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ACH Fraud Monitoring – Are You Ready For It?

September 25, 2025
Joann Lang, CIA, CAMS, CCBP

ACH Fraud Monitoring – Are You Ready For It?

Growth in electronic banking facilitated by ACH transactions continues to surge as consumers and businesses want – and expect – faster payment options from their financial institutions.  Historically electronic payment methods have seen less fraud than their paper (check) counterpart.  But with the increase in ACH payment volumes, there is also an increase in fraud and the need for stronger fraud prevention measures.

In an effort to help combat the rise in fraud and protect all participants in the ACH network, Nacha is implementing new rules in 2026 aimed at fraud monitoring and improving the recovery of funds after fraud has occurred.  These rules impact both the creation and receipt of ACH entries, and prompt financial institutions to establish and implement risk-based processes and procedures.

  • March 20, 2026 (Fraud Monitoring – Phase 1)
    • Fraud Monitoring by all Originating Depository Financial Institutions (ODFIs) and non-consumer originators, Third Party Service Providers (TPSPs), and Third Party Senders (TPSs) with annual ACH origination volumes of 6 million entries or greater in 2023
    • ACH Credit Monitoring for Receiving Depository Financial Institutions (RDFIs) with annual ACH receipt volume of 10 million or greater in 2023
  • March 20, 2026 (Company Entry Descriptions)
    • Prearranged Payments and Deposit (PPD) credits for payment of wages, salaries, etc. must contain the description PAYROLL in the company entry description field.
    • E-commerce purchases must contain the description PURCHASE in the company entry description field
  • June 19, 2026 (Fraud Monitoring – Phase 2)
    • For all other ODFIs and non-consumer originators, TPSPs, and TPSs that did not fall under the volume threshold of 6 million entries referenced in Phase 1
    • For all other RDFIs that did not fall under the volume threshold of 10 million entries in Phase 1

These dates will be here before you know it, and since fraudsters like to conduct their nefarious activities on any given day (and during any hour of any day), having a strong ACH risk management program that complies with Nacha requirements and industry guidelines is paramount to stopping as much fraud as is possible.  Start planning now to ensure your institution is ready for these new rules.  And don’t forget that very important existing rule that requires all ACH network participants to have an annual rules audit completed by December 31st of each year.  If you haven’t scheduled that audit yet, reach out to us to assist in getting that marked off your list for 2025.  We’re here to help you ensure your ACH program is compliant and ready to meet the challenges for 2026.

 

To read more about the new Nacha rules, visit the following link: https://www.nacha.org/newrules