Lesson 4: Notification of Change and Returned Money

Notification of Change (NOC)

Automated messages

The Automated Clearing House (ACH) system, through which direct deposits travel, provides Notification of Change (NOC) messages to the Comptroller's office. NOCs are automated messages sent back from a payee's financial institution for various reasons. Here are some of the most common:

• The banking information is incorrect
• The banking information has changed
• The account is closed or frozen
• The payee refused the payment
• The payee passed away

The State Treasury receives the NOC transactions and reports them to Payment Services at the Comptroller’s office for processing. NOC actions can be money items or non-money items.

A complete list of return codes is available on the NACHA website. A list of common NOC codes is available under the Resources tab in this training.

Prenote period

During the prenote (prenotification) period, the Comptroller's office may receive NOC items reflecting corrected account information from the financial institution for newly input banking information that TINS automatically updates and corrects.

Payments

For actions involving payments, TINS may delete incorrect account information to prevent additional payments going to incorrect account instructions. Any changes to TINS are listed on the Payee Maintenance History (PMTHIS) screen and reflected on the agency TINS reports discussed later in this lesson.

NOC data

The NOC data for a direct deposit payment that has been returned identifies:

• Type of payment
• Effective date
• Return date
• Dollar amount
• Payee name and ID number
• Account number
• Return Code/Description

Types of NOCs

Money items

When a NOC is for a money item, the NOC data is returned to the Comptroller's office along with the funds from the original direct deposit. Often these actions cause TINS to automatically delete the incorrect account information in the system so no further payments are issued to an invalid account.

Non-money items

For a non-money item, the NOC data may show a direct deposit action where the financial institution kept the money but some of the account information was changed or needs to be corrected.

Next: Returned Money Processing