Argos Risk Introduces an Industry Solution Risks Related to ACH Transactions

« Back to previous page

Posted October 25, 2013 in by Argos Risk 

The Automated Clearing House (ACH) Network is considered to be one of the safest payment systems in the world. Although the ACH system itself is secure for the electronic transfer of funds, the transaction process is inherently risky due to the multiple entities involved. Regulations require that Originating Depository Financial Institutions (ODFIs) that initiate transactions on behalf of Third-Party Senders have an agreement directly with their Third-Party Senders. However, ODFIs are not required to establish agreements with the Third-Party Sender’s originating customers even though the ODFI is ultimately responsible for all transactions initiated on their behalf. ODFIs are at risk because they do not have direct access to critical information about these originating customers and are bound by regulatory requirements to understand and monitor the actions of these entities. 

Argos Risk, a leading provider of SaaS technology solutions that enable companies to proactively manage credit risk and protect against business identity fraud, recognized a tremendous need for a solution to manage Third-Party Sender Risk. Expanding on its flagship product, Argos Risk Online, the company created the industry’s first turnkey software solution designed specifically for Third-Party Sender ACH risk management. 

Lori Frank, President of Argos Risk, explains how Argos Risk Online works: “Our technology allows ODFIs to enter basic information on their Third-Party Senders and their originating customers such as the company’s name, website address, and mailing address. Argos Risk Online has access to multiple data sources that generate analytical insight on the originating companies. Our sophisticated systems leverage tremendous of amounts of data and employ algorithms and patent pending analytics to make it possible for ODFIs to quickly and easily view specific information on Third-Party Senders and their originating customers.” 

In addition, Argos Risk Online allows ODFIs to set specific risk tolerance levels and create measurable analytics for each business entity in order to more closely monitor its origination activities. Finally, this technology solution allows ODFIs to generate reports on any Third-Party Sender or any of their originating customers at any given time.

For an in-depth look at Third-Party Sender risk check out Argos Risk’s latest white paper, “Don’t Originate in the Dark: Shine Some Light on Your Third-Party Senders and Their Originators” written by Steve Foster, Founder and Chairman. 
The Argos Risk executive management team is actively involved in providing education and information industry-wide on ACH Risk Management. On October 29, Brent Siegel, Vice President, will be presenting at the 2013 EPCOR Payments Conference in Overland Park, KS, on the topic of ACH Regulatory and Compliance Issues. Siegel, along with a panel of experts, will explore best practices and solutions.