IAT) Changes

Customer Notification

Please read this communication carefully as these regulatory changes may affect you.

The Office of Foreign Assets Control (OFAC) has changed the requirements for some domestic and foreign ACH transactions. On September 18, 2009, an amendment to the National Automated Clearing House Association (NACHA) Operating Rules became effective and requires all international payments made via the ACH Network to be identified using a new standard entry class (SEC) Code - IAT (International ACH Transactions). IAT Transactions are ones in which a credit or debit entry is part of a payment transaction involving a financial agency's office that is not located in the territorial jurisdiction of the United States.

This is one of the most significant rule changes NACHA has implemented. Therefore, it is important to identify if you are an International ACH Transactions (IAT) customer and implement the necessary changes to your procedures. Additionally, as an ACH Originator, you must understand, recognize and comply with all OFAC requirements as you are subject to the same penalties and fines as financial institutions for non-compliance.

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