Electronic Fund Transfer Act (EFTA): Federal law that provides a basic framework establishing the rights, liabilities, and responsibilities of participants in electronic fund transfer (EFT) systems.
Regulation E: Federal Reserve regulation that implements the Electronic Fund Transfer Act, providing specific guidelines for electronic banking operations.
NACHA Operating Rules: Rules governing the ACH Network, providing guidelines for direct deposit transactions and other electronic fund transfers.
Gramm-Leach-Bliley Act: Federal law requiring financial institutions to explain their information-sharing practices and protect sensitive data.
Fair Labor Standards Act (FLSA): Federal law establishing standards for wage payments and other employment practices that must be considered in payroll processing.
State Wage Payment Laws: State-specific regulations governing the timing, method, and requirements for wage payments to employees.
Bank Secrecy Act: Federal law requiring financial institutions to assist government agencies in detecting and preventing money laundering.
USA PATRIOT Act: Federal law including provisions for customer identification and verification requirements for bank accounts.
State Data Privacy Laws: State-specific regulations governing the collection, storage, and protection of personal and financial information.
Voluntary Authorization Requirement: Legal requirement that direct deposit must be voluntarily authorized by employees, with clear terms and conditions.
Right to Withdraw Authorization: Legal requirement that employees must have the right to withdraw their direct deposit authorization and receive alternative form of payment.
Information Security Requirements: Federal and state requirements for protecting sensitive banking and personal information collected for direct deposit purposes.
