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FEDERAL RESERVE BOARD
WASHINGTON
X-jl29
SUBJECT:
Collection of Checls Deposited for Credit in
Treasurer 1 s General Account with Federal Reserve Banks
Dear Sir:
For your informatior. and t:,uidance, there is
enclosed
herev~ith
a copy of a letter. under date of
May
23, from Assistant Secretary of tne Treasury Gil bert;
authorizing Federal Reserve Banks to send checks deposited for credit in the Treasurer's account with
Federal Reserve Banks direct to drawee banks, and advising that if Federal Reserve Banks send these checks
to other banks they will be responsible in case
collection is not made.
Very truly yours,
Vice-Governor.
To CHAIRMEN OF ALL FEDERAL RESERVE BA.NKS.
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TREASURY DEPARTMENT
Washington
Ma.y 23 .. 1921.
X-3129a
Dear Governor Harding:
! received your letter of May 14th with respect
to the collection of checks by Federal Reserve Banks., arid am
in en~ire agreement with tne views which you express.
I
shall appreciate it, therefore, if you will advise Federal
Reserve Banks that they are authorized to send checks de·
posited for the Treasurer 1 s account direct to drawee banks;
and tba t if Federal Reserve Ba.nks send these checks to other
banks they will be resp~'nsiblA in case collection is not made.
Of course, :i.n presenting checks to drawee banks the Federal
Reserve Banks will exer·ci~:>e all possible precautions and
where there is any doubt as to the solvency of a bank will,
if possible, make presentation over the counter.
There are a few pending cases of checks which
are uncollected because of bank failures. In most of these
cases. the drawee bank ha.s not zrade payment .. and it will,
therefore, be possible to ha1fe r.ecourse upon the dl·awer. It
would gre:ttly facilitate the settlement of the i.tw rP.roaining,
cases if the Fecleral Reserve Banks invol vi?ld would mE?.ke payment
of the sums involved to the Treasury and prove cla. ;.ms on their
own behalf a~inst the failed banks. I should app~eciate your
advice as to whether this is feasible.
Very truly yours,
\
(Signed) S. P. Gilbert,
Jr.~
Assistant Secretary of the Treasury.
Hon. W. P. "G. Harding1
GovernorJ Federal Reserve Board.
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