With check payments in steep decline and alternatives on the rise, the Federal Reserve Bank of Atlanta says it plans to set up a unit to evaluate retail payment risk management.
Richard R. Oliver, an executive vice president at the Atlanta Fed and manager of the Fed's retail payments office, said the unit, announced Tuesday and to be named the forum for retail payments risk management, will focus initially on the blurring boundary between checks and automated clearing house transactions.
Law enforcers and regulators focus on issues such as fraud in each area, but as check and ACH payments have converged in recent years, "I began to realize over time that none of the parties were talking to one another," Mr. Oliver said.
The unit will be headed by a Fed attorney, Clifford S. Stanford, and recruit an advisory board of 10 to 20 members in the next two months, drawing from bankers, regulators, and law enforcers.
As an example of the forum's project, Mr. Oliver noted that the Federal Financial Institutions Examination Council is revising its manual for evaluating institutions' ACH operations. The Fed unit could guide this revision by establishing protocols for sharing information, for instance, on whether a bank was originating ACH debits in volumes out of line with its peers.
Though the forum has a broad mandate, it probably will not pursue matters such as card fraud. "There are plenty of people working in the card space," he said.
And as payment systems evolve, so will the forum's mission. "As lines blur over time, we will find ourselves working where the lines blur," he said.
