In November 2011, the Federal Reserve Bank introduced a new variation on the basic customer transfer, a payment message that includes Extended Remittance Information (ERI). It's a wire transfer that includes invoice details, 9000 bytes worth of invoice details.
There are banks and financial institutions that require that the purpose be present on wire transfers. There are jurisdictions that encourage/require that the purpose be present on wire transfers. In the SWIFT world, there are typically 210 bytes available for this purpose. The Fed provides space for 9000 bytes.
With 4 double-spaced pages on invoice data accompanying the payment; at what point do your payment AML concerns start sounding like trade finance AML concerns? (NOTE: Invoice details are completely fictional.)
Is the amount of the payment equal to the sum of the invoiced items?
Are the goods listed over-priced or under-priced?
Looking at the example invoice data below, what do you do if the payment is for $15,000?
Is $2.00 too much or too little for a polyester pajama top?
For example:
FABRIC: 100 PERCENT POLYESTER JERSEY -200GSM
EACH
STYLE NO. DESCRIPTION PO QTY COST SHIP DATE
EB58BD76 MILITAR STAR
LAYERED SLEEVE PJ TOP 2914 420 2.00 07-01-07
EB58BE88 SPORTS SHIELD
L/SLV PJ TOP 2914 576 2.00 07-01-07
EB58BC76 MILITARY STAR
LAYERED SLEEVE PJ TOP 2914 588 2.00 07-01-07
EB58BB88 SPORTS SHIELD
LONG SLV PJ TOP 2914 564 2.00 07-01-07
EB58BD76 MILITAR STAR
LAYERED SLEEVE PJ TOP 2915 108 2.00 07-01-07
EB58BE88 SPORTS SHIELD
L/SLV PJ TOP 2915 162 2.00 07-01-07
EB58BC76 MILITARY STAR
LAYERED SLEEVE PJ TOP 2915 162 2.00 07-01-07
EB58BB88 SPORTS SHIELD
LONG SLV PJ TOP 2915 162 2.00 07-01-07
EB58BD76 MILITAR STAR
LAYERED SLEEVE PJ TOP 2616 72 2.00 07-01-07
EB58BE88 SPORTS SHIELD
L/SLV PJ TOP 2916 144 2.00 07-01-07
EB58BC76 MILITARY STAR
LAYERED SLEEVE PJ TOP 2916 144 2.00 07-01-07
EB58BB88 SPORTS SHIELD
LONG SLV PJ TOP 2916 138 2.00 07-01-07
EB58BD76 MILITARY STAR
LAYERED SLEEVE PJ TOP 2917 84 2.00 07-01-07
Are the goods consistent the nature of the parties?
For example:
Originator: Wal-Mart
Beneficiary: Samsung
50 Televisions, Model LN26R71BAX/XBG
90 Televisions, Model LN32R71BAX/XBG
10 Functional MRIs, Model MagFinder II
Are the goods of a high-risk nature?
Are there instructions to trans-ship items to an unrelated third party?
Originator: Cabela’s
Beneficiary: Argus Publications
890,000 12 GAUGE 00 BUCKSHOT
5,800,000 9mm BALL
9,600,000 5.56x45mm M200
10,000 40mm HEDP
4,500 20mm VULCAN HEIT SD M246 WITH M14A2 LINK
100,000,000 M855 5.56 Ball
20,000,000 5.56mm Tracer
16,700,000 5.56mm Blank
5,700,000 5.56mm 4 Ball/1 Tracer
13,600,000 7.62mm Ball Long
790,000 .50 Caliber 4 Ball/1 Tracer
10,000 40mm HEDP Grenades
32,000 60mm HE Mortar Rounds
32,000 60mm Illumination Rounds
5,000 81mm HE Mortar Rounds
5,000 81mm Illumination Rounds
7,000 Signal Flares
7,300 Stun Grenades
6,700 HC Smoke Grenades
12,035 M4 Carbines
What if (and I suspect this is the most likely case) the included invoice detail does not tell you a darn thing about the payment?
For example:
PO NO LINE QTY PRICE TOTAL LSHIPDATE COLR
-------- ----- ------ ------- ---------- ---------- ----
SK233C 711 16 130.03 2080.48 2007-07-15 WBP
SK242C 712 12 66.01 792.12 2007-07-15 WCM
SK243C 713 25 66.01 1650.25 2007-07-15 GRN
SK244C 714 9 70.12 631.08 2007-07-15 KCO
SK930R 231 19 207.62 3944.78 2007-07-25 BLK
SNK930 1003 31 207.62 6436.22 2007-07-25 BLK
SNK931 1004 79 63.99 5055.21 2007-07-25 PLD
SNK932 1005 80 43.66 3492.79 2007-07-25 GRY
SNK932 1006 75 43.66 3274.49 2007-07-25 OLV
SNK950 1014 180 108.36 19504.80 2007-07-30 GRY
SNK951 1015 172 39.90 6862.80 2007-07-25 AAP
SNK951 1016 220 39.90 8778.00 2007-07-25 BLK
SNK952 1017 12 21.09 253.07 2007-07-20 BLK
SNK952 1018 89 21.09 1877.01 2007-07-20 BLY
SNK952 1019 134 21.09 2826.06 2007-07-20 RAS
SNK952 1020 95 21.09 2003.55 2007-07-20 ROS
SNK953 1021 28 40.61 1137.08 2007-07-25 BBE
SNK953 1022 410 40.61 16650.10 2007-07-25 CBB
SNK953 1023 143 40.61 5807.23 2007-07-25 CPD
SNK953 1024 220 40.61 8934.20 2007-07-25 FDG
SNK953 1025 32 40.61 1299.52 2007-07-25 OCB
SNK954 1026 561 43.46 24381.06 2007-07-20 BBE
SNK954 1027 701 43.46 30465.46 2007-07-20 CBB
SNK955 1028 425 43.46 18470.50 2007-07-20 FDG
SNK956 1029 770 43.46 33464.20 2007-07-20 CPD
SNK956 1030 535 43.46 23251.10 2007-07-20 WPD
SNK957 1031 147 43.46 6388.62 2007-07-20 OCB
The inclusion of invoice data on payments certainly provides a benefit to commercial customers; they can, more or less clearly, marry the payments to the goods. The inclusion of invoice details on a payment also suggests to banks and their regulators that more information is available on these payments with which to answer critical questions. In most cases, though, the bank will have data, but it will not have usable information.
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