Oral WSUD - What Should You Do?

Amy Donaghue

By: Raven Smith, AAP, NCP, Manager, Member Support

Member Support has received several questions regarding oral acceptance of Written Statements of Unauthorized Debits (WSUDs). Understandably, there seems to be some confusion on this topic. We applaud our members for being proactive in understanding their ACH Rules requirements in accepting WSUDs.

On September 17, 2021, the ACH Rules were amended to explicitly allow RDFIs to accept WSUDs electronically or verbally in addition to the (now) old-school pen-to-paper approach. However, Subsection 3.12.4 Form of Written Statement of Unauthorized Debit states “The Written Statement of Unauthorized Debit must be signed or similarly authenticated by the Receiver.” This is where the confusion begins.

Signed means pen to paper. But what exactly does “similarly authenticated” mean?

The standards for similar authentication allow for signatures to be provided electronically in accordance with the Electronic Signatures in Global and National Commerce Act (also known as the E-Sign Act), as stated in Subsection 1.4.4 Electronic Signatures. Authentication is the process of verifying the identity of an individual, and it is a critical factor in ensuring electronic signatures are genuine. A phone call would qualify as an electronic signature under the E-Sign Act, meaning RDFIs may obtain a Written Statement of Unauthorized Debit orally by authenticating the account holder over the phone. Online banking also utilizes authentication, therefore RDFIs may choose to obtain an electronic signature by allowing account holders to log into their online banking to complete WSUDs. And of course, there are tools such as DocuSign that can be used to collect electronic signatures.

But you may be wondering – what is the process an RDFI should use when accepting WSUDs orally? RDFIs should document the employee who authenticated the account holder and the authentication method used. There are several ways to authenticate over the phone, including codes, PINs and verification of personally identifiable information. The signature line of a WSUD obtained verbally may read, “[Bank Employee Name], [verified Account Holder Name] via [authentication method].”

RDFIs accepting oral WSUDs are advised to develop written procedures to ensure account holders are properly authenticated and their compliance with the requirements of Subsection 3.12.4 Form of Written Statement of Unauthorized Debit. Procedures should include a script of questions to ask account holders, including an assertation statement that asserts details of the WSUD are true and correct and the Receiver is an authorized signer on the account.

It's as simple as that! You have your completed Written Statement of Unauthorized Debit, can return those disputed entries and recredit your account holder. And it was all done without having your account holder come into the branch. Talk about A+ customer/member service!

We’ll be answering more member-asked questions during our upcoming Ask Hoot-E Live! webinar, happening October 12. Register today and submit your questions!