U.S. patent application number 11/983034 was filed with the patent office on 2008-07-03 for automated return item re-clear.
This patent application is currently assigned to Federal Reserve Bank of Richmond. Invention is credited to Benjamin T. Breeden.
Application Number | 20080162322 11/983034 |
Document ID | / |
Family ID | 39584122 |
Filed Date | 2008-07-03 |
United States Patent
Application |
20080162322 |
Kind Code |
A1 |
Breeden; Benjamin T. |
July 3, 2008 |
Automated return item re-clear
Abstract
Automatically, electronically re-clearing returned checks for
payment and presentment. A check processing entity includes a check
processing system. A re-clear module of the check processing system
receives electronic information regarding a check returned by a
receiving institution. The re-clear module automatically determines
whether the check is eligible for re-clearing, i.e., whether the
check is eligible for reprocessing for payment and/or presentment.
For example, the re-clear module can determine whether the check is
eligible based on: (a) whether a depositing institution associated
with the check has subscribed to a re-clearing service of the
processing entity, (b) whether a value of the check is less than a
threshold amount, (c) whether the check has been previously
re-cleared, and/or (d) whether a reason why the receiving
institution returned the check renders re-clearing undesirable. The
check processing system can re-clear each returned check determined
to be eligible for re-clearing.
Inventors: |
Breeden; Benjamin T.;
(Eldersburg, MD) |
Correspondence
Address: |
KING & SPALDING LLP
1180 PEACHTREE STREET
ATLANTA
GA
30309-3521
US
|
Assignee: |
Federal Reserve Bank of
Richmond
Richmond
VA
|
Family ID: |
39584122 |
Appl. No.: |
11/983034 |
Filed: |
November 6, 2007 |
Related U.S. Patent Documents
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Application
Number |
Filing Date |
Patent Number |
|
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60857666 |
Nov 7, 2006 |
|
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Current U.S.
Class: |
705/35 |
Current CPC
Class: |
G06Q 20/04 20130101;
G06Q 20/108 20130101; G06Q 20/042 20130101; G06Q 40/00 20130101;
G06Q 20/0425 20130101 |
Class at
Publication: |
705/35 |
International
Class: |
G06Q 40/00 20060101
G06Q040/00 |
Claims
1. A computer-implemented method for automatically resubmitting a
returned check for payment, comprising the steps of: receiving at a
check processing system of a check processing entity electronic
information regarding a check returned by a receiving institution;
automatically determining, by the check processing system, whether
the check is eligible to be reprocessed for at least one of payment
and presentment; and reprocessing the check for at least one of
payment and presentment in response to determining that the check
is eligible to be reprocessed.
2. The method of claim 1, wherein the step of automatically
determining whether the check is eligible to be reprocessed
comprises the steps of: determining whether a depositing
institution associated with the check has subscribed to a service
of the check processing entity; and determining that the check is
not eligible to be reprocessed in response to determining that the
depositing institution has not subscribed to the service of the
check processing entity.
3. The method of claim 1, wherein the step of automatically
determining whether the check is eligible to be reprocessed
comprises the steps of: determining whether a value of the check is
less than a threshold value; and determining that the check is
eligible to be reprocessed in response to determining that the
value of the check is less than the threshold value.
4. The method of claim 1, wherein the step of automatically
determining whether the check is eligible to be reprocessed
comprises the steps of: determining whether the check has
previously been reprocessed for at least one of payment and
presentment; and determining that the check is eligible to be
reprocessed in response to determining that the check has not been
previously reprocessed for at least one of payment and
presentment.
5. The method of claim 1, wherein the step of automatically
determining whether the check is eligible to be reprocessed
comprises the steps of: determining whether the check has
previously been reprocessed for at least one of payment and
presentment more than a predetermined number of times; and
determining that the check is eligible to be reprocessed in
response to determining that the check has not been previously
reprocessed for at least one of payment and presentment more than
the predetermined number of times.
6. The method of claim 1, wherein the step of automatically
determining whether the check is eligible to be reprocessed
comprises the steps of: identifying a reason why the check was
returned by the receiving institution based on the electronic
information regarding the check; determining whether the identified
reason renders reprocessing of the check undesirable; and
determining that the check is eligible to be reprocessed in
response to determining that the identified reason does not render
reprocessing of the check undesirable.
7. The method of claim 1, further comprising the step of notifying
a depositing institution associated with the check that the check
is not eligible for reprocessing in response to determining that
the check is not eligible to be reprocessed for payment.
8. The method of claim 1, further comprising the step of
transmitting the check to a depositing institution associated with
the check in response to determining that the check is not eligible
to be reprocessed.
9. The method of claim 1, wherein the step of reprocessing the
check comprises the steps of: creating an ICL file comprising
information regarding the check; and transmitting the ICL file to
the receiving institution.
10. The system of claim 1, wherein the receiving institution is a
third party agent that provides a processing service to a bank
associated with the check.
11. A computer-implemented method for automatically determining
whether to re-clear a returned check, comprising the steps of:
receiving at a check processing system of a check processing entity
electronic information regarding a check returned by a receiving
institution; automatically determining, by the check processing
system, whether the check is eligible to be reprocessed for at
least one of payment and presentment based on a reason why the
check was returned by the receiving institution; and determining to
reprocess the check for at least one of payment and presentment in
response to determining that the check is eligible to be
reprocessed.
12. The method of claim 11, wherein the step of automatically
determining whether the check is eligible to be reprocessed
comprises the steps of: identifying the reason why the check was
returned by the receiving institution; determining whether the
identified reason renders reprocessing of the check undesirable;
and determining that the check is eligible to be reprocessed in
response to determining that the identified reason does not render
reprocessing of the check undesirable.
13. The method of claim 11, further comprising the step of
notifying a depositing institution associated with the check that
the check is not eligible for reprocessing in response to
determining that the check is not eligible to be reprocessed.
14. The method of claim 11, further comprising the step of
transmitting the check to a depositing institution associated with
the check in response to determining that the check is not eligible
to be reprocessed.
15. The method of claim 11, wherein the step of reprocessing the
check comprises the steps of: creating an ICL file comprising
information regarding the check; and transmitting the ICL file to
the receiving institution.
16. The system of claim 11, wherein the receiving institution is a
third party agent that provides a processing service to a bank
associated with the check.
17. A computer-implemented method for automatically reprocessing a
returned check, comprising the steps of: receiving at a check
processing system of a check processing entity electronic
information regarding a check returned by a receiving institution;
automatically determining, by the check processing system, whether
the check is eligible to be reprocessed for at least one of payment
and presentment based on at least one of: (a) whether a depositing
institution associated with the check has subscribed to a
re-clearing service of the check processing entity, (b) whether a
value of the check is less than a threshold value, (c) whether the
check has been previously reprocessed for at least one of payment
and presentment, and (d) a reason why the receiving institution
returned the check; and reprocessing the check for at least one of
payment and presentment in response to determining that the check
is eligible to be reprocessed.
18. The method of claim 17, further comprising the step of
notifying the depositing institution associated with the check that
the check is not eligible for reprocessing in response to
determining that the check is not eligible to be reprocessed.
19. The method of claim 17, further comprising the step of
transmitting the check to the depositing institution associated
with the check in response to determining that the check is not
eligible to be reprocessed.
20. The method of claim 17, wherein the step of reprocessing the
check comprises the steps of: creating an ICL file comprising
information regarding the check; and transmitting the ICL file to
the receiving institution.
21. The system of claim 17, wherein the receiving institution is a
third party agent that provides a processing service to a bank
associated with the check.
22. A computer-implemented system for automatically re-clearing an
item, comprising: a check processing module configured to process
checks for payment and presentment to a receiving institution; and
a re-clear module configured to automatically determine whether a
check returned by the receiving institution is eligible for
reprocessing based on at least one of: (a) whether a value of the
check is less than a threshold value, (b) whether the returned
check has been previously reprocessed for at least one of payment
and presentment, and (c) a reason why the receiving institution
returned the check, wherein the check processing module is further
configured to reprocess the check for at least one of payment and
presentment in response to the re-clear module determining that the
check is eligible for reprocessing.
23. The system of claim 22, wherein the re-clear module is further
configured to notify a depositing institution associated with the
check that the check is not eligible for reprocessing in response
to determining that the check is not eligible for reprocessing.
24. The system of claim 22, wherein the check processing module is
further configured to reprocess the check by creating an ICL file
comprising information regarding the check and transmitting the ICL
file to the receiving institution.
25. The system of claim 22, wherein the receiving institution is a
third party agent that provides a processing service to a bank
associated with the check.
Description
RELATED PATENT APPLICATION
[0001] This patent application claims priority under 35 U.S.C.
.sctn.119 to U.S. Provisional Patent Application No. 60/857,666,
entitled "Check Processing Using Substitute Check Images," filed
Nov. 7, 2006, the complete disclosure of which is hereby fully
incorporated herein by reference. This patent application also is
related to co-pending U.S. patent application Ser. No. ______
[Attorney Docket No. 08898.105034], entitled "Systems and Methods
for Preventing Duplicative Check Processing," filed Nov. 6, 2007,
U.S. patent application Ser. No. ______ [Attorney Docket No.
08898.105030], entitled "Prioritizing Checks for Electronic Check
Processing," filed Nov. 6, 2007, U.S. patent application Ser. No.
______ [Attorney Docket No. 08898.105032], entitled "System and
Method for Processing Duplicative Electronic Check Return Files,"
filed Nov. 6, 2007, and U.S. patent application Ser. No. ______
[Attorney Docket No. 08898.105033], entitled "System and Method for
Processing Duplicative Electronic Check Reversal Files," filed Nov.
6, 2007. The complete disclosure of all of the foregoing related
applications is hereby fully incorporated herein by reference.
TECHNICAL FIELD
[0002] The invention relates generally to re-clearing checks for
check processing and more particularly to automatically,
electronically re-clearing returned checks for payment and
presentment.
BACKGROUND
[0003] Effective Oct. 28, 2004, the Check Clearing for the 21st
Century Act ("the Act") improves the ability of banks to use
electronic images of paper checks by, for example, submitting those
images, along with associated information, for electronic
processing. Under the Act, if a receiving financial institution
("RI") or its customer requires a paper check, a paper image
replacement document ("IRD"), such as a paper "substitute check,"
can be created from an electronic check image and associated
electronic information. Such a substitute check meeting specified
requirements is the legal equivalent of an original paper check,
and an RI is required to accept the substitute check for payment.
This process enables banks to reduce the costs and inconveniences
associated with physically handling and transporting original paper
checks.
[0004] Under the Act, the substitute check must be essentially an
exact copy of the original paper check to be the legal equivalent
of the original paper check. In particular, the substitute check
must include an exact copy of all of the Magnetic Ink Character
Recognition ("MICR") data provided on the original paper check and
all check endorsements.
[0005] The terms "check," "substitute check" and "IRD" generally
are used interchangeably herein to refer to any electronic or paper
document that can be used for electronic payment processing
purposes, whether or not the document is the legal equivalent of a
paper check negotiable instrument. The terms "bank," "customer,"
"RI," and "processing entity" generally are used herein to refer to
any party performing conventional or electronic check processing at
any stage, including depositing and receiving institutions, their
non-bank subsidiaries and affiliates, and any non-bank third party
agents that provide processing services to banks.
[0006] Typically, a processing entity receives an electronic check
for processing in an electronic image cash letter file (hereinafter
an "ICL file"), which includes one or more electronic image cash
letters ("ICLs"). Each ICL includes one or more electronic bundles
of items to be processed. Each bundle includes data for one or more
items. The term "item" is used herein to refer to a check or an IRD
or information that represents a check or an IRD. For a particular
item, the ICL can include one or more electronic images of the
item, the complete MICR data provided on the item, and additional
financial data related to the item, such as endorsement information
(hereinafter "addenda data").
[0007] The ICL can further include a series of records related to
the items. For example, for each bundle of items in the ICL, the
ICL can include a bundle summary control record comprising
information about the bundle, such as a bundle identification
number, the number of items in the bundle, the value of each of the
items in the bundle, and the total value of all the items in the
bundle. The ICL also can include an ICL control record comprising
information about the origin and destination of the ICL, and a cash
letter bundle summary control record comprising a summary of all
the bundle summary control records in the ICL.
[0008] In electronic check processing, each item in the ICL is
processed for payment and presentment. The check processor can
process the items for electronic or paper presentment. For example,
the check processor can generate and transmit an ICL with
information regarding one or more of the items for electronic
presentment to an RI. Similarly, the check processor can print a
paper cash letter with information regarding one or more of the
items for paper presentment to the RI.
[0009] After receiving a paper or electronic cash letter for
payment, the RI ultimately may determine that one or more of the
items in the cash letter cannot be processed. For example, a bank
account associated with an item may be closed or may have
insufficient funds, a routing number associated with an item may be
invalid, and/or a "stop payment" order may be associated with the
item. A person of ordinary skill in the art will recognize that
many other suitable reasons may exist for not processing an item
for payment. If the RI determines not to process an item for
payment, the RI places the item, now called a "return item," in a
"return cash letter" and transmits the return cash letter to the
processing entity for return of the item to the original depositing
financial institution.
[0010] The return cash letter includes one or more return items and
can be an ICL or a paper cash letter. Traditionally, an operator at
the processing entity prints all return ICLs so that all return
items are processed via paper. The operator reviews all paper
return items by hand to determine whether each return item can be
reprocessed for payment and/or presentment. If the return item can
be reprocessed, then the processing entity captures electronic data
and images from the return item for electronic processing and
resubmission to the RI for payment. If the return item cannot be
reprocessed, then the processing entity rejects the return item and
transmits the return item and/or electronic data and/or images of
the item to the depositing institution for handling. This process
involves many inefficiencies, most notably the delay involved in
manually reviewing each return item by hand.
[0011] Thus, a need exists in the art for a system and method for
efficiently re-clearing returned checks for payment and
presentment.
SUMMARY
[0012] The invention provides systems and methods for automatically
re-clearing, i.e., reprocessing for presentment and/or payment, a
check returned by a receiving institution. A check processing
entity includes a check processing system. A re-clear module of the
check processing system receives electronic information regarding a
check returned by a receiving institution. The receiving
institution may return the check for many different reasons. For
example, the receiving institution may return the check if a bank
account associated with the check is closed or has insufficient
funds, a routing number associated with the check is invalid,
and/or a "stop payment" order is associated with the check.
[0013] The re-clear module automatically determines whether the
check is eligible for re-clearing. In other words, the re-clear
module determines whether the check is eligible for reprocessing
for payment and/or presentment. In certain exemplary embodiments,
the re-clear module can determine whether the check is eligible for
reprocessing based on: (a) whether a depositing institution
associated with the check has subscribed to a re-clearing service
of the processing entity, (b) whether a value of the check is less
than a threshold amount, (c) whether the check has previously been
re-cleared, and/or (d) whether a reason why the check was returned
by the receiving institution renders re-clearing undesirable. For
example, it may be undesirable to re-clear a check returned because
the bank account associated with the check was closed, but it may
be desirable to re-clear a check that was returned because the bank
account associated with the check had insufficient funds at the
time the item first was processed.
[0014] The check processing system can re-clear each returned check
determined to be eligible for re-clearing. For example, a check
processing module of the check processing system can generate an
ICL including information regarding the returned check. Then, the
check processing module can transmit the generated ICL to the
receiving institution.
[0015] The check processing system can determine not to re-clear
each returned check determined not to be eligible for re-clearing.
In certain exemplary embodiments, the processing entity can
transmit the returned check to the depositing institution via an
ICL or a paper cash letter to complete the return cycle. In
addition, or in the alternative, the re-clear module can output a
notification to the depositing institution and/or an operator of
the processing entity, notifying the depositing institution and/or
operator that the returned check is not eligible to be re-cleared.
For example, the notification can include information identifying
the check, the depositing institution, and/or the receiving
institution, a value of the check, and/or information regarding a
reason why the check is not eligible to be re-cleared. In certain
exemplary embodiments, the depositing institution and/or operator
can override the decision of the re-clear module not to re-clear
the check.
[0016] These and other aspects, objects, features, and advantages
of the invention will become apparent to a person skilled in the
art upon consideration of the following detailed description of
illustrated exemplary embodiments, which include the best mode of
carrying out the invention as presently perceived.
BRIEF DESCRIPTION OF THE DRAWINGS
[0017] FIG. 1 is a block diagram depicting a system for
automatically re-clearing a return item, according to certain
exemplary embodiments of the invention.
[0018] FIG. 2 is a flow chart depicting a method for automatically
re-clearing a return item, according to certain exemplary
embodiments of the invention.
[0019] FIG. 3 is a flow chart depicting a method for determining
whether a return item is eligible for re-clearing, according to
certain exemplary embodiments of the invention.
DETAILED DESCRIPTION OF EXEMPLARY EMBODIMENTS
[0020] The invention is directed to efficiently re-clearing checks
for check processing. In particular, the invention is directed to
automatically, electronically re-clearing returned checks for
payment and presentment.
[0021] The invention includes a computer program that embodies the
functions described herein and illustrated in the appended flow
charts. However, it should be apparent that there could be many
different ways of implementing the invention in computer
programming, and the invention should not be construed as limited
to any one set of computer program instructions. Further, a skilled
programmer would be able to write such a computer program to
implement an embodiment of the disclosed invention based on the
flow charts and associated description in the application text.
Therefore, disclosure of a particular set of program code
instructions is not considered necessary for an adequate
understanding of how to make and use the invention. The inventive
functionality of the claimed computer program will be explained in
more detail in the following description read in conjunction with
the figures illustrating the program flow.
[0022] Turning now to the drawings, in which like numerals indicate
like elements throughout the figures, exemplary embodiments of the
invention are described in detail.
[0023] FIG. 1 is a block diagram depicting a system 100 for
automatically re-clearing a return item, in accordance with certain
exemplary embodiments of the invention. The system 100 is described
hereinafter with reference to the methods illustrated in FIGS. 2
and 3.
[0024] FIG. 2 is a flow chart depicting a method 200 for
automatically re-clearing a return item, in accordance with certain
exemplary embodiments of the invention. The exemplary method 200 is
illustrative and, in alternative embodiments of the invention,
certain steps can be performed in a different order, in parallel
with one another, or omitted entirely, and/or certain additional
steps can be performed without departing from the scope and spirit
of the invention. The method 200 is described hereinafter with
reference to FIGS. 1 and 2.
[0025] A check processing entity 105 includes a check processing
system 103. The check processing system 103 processes paper checks
and electronic items for payment and/or presentment. The check
processing system 103 receives electronic items from depositing
institutions 102 in one or more ICL files including one or more
ICLs. For example, the depositing institutions 102 can submit the
ICLs file to the check processing system 103 via a network 104.
[0026] The network 104 can include any wired or wireless
telecommunication means by which computerized devices can exchange
data, including for example, a local area network (LAN), a wide
area network (WAN), an intranet, an Internet, or any combination
thereof. In certain exemplary embodiments, the processing entity
105 can include a Federal Reserve Bank or other check processor
that receives transaction items from a depositing institution 102,
distributes the items to appropriate receiving institutions 115 or
their third party processor(s), and performs settlement functions
(crediting and debiting of accounts) for the affected financial
institutions.
[0027] For example, each ICL can be an electronic file that
complies with the ANSI X9.37/X9.100 standard, or other appropriate
industry standards, as may change from time to time. Each ICL
includes one or more bundles of items (checks and/or IRDs) to be
processed. For a particular item, the ICL can include one or more
electronic images of the item, all of the complete MICR data
provided on the item, and addenda data of the item.
[0028] The ICL also can include a series of records related to the
items. For example, for each bundle of items in the ICL, the ICL
can include a bundle summary control record including information
about the bundle, such as a bundle identification number, the
number of items in the bundle, the value of each of the items in
the bundle, and the total value of all the items in the bundle. The
ICL also can include an ICL control record containing information
about the origin and destination of the ICL, and a cash letter
bundle summary control record containing a summary of all the
bundle summary control records in the ICL. The term "record" is
used herein to refer to a set of electronic data, including,
without limitation, a table, a file, and a part of a table or
file.
[0029] In certain embodiments of the invention, the ICL file also
can include a file header including information identifying the
depositing institution 102, such as a name of the depositing
institution 102 and/or a bank routing number of the depositing
institution 102. The file header also can include information
regarding a creation date of the ICL file and information regarding
whether each ICL and/or item in the ICL file is associated with a
forward transaction or a return transaction.
[0030] The check processing system 103 also receives information
regarding paper checks transmitted to the check processing entity
105 by the depositing institutions 102 in one or more paper cash
letters. Each paper cash letter includes one or more paper checks.
For example, the depositing institution 102 can send a paper cash
letter to the processing entity 105 via hand or mail delivery. Upon
receipt of the paper cash letter at the processing entity 105, a
MICR/image capturing device 106 of the processing entity 105 can
electronically capture MICR data from each check and images of the
front and/or back sides of each check. The MICR/image capturing
device 106 can include a separate or integrated MICR reader and
image capturing device. The MICR/image capturing device 106 can
forward the captured electronic data and images to the check
processing module 108 for processing.
[0031] The check processing module 108 processes each check for
payment and presentment. The check processing module 108 can
process the items for electronic or paper presentment. For example,
the check processing module 108 can generate and transmit an ICL
with information regarding one or more of the items for electronic
presentment to a receiving institution 115. Similarly, the check
processor can print a paper cash letter with information regarding
one or more of the items for paper presentment to the receiving
institution 115. Certain exemplary methods for performing such
processing are described in co-pending U.S. patent application Ser.
No. 11/362,344, entitled "Cash Letter Print Streams With Audit
Data" and U.S. patent application Ser. No. 11/362,343, entitled
"Expanded Mass Data Sets for Electronic Check Processing," the
complete disclosures of which are hereby fully incorporated herein
by reference.
[0032] After receiving a paper or electronic cash letter for
payment, the receiving institution 115 ultimately may determine
that one or more of the items in the cash letter cannot be
processed. For example, a bank account associated with an item may
be closed or may have insufficient funds, a routing number
associated with an item may be invalid, and/or a "stop payment"
order may be associated with the item. A person of ordinary skill
in the art will recognize that many other suitable reasons may
exist for not processing an item for payment. If the receiving
institution 115 determines not to process an item for payment, the
receiving institution 115 places the item, now called a "return
item," in a "return cash letter" and transmits the return cash
letter to the processing entity 105 for return of the item to the
depositing institution 102.
[0033] The return cash letter includes one or more return items.
The return cash letter can be an ICL or a paper cash letter. If the
return cash letter is a paper cash letter, then the MICR/image
capturing device 106 of the processing entity 105 can
electronically capture MICR data from each item and images of the
front and/or back sides of each item. The MICR/image capturing
device 106 can forward the captured electronic data and images to
the check processing module 108 for processing.
[0034] In certain exemplary embodiments, the receiving institution
115 can transmit a return ICL to the processing entity 105 via the
network 104. As with a "regular," forward ICL, a return ICL can be
an electronic file that complies with the ANSI X9.37/X9.100
standard, or other appropriate industry standards, as may change
from time to time. The return ICL includes one or more bundles of
return items (returned checks and/or returned IRDs) to be
processed. For a particular return item, the return ICL can include
one or more electronic images of the return item, all of the
complete MICR data provided on the return item, and addenda data of
the return item.
[0035] The return ICL also can include a series of records related
to the return items. For example, for each bundle of return items
in the return ICL, the return ICL can include a bundle summary
control record including information about the bundle, such as a
bundle identification number, the number of return items in the
bundle, the value of each of the return items in the bundle, and
the total value of all the return items in the bundle. The return
ICL also can include an ICL control record containing information
about the origin and destination of the return ICL, and a cash
letter bundle summary control record containing a summary of all
the bundle summary control records in the return ICL.
[0036] The check processing module 108 receives each return ICL in
an ICL file. The ICL file includes one or more ICLs. A particular
ICL file can include both forward ICLs and return ICLs. In certain
exemplary embodiments, the ICL file can include a file header
including information identifying the depositing institution 102,
such as a name of the depositing institution 102 and/or a bank
routing number of the depositing institution 102. The file header
also can include information regarding a creation date of the ICL
file and information regarding whether each ICL and/or item in the
ICL file is associated with a forward transaction or a return
transaction.
[0037] Referring to FIG. 2, in step 205, a re-clear module 107 of
the check processing system 103 receives information from the check
processing module 108 regarding a return item to be re-cleared. For
example, the check processing module 108 can transmit the
information based on information from a return paper cash letter or
a return ICL file transmitted to the processing entity 105 by a
receiving institution 115.
[0038] In step 210, the re-clear module 107 determines whether the
return item is eligible for re-clearing. For example, the re-clear
module 107 can determine that a return item is not eligible for
re-clearing if the depositing institution 102 has not subscribed to
a re-clearing service of the processing entity 105, if a value of
the return item is above a predetermined threshold amount, if the
return item already has previously been re-cleared, and/or if a
reason why the return item was returned by the receiving
institution 115 renders re-clearing undesirable. Similarly, the
re-clear module 107 can determine that a return item is eligible
for re-clearing if the depositing institution 102 has subscribed to
the re-clearing service of the processing entity 105, if the value
of the return item is less than or equal to a predetermined
threshold amount, if the return item has not previously been
re-cleared, and/or if a reason why the return item was returned by
the receiving institution 115 does not render re-clearing
undesirable. Step 210 is described in detail hereinafter with
reference to FIG. 3.
[0039] If the re-clear module 107 determines in step 210 that the
return item is eligible for re-clearing, then the method 200
branches to step 220. In step 220, the check processing module 108
converts the return item to a forward item and processes the
forward item for payment and presentment to the receiving
institution 115. The check processing module 108 can perform such
processing in substantially the same manner in which it processes
regular, non-return items. For example, the check processing module
108 can generate an ICL including information regarding the forward
item for transmission to the receiving institution 115. Certain
exemplary methods for performing such processing are described in
co-pending U.S. patent application Ser. No. 11/362,344, entitled
"Cash Letter Print Streams With Audit Data" and U.S. patent
application Ser. No. 11/362,343, entitled "Expanded Mass Data Sets
for Electronic Check Processing," the complete disclosures of which
are hereby fully incorporated herein by reference.
[0040] In certain exemplary embodiments, the re-clear module 107
can output a notification to the depositing institution 102 and/or
an operator of the processing entity 105, notifying the depositing
institution 102 and/or operator that the return item has been
converted to a forward item and/or that the item is eligible for
being re-cleared. For example, the notification can include
information identifying the item, the depositing institution 102
and/or the receiving institution 115, a value of the item, and/or
information regarding a reason why the item was returned.
[0041] In step 225, the re-clear module 107 stores information
regarding the item in a history record. For example, the history
record can be stored in a database 109 of the check processing
system 103. The history record can include information identifying
all items that previously have been determined to be eligible for
re-clearing and/or that already have been re-processed for payment
and/or presentment within a predetermined time period. For example,
for each item, the history record can include a unique identifier
assigned to the item substantially as described in co-pending U.S.
patent application Ser. No. ______ [Attorney Docket No.
08898.105034], entitled "Systems and Methods for Preventing
Duplicative Electronic Check Processing," filed on Nov. 6, 2007,
the complete disclosure of which is hereby fully incorporated
herein by reference.
[0042] In certain exemplary embodiments, the history record can be
stored in, or can otherwise be appended to, the item. In such
embodiments, the history record may not include information
identifying the item, but instead may include information
indicating that the item has been determined to be eligible for
re-clearing and/or that the item already has been re-processed for
payment and/or presentment. For example, the history record can
include addenda data of the item.
[0043] From step 225, the method 200 ends.
[0044] Referring back to step 210, if the re-clear module 107
determines that the return item is not eligible for re-clearing,
then the method 200 branches to step 215. In step 215, the re-clear
module 107 determines not to re-clear the return item. The
processing entity 105 transmits the return item to the depositing
institution 102 to complete the return cycle. The processing entity
105 can transmit the return item to the depositing institution 102
via an ICL or a paper cash letter. For example, the check
processing module 108 can transmit a return ICL including the
return item to the depositing institution 102 via the network 104.
Alternatively, the check processing module 108 can print a paper
cash letter including the return item for hand or mail delivery to
the depositing institution 102. Certain exemplary methods for
printing a paper cash letter are described in co-pending U.S.
patent application Ser. No. 11/362,344, entitled "Cash Letter Print
Streams With Audit Data," the complete disclosure of which is
hereby fully incorporated herein by reference.
[0045] From step 215, the method 200 ends.
[0046] In certain exemplary embodiments, the re-clear module 107
can output a notification to the depositing institution 102 and/or
an operator of the processing entity 105, notifying the depositing
institution 102 and/or operator that the return item is not
eligible for being re-cleared. For example, the notification can
include information identifying the return item, the depositing
institution 102 and/or the receiving institution 115, a value of
the return item, and/or information regarding a reason why the
return item is not eligible for being re-cleared. In certain
exemplary embodiments, the depositing institution 102 and/or
operator can override the decision of the re-clear module 107 not
to re-clear the item.
[0047] FIG. 3 is a flow chart depicting a method 210 for
determining whether a return item is eligible for re-clearing, in
accordance with certain exemplary embodiments of the invention, as
referenced in step 210 of the method 200 of FIG. 2. The exemplary
method 210 is illustrative and, in alternative embodiments of the
invention, certain steps can be performed in a different order, in
parallel with one another, or omitted entirely, and/or certain
additional steps can be performed without departing from the scope
and spirit of the invention. The method 210 is described
hereinafter with reference to FIGS. 1 and 3.
[0048] In step 305, the re-clear module 107 determines whether the
depositing institution 102 has subscribed to a re-clear service.
For example, in certain exemplary embodiments, the re-clear module
107 can limit re-clearing to items associated with depositing
institutions 102 that have agreed to pay a special fee for return
item re-clears. In certain exemplary embodiments, the re-clear
module 107 can access a list identifying all depositing
institutions 102 subscribed to a re-clear service to make the
determination of step 305. For example, such a list can be stored
in the database 109.
[0049] If the re-clear module 107 determines in step 305 that the
depositing institution 102 has not subscribed to a re-clear
service, then the method 210 branches to step 307. In step 307, the
re-clear module 107 determines that the return item is not eligible
for re-clearing. The method 210 then proceeds to step 215 of FIG.
2.
[0050] Referring back to step 305, if the re-clear module 107
determines that the depositing institution 102 has subscribed to a
re-clear service, then the method 210 branches to step 310. In step
310, the re-clear module 107 reads a value of the return item. For
example, the re-clear module 107 can read the value from a
financial data file or record associated with the item and/or from
a MICR line of the item.
[0051] In step 315, the re-clear module 107 determines whether the
read value is less than a predetermined threshold value. In certain
exemplary embodiments, the processing entity 105, the receiving
institution 115, and/or the depositing institution 102 can specify
the predetermined threshold value. For example, the depositing
institution 102 can specify that a return item is not eligible for
re-clearing unless the return item has a value less than $200. In
certain exemplary embodiments, the threshold value can be stored in
a file or record in the database 109.
[0052] If the re-clear module 107 determines in step 315 that the
value is not less than the predetermined threshold value, then the
method 210 branches to step 307. In step 307, the re-clear module
107 determines that the return item is not eligible for
re-clearing. The method 210 then proceeds to step 215 of FIG.
2.
[0053] Referring back to step 315, if the re-clear module 107
determines that the read value is less than the predetermined
threshold value, then the method 210 branches to step 320. In step
320, the re-clear module 107 compares information regarding the
return item to information in a history record. For example, the
history record can be stored in a database 109 of the check
processing system 103.
[0054] The history record can include information identifying all
items that already have been determined to be eligible for
re-clearing and/or that already have been re-processed for payment
and/or presentment within a predetermined time period. For example,
for each item, the history record can include a unique identifier
assigned to the item substantially as described in co-pending U.S.
patent application Ser. No. ______, [Attorney Docket No.
08898.105034], entitled "Systems and Methods for Preventing
Duplicative Electronic Check Processing," filed on Nov. 6, 2007,
the complete disclosure of which is hereby fully incorporated
herein by reference. The history record can include other
information regarding the item, such as a routing-transit number,
check sequence number, and/or dollar value associated with the
item.
[0055] In certain exemplary embodiments, the history record can be
stored in, or can otherwise be appended to, the item. In such
embodiments, the history record may not include information
identifying the item, but instead may include information
indicating that the item has been determined to be eligible for
re-clearing and/or that the item already has been re-processed for
payment and/or presentment. Regardless of whether the history
record is stored in or appended to the item, the history record can
include a time stamp for, or other information related to, each
time that the item was received and/or processed by the processing
entity 105. By way of example only, the history record can include
information regarding each time the processing entity 105 received
the item as a forward item and as a return item and/or information
regarding each time the processing entity 105 transmitted the item
to the receiving institution 115.
[0056] In step 325, the re-clear module 107 determines whether the
return item already has been re-cleared, based on the comparison
performed in step 320. If so, then the method 210 branches to step
307. In step 307, the re-clear module 107 determines that the
return item is not eligible for re-clearing. The method 210 then
proceeds to step 215 of FIG. 2.
[0057] Thus, in steps 320-325 and 307, the re-clear module 107
prevents the same return item from being re-cleared multiple times.
In certain alternative exemplary embodiments, the re-clear module
107 can allow the return item to be re-cleared multiple times, as
long as the total number of re-clears of a particular item does not
exceed a predetermined threshold. For example, the re-clear module
107 can read the history record to determine how many times each
return item has previously been re-cleared. The re-clear module 107
can compare that number of re-clears with the predetermined
threshold to determine whether re-clearing is appropriate. In
certain exemplary embodiments, the processing entity 105, the
receiving entity 115, and/or the depositing institution 102 can
specify the predetermined threshold number of re-clears. For
example, the threshold number can be stored in a file or record in
the database 109.
[0058] Referring back to step 325, if the re-clear module 107
determines that the return item has not already been re-cleared (or
has not been re-cleared more than the number of times specified by
the predetermined threshold), then the method 210 branches to step
330. In step 330, the re-clear module 107 identifies at least one
reason why the return item was rejected by the receiving entity
115. A person of ordinary skill in the art will recognize that a
receiving institution 115 may reject an item for many different
reasons. For example, a receiving institution 115 can reject an
item if a bank account associated with the item is closed or has
insufficient funds, a routing number associated with the item is
invalid, and/or a "stop payment" order is associated with the item.
In certain exemplary embodiments, the re-clear module 107 can
identify the reason(s) why the return item was rejected by reading
information in the return item and/or the paper cash letter, ICL,
and/or ICL file in which the receiving institution 115 transmitted
the return item to the processing entity 105. For example, the
return item can include an indicator indicating the reason(s).
[0059] In step 335, the re-clear module 107 determines whether the
reason(s) identified in step 330 render re-clearing undesirable.
For example, it may be undesirable to re-clear an item previously
rejected because a bank account associated with the item was
closed. However, it may be desirable to re-clear an item that
previously was rejected because the bank account associated with
the item had insufficient funds at the time the item first was
processed. In certain exemplary embodiments, the re-clear module
107 can make the determination of step 335 by comparing the
reason(s) identified in step 330 to a list of desirable and/or
undesirable reasons. For example, the list can be stored in a file
or record in the database 109. In certain exemplary embodiments,
the processing entity 105, the receiving entity 115, and/or the
depositing institution 102 can specify the desirable and/or
undesirable reasons.
[0060] If the re-clear module 107 determines in step 335 that the
identified reason(s) render re-clearing undesirable, then the
method 210 branches to step 307. In step 307, the re-clear module
107 determines that the return item is not eligible for
re-clearing. The method 210 then proceeds to step 215 of FIG.
2.
[0061] If the re-clear module 107 determines in step 335 that the
identified reason(s) do not render re-clearing undesirable, then
the method 210 branches to step 340. In step 340, the re-clear
module 107 determines that the return item is eligible for
re-clearing. The method 210 then proceeds to step 220 of FIG.
2.
[0062] A person of ordinary skill in the art having the benefit of
the present disclosure will recognize that the above-identified
factors for determining whether a return item is eligible for
re-clearing are merely exemplary in nature. In certain alternative
exemplary embodiments, other suitable factors may be used. In
addition, in certain alternative exemplary embodiments, no factors
may be used. Rather, all return items may be deemed suitable for
re-clearing in certain exemplary embodiments. Furthermore, all of
the factors illustrated in FIG. 3 may be used, at least one of the
factors illustrated in FIG. 3 may be used, or any combination of
the factors illustrated in FIG. 3 may be used.
[0063] The invention can be used with computer hardware and
software that performs the methods and processing functions
described above. As will be appreciated by a person skilled in the
art, the systems, methods, and procedures described herein can be
embodied in a programmable computer, computer executable software,
or digital circuitry. The software can be stored on computer
readable media. For example, computer readable media can include a
floppy disk, RAM, ROM, hard disk, removable media, flash memory,
memory stick, optical media, magneto-optical media, CD-ROM, etc.
Digital circuitry can include integrated circuits, gate arrays,
building block logic, field programmable gate arrays (FPGA),
etc.
[0064] Although specific embodiments of the invention have been
described above in detail, the description is merely for purposes
of illustration. It should be appreciated, therefore, that many
aspects of the invention were described above by way of example
only and are not intended as required or essential elements of the
invention unless explicitly stated otherwise. Various modifications
of, and equivalent steps corresponding to, the disclosed aspects of
the exemplary embodiments, in addition to those described above,
can be made by a person skilled in the art without departing from
the spirit and scope of the present invention defined in the
following claims, the scope of which is to be accorded the broadest
interpretation so as to encompass such modifications and equivalent
structures.
* * * * *