Wire Room

A wire room is a financial institution's funds transfer operation, or its operating department. This department is responsible for receiving customer orders from a registered representative, transmitting the order to the exchange floor or the firm's trading department, relaying notices of executed trade orders to the appropriate registered representative, and receiving payment orders.

In a bank, the wire room handles transfers between accounts and electronic payments from accounts. Certain larger firms have entire staffs dedicated to the wire room; smaller firms may have staff rotate between the wire room and other responsibilities.

When a broker in a brokerage receives an order from a client, he or she takes the order to the wire room. Staff in the wire room then send the order to the brokerage’s representative on the floor of the stock exchange. That representative buys the ordered stock, and then sends the purchase information back to the wire room. The wire room contacts the broker, letting him or her know that the client’s stock order is complete. The broker then contacts the client to let him or her know that the order has been filled.

In a bank, the wire room may have access to a FedLine PC, or, if it’s a smaller bank, it may have banking software that allows it to create payment orders in the Fedwire Funds Service format, so they can be uploaded to the FedLine PC at another facility. The FedLine PC is used to access Federal Reserve Bank services.

When a bank receives a payment order from a corporate or individual customer, it sends that order to the wire room where an employee keys the order into the FedLine system. The wire room also receives incoming payment orders for that bank.

A wire room should keep a record of all incoming and outgoing payment orders, which is often done via a printout of all messages sent and received. Staff needs to check this printout regularly to make sure no messages are missed, and report missing messages immediately.

Any institution with a wire room should have security procedures in place to make sure that all incoming and outgoing payment orders are legitimate and accurate. Security procedures can include having a second staff member review outgoing payment orders, using code words and call backs, and authorizing only certain employees to send and receive payment orders.