The Federal Reserve’s system that allows financial institutions to send electronic money back and forth failed Wednesday morning.
The “operational error,” as the Fed described it, impacted multiple services, including the crucial automated clearing system, which links custodians and related institutions that send electronic credit and debt transfers.
There was no initial indication that foul play was suspected.
In addition to the Fed ACH service, other affected systems were the Check 21, FedCash, Fedwire and the national settlement service.
A statement from the central bank said it became aware of an issue around 11:15 a.m.ET.
“Our technical teams have determined that the cause is a Federal Reserve operational error. We will provide service status updates as more information becomes available,” the Fed said.
The statement further noted that the outage was affecting payment terms and said the Fed will “communicate recovery efforts to our customers when they are available.”
No further information was available.
The list of affected services: Account Services, Central Bank, Check 21, Check Adjustments, FedACH, FedCash, FedLine Advantage, FedLine Command, FedLine Direct, FedLine Web, Fedwire Funds, Fedwire Securities, National Settlement.
Outages, especially with the ACH system, can have far-reaching consequences. The system handles direct deposits from payroll, Social Security and income tax refunds, as well as automatic payments for mortgages and utility bills.
FedCash distributes currencies and coins, which have been tight since the Covid-19 pandemic broke. FedWire is a settlement service, while FedLine provides alternative services to the ACH system.