Effective July 15, 2008, the Federal Reserve Banks are amending Operating Circular No. 3, Collection of Cash Items and Returned Checks, to address an emerging practice in the electronic collection and return of checks. It has come to the Reserve Banks’ attention that some banks take payment instructions from consumers over the Internet, convert those instructions to electronic “templates,” and send them to a Reserve Bank for collection as electronic items under Operating Circular 3. These items do not qualify as “electronic items” because the images they contain were not originally captured from paper checks.
To address this issue, the operating circular is being amended in the following respects:
- Paragraph 1.3(d) now makes clear that a bank may send data to a Reserve Bank in the form of an electronic item only if the data was captured from a paper check.
- New paragraph 2.3 provides that every sender that transmits data to a Reserve Bank for collection or return as an electronic item warrants that the data is an electronic item as described in revised paragraph 1.3(d). Senders also indemnify each Reserve Bank that handles such data for any loss, claim or damage that results from the breach of the warranty.
Your continued use of Reserve Bank services on or after the effective date of these amendments constitutes agreement to the new terms of the operating circular.See the link below on the Federal Reserve Financial Services website for the official version of the amended operating circular. To request a paper copy of any operating circular, contact your Customer Contact Center.