Which action is NOT taken by ARC in the event of a second dishonored draft within 12 months that is not resolved within 24 hours?

Which action is NOT taken by ARC in the event of a second dishonored draft within 12 months that is not resolved within 24 hours?

• A. File a petition with the local courts to recover monies owed to ARC on behalf of the participating carriers
• B. Withhold future remittances to the agency until the matter is resolved
• C. Notify the agency in writing of the dishonored draft and pursue collection actions
• D. Initiate an internal review of the agency's reporting procedures

Answer: (A)

A second dishonored draft that isn’t resolved within 24 hours is handled through internal controls and collection steps rather than immediate legal action. The action described—filing a petition with local courts to recover monies—is not part of ARC’s typical immediate response in this scenario. Instead, ARC would withhold future remittances to the agency until the matter is resolved, notify the agency in writing of the dishonored draft and pursue collection actions, and initiate an internal review of the agency’s reporting procedures to prevent recurrence. Withholding remittances stops funds until the issue is fixed, written notice creates an official record and triggers collection efforts, and an internal review helps identify and fix gaps that allowed a second dishonored draft to occur. Filing a petition would be a more formal legal route and not the immediate step described in this context.

A second dishonored draft that isn’t resolved within 24 hours is handled through internal controls and collection steps rather than immediate legal action. The action described—filing a petition with local courts to recover monies—is not part of ARC’s typical immediate response in this scenario. Instead, ARC would withhold future remittances to the agency until the matter is resolved, notify the agency in writing of the dishonored draft and pursue collection actions, and initiate an internal review of the agency’s reporting procedures to prevent recurrence. Withholding remittances stops funds until the issue is fixed, written notice creates an official record and triggers collection efforts, and an internal review helps identify and fix gaps that allowed a second dishonored draft to occur. Filing a petition would be a more formal legal route and not the immediate step described in this context.