Will Your Direct Deposit Leave The Us International Ach

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Will your direct deposit leave the U.S.? (International ACH)
Will your direct deposit leave the U.S.?
The Electronic Payments Association (NACHA) requires all direct deposit payments that are
sent outside the U.S. to be identified and sent as International ACH Transactions (IATs). If the
entire amount of your direct deposit is ultimately deposited to a financial institution outside the
U.S. Please complete the form below and/or contact the Payroll Office (518) 276-6926 or
Accounts Payable Office (518) 276-6923.
Frequently Asked Questions
What is an IAT transaction? An IAT (International ACH Transaction) is an ACH (direct
deposit) debit or credit entry that is part of a payment transaction originating from or transmitted
to an office of a financial agency located outside the territorial jurisdiction of the United States.
Corporate business and consumer accounts may receive IAT entries. For example, you may
have payment instructions with your bank to move the entire amount of the direct deposit
received from Rensselaer Polytechnic Institute to a foreign financial institution.
Why the change in regulations? Under US Law, banks are required to screen all ACH
payments to ascertain if the funds associated with a payment are being remitted to (or being
received from) any party subject to the Office of Foreign Assets Control (OFAC
) sanctions. OFAC administers and enforces
economic and trade sanctions based on US foreign policy and national security goals against
targeted foreign countries and regimes, terrorists, international narcotics traffickers, those
engaged in activities related to the proliferation of weapons of mass destruction, and other threats
to national security, foreign policy or the economy of the United States. OFAC has authority to
impose controls on transactions and freeze assets under US jurisdiction. The IAT rules are
intended to assist the banking industry in performing this screening process.
Does the regulation apply to checks or wire payments as well? No. The regulations only
apply to ACH transactions. There are already OFAC regulatory screening requirements within
the domestic wire transfer networks.
If I am only going to be transferring a portion of my payment do I have to consider my
payment an IAT transaction? No. To be considered an IAT transaction the entire amount of
the payment would need to be transferred to a location outside of the United States.
Why aren’t the banks collecting this information? Banks that transmit funds outside the U.S.
already do report to the Federal Office of Foreign Assets Control (OFAC) for security purposes.
The new rule is an attempt by OFAC to determine the source of these funds when originally
transmitted within the U.S. using the NACHA network. That is why ACH originators (like

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