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FEDERAL RESERVE BOARD WASHINGTON X-7210 ADDRESS OFFICIAL CORRESPONDENCE TO T H E FEDERAL RESERVE BOARD J u l y 22, 1932. SUBJECT: A u d i t o f R e s e r v e S t o c k of I n c o m p l e t e Federal Reserve Notes. Dear S i r : For y o u r i n f o r m a t i o n t h e r e i s i n c l o s e d a c o p y o f t h e r e c a p i t u l a t i o n o f a n a u d i t of t h e s t o c k o f i n c o m p l e t e F e d e r a l r e s e r v e n o t e s o f t h e F e d e r a l r e s e r v e "banks h e l d a t t h e B u r e a u o f E n g r a v i n g a n d P r i n t i n g a s o f c l o s e of b u s i n e s s J u n e 3 0 , 1 9 3 2 , f o r w a r d e d t o t h e S e c r e t a r y o f t h e T r e a s u r y "by Mr. M. R. l o a f man, C h i e f , D i v i s i o n of P u b l i c Debt A c c o u n t s and A u d i t . I n a c c o r d a n c e w i t h a r r a n g e m e n t s made "between t h e T r e a s u r y D e p a r t m e n t a n d t h e F e d e r a l R e s e r v e Board a r e p r e s e n t a t i v e o f t h e Board was p r e s e n t d u r i n g t h e p r o c e s s o f t h e a u d i t . In h i s l e t t e r forwarding the report of the audit to t h e S e c r e t a r y o f t h e T r e a s u r y , Mr. Loafman s t a t e d t h a t : "The a u d i t e x t e n d e d f r o m J u l y 1 t o 7 , i n c l u s i v e , and c o n s i s t e d o f a p i e c e c o u n t of t h e e n t i r e s t o c k o f F e d e r a l r e s e r v e n o t e f a c e s and a p a c k a g e count of t h e u n i f o r m "backs a l l o c a t e d to Federal reserve notes. In v i e w of the f a c t t h a t a r e c e n t p i e c e c o u n t h a s b e e n made b y t h i s o f f i c e o f t h e e n t i r e s t o c k X-7210 — 2 — o f e a c h d e n o m i n a t i o n o f u n i f o r m "backs on hand i n t h e B u r e a u , a p a c k a g e i n s p e c t i o n o f t h e u n i f o r m "backs a l l o c a t e d t o F e d e r a l r e s e r v e n o t e s w a s deemed s u f f i c i e n t a t t h i s t i m e . The t o t a l f a c e s and "backs a u d i t e d w a s f o u n d t o "be i n e x c e s s o f t h e r e quired r e s e r v e of 4 , 2 5 0 , 0 0 0 s h e e t s of incomplete n o t e s , f a c e s and "backs a s a u t h o r i z e d i n t h e l e t t e r o f t h e G o v e r n o r o f t h e F e d e r a l R e s e r v e B o a r d t o t h e Under S e c r e t a r y o f t h e T r e a s u r y u n d e r d a t e o f December 2 , 1 9 2 9 . * * * With r e s p e c t t o t h e t o t a l f a c e s a n d "backs o f t h e $ 5 0 d e n o m i n a t i o n , i t w i l l b e n o t e d t h a t t h e f a c e s a r e g r e a t e r a n d t h e "backs f e w e r i n p r o p o r t i o n t h a n t h e q u a n t i t i e s s p e c i f i e d t o "be h e l d i n r e s e r v e . T h i s c o n d i t i o n was c a u s e d "by t h e w i t h d r a w a l o f "backs f o r p r i n t i n g f a c e s f o r t h e F e d e r a l R e s e r v e Bank o f C h i c a g o , i n accordance w i t h supplemental p r i n t i n g orders dated June 23 a n d 2 5 , 1 9 3 2 , a n d t h e a p p a r e n t s h o r t a g e i n $ 5 0 "backs i s more t h a n o f f s e t "by t h e e x c e s s q u a n t i t y i n $ 5 0 f a c e s on h a n d . " Very t r u l y y o u r s , E . M. M c C l e l l a n d , Assistant Secretary. Inclosure. TO ALL F. R. AGENTS.
@FedFRASER