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EPN
Core
Overview
Risk Control
System Performance
 
 

Risk Management

Operational Risk

Click here to read about critical changes in ACH and fraud prevention measures.

EPN protects against the risk of disruption of processing and settlement with:

  • Redundant processing
  • Hot backup (15 – 30 minute recovery)
  • Operator owned contingency site
  • Reconfigurable communications network
  • Approved business resumption plan
  • SAS 70 audit conducted by KPMG
  • Extensive software quality control
  • Federal Financial Institution Council (FFIEC) Examination
   

Credit Risk

Click here for more information on
Credit & Debit Origination Controls

EPN minimizes the financial risk to its member financial institutions with:

  • Credit origination controls
  • Debit and credit transaction finality through end-of-day settlement with the Federal Reserve - Quarterly credit evaluations of its members
  • Monitor Fitch Bank Rating Service ratings in real time
  • Monitoring net debit position
  • Controls on respondents
   

Fraud Risk

Banks are observing a trend of increasing fraudulent activity in the ACH network. This is due, in part, to new payment applications within the ACH – over the Internet, over the telephone and at the point-of-sale.

EPN safeguards processing and settlement with:

 

    External Fraud Control
    Since 1986 all transactions originated into EPN are protected from fraud and error by an encryption or authentication process. The system identifies the message originator and verifies that the information received has not been altered intentionally or accidentally.  

    All files transmitted between EPN, its customers, and FedACH are encrypted and authenticated.

 

    Internal Fraud Controls
    The system is protected from internal fraud through the use of several techniques:

 
    • No application source code or compilers present on the production computer.
    • Application programmers have limited access to the production system.
    • Clearly defined separations of duties between computer operations, systems development, technical services and data security.
 

    Internet Security Measures
    On the Internet, the data is kept private with SSL encryption. Access is controlled by a PIN and RSA token. Further security is achieved for both methods with the use of user codes and password sign-ons in the application.

   

EPN Risk Management Group

Bank senior executives regularly review processes to ensure that EPN employs rigorous safeguards and standards to defend against other risks associated with legal, liquidity, systemic, and settlement finality issues.

Risk Management Education

To minimize ACH fraud risk exposure banks need to understand the issues and examine and implement risk management procedures and programs.

EPN offers several seminars and classes on managing ACH risk.

Click here for the course list, schedule and registration.