Re-initiating a Virtual Check transaction after it has been returned

Description

Can I re-initiate a virtual check transaction after it has been returned?

Resolution

Recently, NACHA republished the regulation for re-initiating returned items. We would like to take this opportunity to pass this along to you and remind you of the importance of following all payment regulations. Fines for processing transactions outside of the parameters can range from $1,000 to $500,000. Below is the regulation as it appears in the NACHA Operating Rules and a complete list of rules can be found at http://www.achrulesonline.org/

Article 6 - Return, Correction, and acknowledgment of entries and entry information

Subsection 6.1.7: Re-initiating of Return Entries by Originating Depository Financial Institutions (ODFI)

An entry that has been returned may not be re-initiated unless (1) (a) the entry has been returned for insufficient or uncollected funds; (b) the entry has been returned for stopped payment and re-initiate has been authorized by the Receiver, or (c) the ODFI has taken corrective action to remedy the reason for the return and (2) the entry is re-initiated within 180 days after the settlement date of the original entry.

Section (c) of the rule applies to R02 (account closed), R03 (unable to locate account), R04 (invalid account number), and R29 (corporate customer advises not authorized).

Returned items that meet the guidelines above may be represented a maximum of two times after the original presentment.

If you have questions or require additional information, please submit a ticket and we will be in touch with you shortly.