June 28, 2013
Maribel Bondoc
Manager, Network Rules
NACHA- The Electronic Payments Association
13450 Sunrise Valley Drive, Suite 100
Herndon, Virginia 20171
RE: Request for Comment – Clarification of Third Parties in the ACH Network
Dear Ms. Bondoc:
On behalf of the National Association of Federal Credit Unions (NAFCU), the only trade association that exclusively represents federal credit unions, I write to you regarding the request for comments issued by NACHA–the Electronic Payments Association (NACHA) to clarify provisions in the NACHA rules that implicate third parties in a transaction.
The proposed rule would clarify the definitions, roles and responsibilities of third parties in the ACH Network. It would require clear identification of the originator in consumer debit authorizations and the NACHA rules would acknowledge that a receiver’s authorization could have been provided to the originator or its third party provider. In addition, it would revise the definition of “third-party sender” so that it is clear that an ACH participant cannot act as both a third-party sender and an originator in the same transaction. The definition of “third party service provider” would be revised to clarify that third party service providers would be able to perform certain functions on behalf of third party senders.
NAFCU generally supports the proposed changes. We agree that that the proposed changes and clarifications would facilitate better understanding about the roles, responsibilities and rules applicable to different ACH participants. Among other things, clearly delineated rules help credit unions better manage their third party relationships and arrangements.
While we support the proposal, we urge NACHA to ensure that network participants, especially smaller institutions like credit unions, are given adequate time to make any necessary changes to their systems or other aspects of their operations. We also request that NACHA provide further guidance and examples on how the rules apply to and affect the relationships between the parties, especially the relationship between third party senders and third party service providers.
NAFCU appreciates the opportunity to comment. Should you have any questions, please feel free to contact me at ttefferi@nafcu.org or (703) 842-2268.
Sincerely,
Tessema Tefferi
Senior Regulatory Affairs Counsel