APRP Exam Flash Cards
1. ACH Network is governed by these rules and regula- ACH Rules
tions.
EFTA and Regulation E
Regulation CC
Regulation D
31 CFR Part 203, 208, 210,
& 370
UCC Articles 4 & 4A
BSA/AML
State EFT Acts
FRB Operating Rules Cir-
cular 4
Private Sector ACH Opera-
tor Rules
OFAC
2. Emerging payments are governed by these rules and Generally, these are ACH
regulations. or card transactions;
therefore, the respective
payment system rules and
regulation would apply.
3. Check payment system is governed by these rules and Regulation CC..
regulations. UCC Article 3.
UCC Article 4.
, APRP Exam Flash Cards
Regulation J Subpart A.
F.R.B. Operating Circular
3..
E.C.C.H.O Rules
4. Examples of credit risk with wire payments. 1. Originator/Sender
Bank makes an irrevoca-
ble payment on behalf of
a customer through an ex-
tension of credit.
2. Beneficiary Bank does
not post the payment
properly.
5. Card payment system is governed by these rules and 1. Regulation E
regulations. 2. Regulation Z
3. Card Association Rules
6. Examples of credit risk with emerging payments. 1. Failure or bankruptcy of
entity initiating payment.
2. Funds availability pri-
or to receiving final settle-
ment.
3. Per-transaction dollar
limits being set too high
4. Funds unavailable to
satisfy debit return
7. Maximum timeframe an ODFI is exposed to credit risk 1. up to 60 days from
for ACH debit origination. the Settlement Date for
consumer Standard Entry
Class (SEC) codes per the
ACH Rules.
, APRP Exam Flash Cards
2. Up to 60 days from
the consumer's statement
date per Regulation E.
8. Examples of credit risk with card payments. 1. Merchant de-
clares bankruptcy, com-
mits fraud or is otherwise
unable to pay its charge-
backs causing the Acquir-
ing Financial Institution to
pay the Card Issuer.
2. with EMV, the Card is-
suer may encounter credit
risk due to fallback trans-
action.
9. Examples of credit risk with ACH debit payments. 1. ODFI is unable to recov-
er funds from Originator
for returned debit entries
2. RDFI is untimely in re-
turning debit entries
10. Maximum timeframe an ODFI is exposed to credit risk Up to two banking days.
for ACH credit origination.
11. Examples of credit risk with ACH credit payments. 1. Originator fails to fund
ODFI for credit entries ini-
tiated.
2. RDFI posted credit entry
prior to settlement Date.
12. Examples of fraud risk with check payments. 1. Lost or stolen check
2. Alteration of deposited
1. ACH Network is governed by these rules and regula- ACH Rules
tions.
EFTA and Regulation E
Regulation CC
Regulation D
31 CFR Part 203, 208, 210,
& 370
UCC Articles 4 & 4A
BSA/AML
State EFT Acts
FRB Operating Rules Cir-
cular 4
Private Sector ACH Opera-
tor Rules
OFAC
2. Emerging payments are governed by these rules and Generally, these are ACH
regulations. or card transactions;
therefore, the respective
payment system rules and
regulation would apply.
3. Check payment system is governed by these rules and Regulation CC..
regulations. UCC Article 3.
UCC Article 4.
, APRP Exam Flash Cards
Regulation J Subpart A.
F.R.B. Operating Circular
3..
E.C.C.H.O Rules
4. Examples of credit risk with wire payments. 1. Originator/Sender
Bank makes an irrevoca-
ble payment on behalf of
a customer through an ex-
tension of credit.
2. Beneficiary Bank does
not post the payment
properly.
5. Card payment system is governed by these rules and 1. Regulation E
regulations. 2. Regulation Z
3. Card Association Rules
6. Examples of credit risk with emerging payments. 1. Failure or bankruptcy of
entity initiating payment.
2. Funds availability pri-
or to receiving final settle-
ment.
3. Per-transaction dollar
limits being set too high
4. Funds unavailable to
satisfy debit return
7. Maximum timeframe an ODFI is exposed to credit risk 1. up to 60 days from
for ACH debit origination. the Settlement Date for
consumer Standard Entry
Class (SEC) codes per the
ACH Rules.
, APRP Exam Flash Cards
2. Up to 60 days from
the consumer's statement
date per Regulation E.
8. Examples of credit risk with card payments. 1. Merchant de-
clares bankruptcy, com-
mits fraud or is otherwise
unable to pay its charge-
backs causing the Acquir-
ing Financial Institution to
pay the Card Issuer.
2. with EMV, the Card is-
suer may encounter credit
risk due to fallback trans-
action.
9. Examples of credit risk with ACH debit payments. 1. ODFI is unable to recov-
er funds from Originator
for returned debit entries
2. RDFI is untimely in re-
turning debit entries
10. Maximum timeframe an ODFI is exposed to credit risk Up to two banking days.
for ACH credit origination.
11. Examples of credit risk with ACH credit payments. 1. Originator fails to fund
ODFI for credit entries ini-
tiated.
2. RDFI posted credit entry
prior to settlement Date.
12. Examples of fraud risk with check payments. 1. Lost or stolen check
2. Alteration of deposited
