Steve Stone, a senior vice president in treasury management operations at PNC, said the Pittsburgh banking company has been building the database since February, using an archive hosted by eGistics Inc. of Dallas.
Robert E. Lund, eGistics' chairman and chief executive, said the archive already stores lockbox information from several major transaction processors but that PNC is the first big banking company to shift its payments records to his system.
"I'm not aware of anybody who has done it," he said. With PNC, "we're going to have, to our knowledge, the first enterprise payment archive in a big bank."
As more payments are handled electronically, the banking company's ACH receipt volume has grown and so has the number of investigations, research requests and other demands for stored information, Stone said in an interview last week.
This increasing need to search through its payments records prompted the company to find a system that offered easier search functions.
PNC uses Fiserv Inc.'s PEP-Plus ACH processing system to post transactions to its accounting systems, Stone said, but the software is designed more for processing than long-term storage, he said. "PEP-Plus doesn't lend itself well to doing the kind of investigations we needed to do."
For one thing, it stores data only for 60 days, Stone said; after that, it goes into offline storage, where research cannot be done very efficiently. With the archive, "we can save it for as long as we want to pay for saving it."
The archive also gives researchers an annotation capability so that they can include the case number of an investigation and the issue's resolution, he said.
PNC has begun to see results in Regulation E complaints, Stone said. "It makes it easier to see certain patterns of behavior that wouldn't be obvious if you were looking statement by statement," he said.
That Federal Reserve rule gives consumers up to six months to complain about unauthorized debits, Stone said, adding, "What I never could see before was how many of those kinds of inquiries an individual consumer might have made over time."
The archive has let PNC track multiple complaints by individuals, he said, which can indicate a pattern of fraud.
"We have discovered there were a couple of people who are very frequent users of their Reg E rights in disputing certain transactions," he said. "It's going to cause us to go look at those account relationships and make sure that's the kind of customer we want to have."
These cases involved big-ticket disputes over purchases by telephone or online, he said. In a hypothetical case, he described a single customer that might dispute the purchase of flat-screen television from one merchant, a surround-sound system from another merchant and so on.
"On a merchant-by-merchant basis it doesn't look unusual, but you look at the relationship overall and it starts to look questionable," Stone said. "You have to question whether there may be somebody trying to abuse the system."
As PNC continues to build the archive, it will become more valuable, Stone predicted. For example, a law enforcement agency could potentially ask the bank to produce two years of ACH history for a group of accounts involved in a fraud case. Such a report would not be not easy to do in Pep-Plus, he said, but it could easily be done through the archive, "one inquiry, one time, one place, and it's all done."
