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Fed360

Mandatory change for FedGlobal® ACH payments to Canada

Any financial institution originating payments to Canada, whether using FedGlobal Canada Services or another mechanism, should be aware that effective June 1, 2021, all International ACH Transaction (IAT) transfers destined for Canada must include full address details for the beneficiary. This requirement is contained within Canada’s regulatory amendment to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, 2019:SOR/219-240. According to the amendment, the following beneficiary address information, which is currently optional, will become mandatory:

  • Address
  • City
  • State/Province
  • Zip/Postal
  • Country

NOTE: The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) guidance clarifies that address is defined as the physical address where the client lives or where the physical location of the place of business is found. Addresses consisting of a post office box are not acceptable. Address is defined as Street Number, Street Name, City, Province/State, Country, and Postal Code/Zip Code. Postal Codes and Zip Codes are applicable for jurisdictions where mandated.

Please be advised that this notification is only a high-level summary of the June 1, 2021, amendment. Each financial institution originating IAT transfers to Canada is encouraged to review the Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, 2019: SOR/2019-240 (Off-site) as well as the February 2020 Regulatory Impact Analysis Statement (Off-site).

Fed360

Synthetic identity fraud: Defined it to fight it

Synthetic identity fraud is reported to be the fastest-growing type of financial crime (Off-site) in the United States, accounting for billions in losses annually. Moreover, the use of multiple definitions for synthetic identity fraud throughout the industry poses a fundamental problem — inconsistent categorization and reporting, making it difficult to identify and mitigate this type of fraud.

To respond to this challenge, the Federal Reserve convened a cross-industry focus group of 12 fraud experts (Off-site) in the fall of 2020 to develop a recommended definition of synthetic identity fraud.

A shared understanding of what constitutes synthetic identity fraud is expected to improve its detection, measurement and mitigation in the payments industry. Consistent use of this definition within and across organizations can enable us to discuss, identify and classify synthetic identity fraud in a similar manner.
Jim Cunha Senior Vice President
Federal Reserve Bank of Boston

This spring, the focus group concluded their work with the recommendation that the following definition be used by the payments industry as it relates to synthetic identity fraud:

Synthetic identity fraud (SIF) is the use of a combination of personally identifiable information (PII) (Off-site) to fabricate a person or entity in order to commit a dishonest act for personal or financial gain.

To supplement the definition and further educate the industry, the group also outlined identity elements that may be used to create a synthetic identity, common uses of synthetics and the potential applications of the definition. Learn more (Off-site) about the focus group’s efforts and the development of this definition.

Fed360

Mark your calendar: Internal application testing for the FedACH® system on Saturday, May 15

The Federal Reserve Banks will be conducting internal application testing for the FedACH system on Saturday, May 15. Please do not attempt to send any files or use the derived returns feature in FedLine® Information Services.

Files sent during this time will not be processed. If files are sent, they will remain in an unprocessed state and will have to be resent upon completion of the test. FedACH will resume normal business processing on Sunday, May 16 at 5:30 p.m. ET.

Please direct any questions or concerns to FedACH® and Check Services Customer Support.

Fed360

Compare the services available on FedLine® Solutions

The Ops Stop provides your organization with a one-stop shop full of helpful operational resources offered by the Federal Reserve Banks. For this installment of the series, we are featuring the FedLine Solutions Services Comparison Matrix, which provides information on the services that are available through the FedLine Solutions.

Has your organization ever wondered which payment and information services are available through each of the FedLine Solutions? If so, you may want to check out the 2021 FedLine Solutions Services Comparison Matrix (PDF). The matrix is updated on a regular basis and is a great resource for determining which FedLine Solutions are best for your organization. The matrix includes:

  • An extensive view of all the services that are included via the different FedLine Solutions, some of which are opt-in services
  • A la carte options that can provide your organization with additional flexibility in your current solution, or identify when it makes sense to move to a different package

Additionally, if your organization is considering a move from FedMail® to the FedLine Web® Solution or is interested in exploring package options within the FedLine Advantage® Solution, the following matrices may also be helpful:

All FedLine Solutions are designed to provide the options and flexibility you need to manage your payments business regardless of the size of your organization. If you have any questions or are interested in learning more, please contact your Federal Reserve account executive.