Accredited ACH Professional (AAP) Practice Exam

What risk management procedure should an Originator of WEB entries implement?

1. Return notifications

2. Fee waivers

3. Fraudulent transaction detection system

4. Immediate refunds

The correct answer is: Fraudulent transaction detection system

The most suitable risk management procedure for an Originator of WEB (Internet-initiated entries) transactions is the implementation of a fraudulent transaction detection system. This option is correct because WEB entries present unique risks related to identity theft and unauthorized transactions due to their nature of being initiated online. A robust detection system helps in monitoring and identifying suspicious activity, thereby reducing the potential for fraud. By utilizing such a system, the Originator can effectively analyze transaction patterns and flag any that appear to be out of the ordinary. This proactive approach helps safeguard not only the financial interests of the Originator but also the consumer's accounts, fostering trust in the electronic payment system. In contrast, return notifications primarily inform the Originator of returns after a transaction has occurred but do not actively prevent potential fraud. Fee waivers are a customer-centric approach that may improve customer relations but do not directly address risk management concerns. Immediate refunds focus on correcting issues post-transaction and may indicate a reactive rather than proactive strategy to manage risk.