Disclosures Regarding Third-Party Providers of Payment Services
A copy of a letter dated March 26, 1998, to Alan Greenspan, Chairman of the Board of Governors of the Federal Reserve System, from John D. Hawke, Jr., Under Secretary for Domestic Finance of the U.S. Treasury Department is available as a file (pdf - 9kb).
Secretary Hawke notes in the letter that some financial institutions have entered into arrangements for payment services with third-party providers in connection with the move to mandatory electronic federal payments in 1999, or plan to do so. He also expresses the Treasury Department's view that insured finanical institutions that enter into these arrangements should provide certain disclosures regarding the fees involved and other matters.
We urge your cooperation in helping to ensure that your institution provides appropriate disclosures to customers when it participates in arrangements with third-party providers of payment services, with respect to electronic transfer of federal payments.