ACH Death Notification Entries (DNEs) & Reclamations: Your Bank’s Liability

The U.S. Department of the Treasury, the Bureau of the Fiscal Service (Fiscal Service), Defense Finance and Accounting Service (DFAS), and the Federal Reserve Bank of Philadelphia have implemented an email delivery option for ACH reclamations. 

While Nacha Operating Rules apply to federal ACH transactions, the Green Book provides exceptions for handling DNEs (Death Notification Entries) and Federal Government Reclamations. This session covers the proper response to DNEs and Reclamations, including a side-by-side comparison of Commercial vs. Government Reclamations to clarify their differences and handling procedures.

Processing ACH Reclamations from the Federal Government can be challenging!  Chapter 5 of the Green Book has been updated, making it mandatory for Financial Institutions to respond to all reclamations submitted through the Automated Reclamation Processing System (ARPS) located in Treasury’s Pay.gov web portal (except for responses by DFAS and any Treasury-approved exceptions).

DNE’s (Death Notification Entries) need special handling, details are covered.

This session will identify how to complete the Federal Reserve Bank FedMail® Request Form (PDF) to get signed up for this email service. Misdirected payments are ALWAYS a HOT topic – what to do and your liability as a financial institution will be included in this VERY detailed session. Comparison of Federal Government Reclamations vs Commercial Reclamations is demonstrated using scenarios.

This 90-minute session will discuss details about how processing federal government payments differs from the NACHA Operating Rules. You will learn what the green book is and how this valuable on-line tool will help you with processing DNE's and federal government reclamations. Commercial reclamations have less liability and differ greatly from processing federal government reclamations; the speaker will cover details on each, including the difference between the two types of reclamations.

• Detailed processes on handling Death Notification Entries (DNE's)
• Timeframes on returning ACH Entries when account holders are deceased
• Descriptions of return reason codes to use when returning federal government benefit payments for deceased account holders
• Correctly processing federal government reclamations
• Timeframes for responding to government reclamations
• Difference between commercial and government reclamations

• What is the Green Book and where is it located?
• Recent UPDATES to 31 CFR Part 210 and the Green Book
• Where in the Green Book do I find details on DNEs and government reclamations
• 31 CFR (Code of Federal Regulation) - Part 210 --- how this applies
• Process on properly handling Death Notification Entries (DNE's)
• Process on returning deceased account-holders federal government benefit payments
• Process on handling commercial reclamations, timeframes and returns
• Major differences for banks liability for commercial vs. federal government reclamations

In the ACH network, Death Notification Entries (DNEs) and Reclamations help prevent improper payments after an account holder’s death. When a federal agency, like the SSA, learns of a recipient’s death, it sends a DNE to notify the receiving bank. If benefits continue to be deposited, the agency may issue a Reclamation, requiring the bank to return the funds. Financial institutions must follow strict liability rules and deadlines to avoid financial loss and regulatory penalties.