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F ederal R eserve Ba n k o f D allas DALLAS, TEXAS 75222 C i r c u l a r No. 77-30 F e b r u a r y 24, 1977 R E V IS IO N OF B U L L E T IN 11 T O A L L BANKS IN T H E E L E V E N TH FE D E R A L RESERVE D IS T R IC T : Enclosed is a r e v is e d copy of o u r B u lle tin 11, " In s tr u c tio n s to C o lle ctin g Banks and P aying B a n k s ," e ffe c tiv e M a rc h 1, 1977. T h is re v is io n to the cash item o p e ra tin g b u lle tin c o ve rs the p r o c e d u re fo r m aking r e s e r v e account adjustm ents r e la tin g to cash lette rs re c e iv e d b y p a y in g b a nks on a day w h ic h is a h o lid a y for the F e d e ra l R e s e rv e office m a in ta in in g the settlem ent account. I f you ha ve a n y questions o r comments about this r e v is io n , please c o n tact J . A . C l y m e r , A s s is ta n t V ic e P r e s id e n t, a t E x t. 6337, o r the o ffic e r in c h a rg e of the Checks D e p a rtm e n t at the El Paso, H ouston, o r San A ntonio B r a n c h . A d d i tional copies of B u lle tin 11 w ill be fu r n is h e d upon re q u e s t to the S e c r e ta r y 's O ffice of this B ank (E x t. 6267) . S in c e r e ly y o u r s , R o b e rt H . B oy k in F ir s t V ic e P re s id e n t E nclosure Banks and o th e r s a re en c o u ra g e d to u s e th e f o llo w in g t o l l - f r e e in co m in g WATS nu m b ers in c o n ta c tin g t h is Bank: 1 - 8 0 0 - 4 9 2 - 4 4 0 3 ( i n t r a s t a t e ) and 1 - 8 0 0 - 5 2 7 - 4 9 7 0 ( in t e r s t a t e ) . For c a l l s p la c e d lo c a l l y , p l e a s e u s e 651 p lu s th e e x te n s io n re fe r r e d to a b o v e . This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) BULLETIN 11 Instructions to Collecting and Paying Banks FEDERAL RESERVE BA N K OF DALLAS SCOPE T his b u lletin se ts forth the in stru ctio n s to be f o llo w e d in the hand ling of, and p aym ent or rem ittance for, ch e c k s and other cash ite m s conta in ed in cash letters r e c e iv e d from this Bank. TABLE OF CONTENTS S e c tio n 1, D EFIN ITIO N S A N D GENERAL PR O V ISIO N S 1.00 C ollection contract 1.05 A u th o rity 1.10 D efinitions, referen ce to R egulation J 1.15 R e fe r e n c e to B ulletin 1 1.20 U s e o f term “w ir e ” 1.25 A p p lic a b ility of this bulletin S e c tio n 2, PRESEN TM EN T FOR PA Y M EN T S e c tio n 3, ENDO R SEM EN TS 3.00 C ash ite m w ith o u t e n d o rsem en t 3.05 W arranties S e c tio n 4, PA Y M E N T FOR C A SH LETTERS 4.00 4.05 4.10 4.15 4.20 4.25 Tim e o f p ay m en t Form o f p a y m e n t A d ju stm e n t for reserve com putation C ollecting banks D ifferences and adjustm ents Late claim s fo r error adjustm ents S e c tio n 5, RETURN ITEM S 5.00 R e c o v e r y 5.05 T im e for return b y c o llectin g banks 5.10 W arranty of c o llectin g banks 5.15 W arranty o f pay in g b ank s 5.20 Return w ith o u t entry 5.25 R e a so n for n o n p a y m e n t on item 5.30 Federal R eserve r e sp o n sib ility 5.35 M ain ten a n ce o f records 5.40 P rov isio n al credits S e c tio n 6, U N IFO RM IN ST R U C T IO N S REG A RDING PR O TEST A N D A D VICE OF N O N P A Y M E N T 6.00 6.05 6.10 6.15 G eneral U n ite d States ob ligations R e sp o n sib ility of pay in g bank R e sp o n sib ility o f this Bank S ectio n 7, PROCEDURES 7.00 Standardization, sorting, routing, and m e c h a n iz e d p r o c e ssin g 7.05 R eferen ce to Bulletin 8 7.10 Cash letters r e c e iv e d in m utilated conditio n 7.15 Photographic cop ies SUPPLEM ENT A , Return o f C ash Item s FEDERAL RESERVE BANK OF DALLAS BULLETIN 11 Section 1, DEFINITIONS AND GENERAL PROVISIONS item s are p r e se n te d is treated as a paying bank for all p u rp o ses o f R egulation J and operating bulletins is su e d in c o n form ity therew ith. T his b u lletin is directed to the m em ber b anks of the E le v e n th Federal R e se r v e D istrict and others concerned: Section 2, PRESENTMENT FOR PAYMENT 1.00 C ollectio n contract A s c o n tem p la ted b y se c tio n 210.7 o f R egulation J, any c a sh item: A tte n tio n o f co lle c tin g banks, pay in g banks, and no n b a n k payo rs is directed to se c tio n 210.3 of R egulation } w h ic h p r o v id e s that the p r o v isio n s o f that regulation and o f the operating b u lletins o f this Bank are b inding u p o n e a ch collectin g bank, payin g bank, and n o n b a n k p a y or to w h ic h this Bank or a n y su b se q u e n t co lle c tin g bank, presents, sen d s, or forw a rd s a cash item r eceiv ed by us. 1.05 A u th o rity This bulletin, our Bulletin 8, and our tim e s c h e d u le s (Bulletin 10] are iss u e d p ursuant to the p r o v isio n s o f se c tio n s 4, 13, 14(e), and 16 o f the A c t and the p r o v isio n s o f related sta tu tes and in c o n fo rm ity w ith the p r o v isio n s o f R egulation J. 1.10 D efinitions, referen ce to R egulation J A ll terms defined in R egulation J and u se d herein shall h a v e the m ean in g s stated in that regulation.1 1.15 R eferen ce to B ulletin 1 D efinitions and rules o f con struction applicable to this bu lletin are fo u n d in our B ulletin 1, G en eral P ro v isio n s, and are in corp orated herein by reference. 1.20 U s e o f term “w ir e ” For the p u r p o se s o f this bulletin, the term “w ir e ” in c lu d e s telep h on e, telegraph, cable, or other form o f electron ic te le co m m u n ica tio n s. 1.25 A p p lica b ility o f th is b u lletin The p r o v isio n s o f this b u lle tin are app licable to an y state, or a n y county, district, p o litical su b d ivision, or m u n icip ality th e r e o f to w h ic h w e p resen t direct, as cash item s, any bills, notes, and w arrants is s u e d by su ch state, county, p oliti cal su b d iv isio n , or m u n icip a lity and p a y ab le in this district. Each su c h issu e r to w h ic h cash (1) M ay be p re se n te d for p a y m e n t b y u s or a su b se q u e n t c o lle c tin g bank; (2) M a y b e sent by u s or su b se q u e n t collecting bank for p r e se n tm e n t and p aym ent; or (3) M ay be fo rw a rd ed b y u s to a su b se q u e n t c o l le c tin g bank w it h authority to presen t it for pa y m e n t or to sen d it for p r esen tm en t and paym ent. Section 3, ENDORSEMENTS 3.00 C ash item w ith o u t en d o rsem en t If a cash item is re c e iv e d b y a Federal R eserv e Bank from a sen d er w ith o u t the endo rsem en t thereon o f su ch sender, w e m ay: (1) P resent, send, or forw ard the item as if it bore su ch en dorsem en t; (2) Place on the ite m the n a m e o f such sender and the date o f its receipt by us; or (3) R eturn the ite m to the sen d er for proper e n d o r se m e n t b y the sender. 3.05 W arranties T his Bank m a k es the w arranties se t out in s e c tion 210.6(b) o f R egulation J b y presenting, se n d ing, or forw ard in g a c a sh ite m pursuant to se c tio n 3 o f our Bulletin 8. T h e se w arranties arise w h e th e r or not su ch item bears the e n d o r se m ent o f this Bank. Section 4, PAYMENT FOR CASH LETTERS 4.00 T im e o f p a y m en t P a ym ent or rem ittance for our ca sh letter m ust be m ad e b y a p a y in g bank for all accom p an yin g cash ite m s w h ic h shall n o t h a v e b een returned by said bank prior to the clo se o f its banking day 'For the p u r p o se s o f this b u lle tin as w e l l a s for the p u r p o se s of R e g u la tio n J, the V irgin Isla n d s and Puerto R ico sh all be d e e m e d to b e in or o f the S e c o n d F ederal R e se r v e D istrict; G uam a n d A m e r ic a n S a m o a sh a ll b e d e e m e d to b e in or o f the T w e lf t h F ed era l R e se r v e District. BULLETIN 11 FEDERAL RESERVE BANK OF DALLAS on w h ic h su ch cash item s are rec e iv e d .2 Such p a y m e n t or rem ittance3 shall be m ade at par and in the m anner h ereafter provided: (1) D ebit to an a c cou n t on our books; (2) Cash; or (3) In our discretion, any other form of p aym ent or rem ittance. The p r o c e e d s o f any su ch p a y m e n t or rem ittance in any form herein stated shall be a vailable to u s n o t later than the clo se o f the banking day for u s on w h ic h su c h ite m s w e r e so re c e iv e d by the payin g bank. If the banking day on w h ic h su c h ite m s are re c e iv e d by a pay in g bank is not a banking day for us, an y p a y m e n t or rem ittance m ade hereunder shall be effected on the n e x t banking day of b o th this Bank and su ch paying bank n e x t fo llo w in g the day of receipt o f such item . 4.05 Form o f p a ym en t T his Bank m a y require the pay in g b ank to w h ic h it h a s p r e se n te d or se n t any cash item to pay or rem it therefor in cash, but p a y m e n t m a y be m ade, in our d iscretion b y an y of the fo llo w in g m e th o d s w h ic h is in a form a cceptab le to us: the paying bank b e c a u se su ch day of receipt w a s not a banking day for such Federal R eserve Bank, this or such other Federal R eserve Bank m ay m ake appropriate adjustm ents as o f such day o f receipt (unless such day is a Saturday) for purp oses of com putation of reserv es under R egulation D of the Board of G overnors of the Federal R eserve System . 4.15 C ollecting b anks A s u b se q u e n t co lle c tin g bank (other than a F ed eral R eserv e Bank] to w h ic h the payin g bank has paid or rem itted for a ca sh item as herein pro v id e d sh all pay or remit the p r o c e e d s to the F ed eral R eserve Bank w h ic h forw a rd ed the item to it in such fa sh io n that the p ro c e e d s th e r e o f w ill be available to such Federal R eserve Bank n ot later than the clo se o f the banking day, for such Federal R eserv e Bank, on w h ic h the p ro ceed s w e r e r e c e iv e d by su ch su b seq u en t collecting bank. 4.20 D ifferences and ad ju stm en ts (3) O ther form s w h e r e sp ecial arrangem ents have b e e n m ade. U n le ss a payin g bank ha s o th e r w ise agreed w ith this Bank, w h e n a pay in g bank p ay s or remits for our cash letter in an am oun t n o t in agreem ent w ith the total o f the cash letter b e c a u se the a c c o m p an yin g cash item s do not prov e to the am ount o f the cash letter, a co m plete e x p la n a tion o f the difference should be furnished on our appropriate form. P aying b anks are re q uested to refrain from reporting adjustm ents o f $1.00 or le ss. 4.10 A d ju stm en t for reserve com p utation 4.25 Late claim s for error adju stm ents If pay m en t or rem ittance for an item is effected by m eans of a debit to an accou n t on the books o f this or another Federal R eserve Bank on a banking day for su ch Federal R eserve Bank fo l lo w in g the b anking day of receipt of the item by W e w ill send to m em ber banks and other d e p ositors m aintaining an a c co u n t on our b o ok s sta tem en ts of account, w h ic h m a y be supported by adv ices, w ith re sp e c t to entries in such an accou n t m ade by us in accordance w ith the (1) A utho rization to charge the a c cou n t on our b o o k s o f a m em ber or n on m em b er clearing bank; (2) C ash letter agreem ent plan (autom atic charge; se e our B ulletin 12); or 2A c a sh item r e c e iv e d b y a p a y in g b a n k sh a ll b e d e e m e d to h a v e b e e n r e c e iv e d by the b a n k on its n e x t b a n k in g day if the item is r e c e iv e d un der o n e o f the f o llo w in g c ircu m sta n ces: (1) O n a da y other than a b a n k in g da y for it, or (2) O n a b a n k in g d a y for it, but (a) A fte r its regular b a n k in g hours, or (b) A fte r a “cut-off h o u r ” e sta b lis h e d b y it in ac co r d a n ce w ith a p p lica b le state law , or (c) During a fte rn o o n or e v e n in g p e r io d s w h e n it is o p e n for lim ited f u n ctio n s only. 3T his Bank w ill charge aga in st a m e m b e r p a y in g b a n k ’s r es er v e a c co u n t the am o u n ts o f c a sh lette rs r e c e iv e d from or through this Bank b y su ch p a y in g bank, in the a b s e n c e o f a n y a rran gem ent to pro v ide for p a y m e n ts and r em itta n c es in so m e other m a n n er and in the a b s e n c e of in str u c tio n s to the contrary w ith r e s p e c t to a n y sp ecific c a s h letter. FEDERAL RESERVE BANK OF DALLAS p r o v isio n s of R egulation J and our operating bulletins. If, w ith in o ne calendar year from the date of an entry in su ch an account, such a d ep o sitor fa ils to a d v ise us in w riting of its objectio n to su ch an entry, the depositor, and any sender, c o lle c tin g bank, or paying bank u sin g the accou n t m aintained by the d ep ositor w h ic h has h an d le d the item to w h ic h the entry relates, shall be d e e m e d to h a v e ap proved the entry and the statem en t o f a c co u n t shall be d eem ed finally ad justed. T he foregoing shall n o t relieve su ch a depositor from the duty o f ex e r c isin g due dili g e n c e to e x a m in e sta te m e n ts o f accou n t sent to it and o f n o tify in g u s im m e d ia te ly upon d isc o v e r y o f any error, nor shall it apply to cla im s based u p o n the breach of a w arranty in resp ect of an item to w h ic h an entry relates by a Federal R ese r v e Bank. Section 5, RETURN ITEMS 5.00 R ec o v e r y If a p a yin g b ank returns to us an u npaid cash item in acco rdance w ith the p r o v isio n s of s e c tion 210.12 o f R egulation f,4 it m a y recover any p ay m en t or rem ittance thereto fo re m ade b y it for su ch ite m by requesting a credit therefor to an accou n t on our b ooks; and paying banks are urged to f o llo w this procedure to the exten t practicable. H o w e v e r , a n y su ch payin g bank may return any such u np aid item to us for refund. 5.05 T im e for return b y c ollectin g ban k s A n y c o llectin g bank w h ic h r e c e iv e s an unpaid cash item from a p ay in g bank for return to us is h ereby directed to forw ard the return item to us b e fore m idnight o f its n e x t banking day fo llo w in g the banking day of its receipt of the return item , or as su ch tim e m ay be exte n d e d by operation o f se c tio n 210.14 o f R egulation J. 5.10 W arranty o f co llectin g banks A co lle c tin g bank w h ic h takes or r e c e iv e s a credit or obtains a refund for the am ount o f any rem ittance m ade by it in respect o f a cash item forw ard ed to it by u s and returned to us by it thereby: (1) W arrants to us and to the sender o f the item and all prior parties thereon that its return o f the unpaid item to us w a s tim ely; and BULLETIN 11 (2) A g r e e s to in d e m n ify u s for any lo s s or e x p e n se su sta in e d (including but n ot lim ited to a tto r n e y s’ f e e s and e x p e n s e o f litigation) resu lt ing from its breach o f such warranty. 5.15 W arranty o f p ay in g b an k s In accord ance w it h se c tio n 210.12(b) of R egu la tion J, each p a y in g ban k w h ic h tak es or r e c e iv e s credit or ob tains a refund in resp ect o f a cash item r e c e iv e d b y it from or through us, w a r rants to us, to any su b se q u e n t co llectin g bank, and to the sen d er and all prior parties that it took all a ction n e c e ss a r y to entitle it to recover such p a y m e n t w ith in the tim es lim ited therefor. 5.20 Return w ith o u t entry A p ayin g bank or a co lle c tin g bank m ay return to us w ith o u t entry a cash ite m w h ic h the paying bank or c o llectin g bank did n o t return on time, w ith the request that w e ask our sen d er to m ake refund therefor, in w h ic h e v e n t w e shall m ake refund to the p a y in g bank or co lle c tin g bank and charge our sender on ly if the latter s p e cifically authorizes us to do so. 5.25 R eason for n o n p a ym en t o n item Each cash item returned unpaid sh ou ld bear a notation clearly indicating the reason for n o n paym ent. 5.30 F ederal R eserv e r esp o n sib ility If w e are o n ce fu rn ish ed w ith a cash item a c c o m pan ied by a statem en t, sig n ed by an authorized rep resen ta tive o f a sen d er (other than a Federal R eserve Bank), that, u p o n the inform ation and b e lie f o f su ch sender, the p ay in g bank did not take all action n e c e ss a r y to entitle it to recover its p a y m e n t or rem ittance for su ch ca sh item w ith in the tim es lim ited therefor b y the prov i sio n s o f R egulation J, thereby ca using lo s s to the sender, w e shall, on the basis o f such statem ent, charge the am ount o f the ite m to the accou n t m aintained or u s e d by, and forw ard the item to, the c o lle c tin g bank or p ay in g bank to w h ic h the item w a s originally presented, sent or forw arded by us and credit the a c cou n t on our b o o k s o f the sender (or Federal R ese r v e B ank fu rn ishing such item and statem ent) w ith that am ount; provided, h o w e v e r , that su c h credit to the sen d er shall be 'S e c tio n 210.12 of R eg u la tio n J is set forth in S u p p le m en t A to this bu lletin. BULLETIN 11 FEDERAL RESERVE BANK OF DALLAS r e v o k e d if for any reason w e can n o t obtain the a m ount o f su ch credit from the p ay in g bank, and su ch credit to the sen d er shall be r e v o k e d if w e su b se q u e n tly re c e iv e n ot later than fifteen (15) banking d ays after w e fo rw ard ed the item to the co lle c tin g bank or p ayin g bank as p rovided in this paragraph, the sam e c a sh item acco m panied b y a statem ent, sig n ed b y an authorized rep r e se n ta tiv e o f the p ayin g bank, that the paying bank to o k all action n e c e ssa r y to entitle it to recov er its p a y m e n t or rem ittance w ith in the tim es lim ited therefor by th e p ro v isio n s of R egulation J, and the pay in g bank (or collecting b an k furnishing su ch item and statem ent) w ill b e credited accordingly. N o Federal R eserve Bank shall h a v e any r e sp o n sib ility for determ in ing w h e th e r the p a y in g bank to o k all action n e c e ss a r y to en title it to rec o v e r su ch p ay m en t or rem ittance or w h e th e r the return o f the item to it b y a co lle c tin g bank w a s tim ely. payin g b a n k s and c o llectin g banks m u st receive, handle, and forw ard ca sh item s in accordance w ith the fo llo w in g unifo rm in stru ctio n s regard ing p ro test and w ire a d vice of n o n paym ent; and any contrary or sp e c ia l in stru ctio n s n o te d on cash letters or oth e r w ise transm itted w ith cash item s are to be disregarded: 5.35 M ain ten a n ce o f records (b) A n y item o f $2,500 or over u n le ss it is protestab le u nder subparagraph (1). (3) WIRE AD V IC E o f n o n p a y m e n t o f any item o f $2,500 or over, u n le ss it h a s n ot b e e n paid b e c a u se o f a m issing, irregular, or u n sa tisfa c to r y en d o r se m e n t or u n le ss it bears on its fa c e the legend, “D O N O T W I R E N O N P A Y M E N T , ” o f a Federal R e se r v e Bank or a preceding bank en dorser. Include in the a d vice o f non p a ym en t, the am oun t of the item , the reaso n for n o n p a y m ent, the date o f our cash letter, the n am e of the drawer or maker, and the n a m e s o f all en dorsers p receding the Federal R eserve B ank or their A B A transit num bers, i f any. W ire ad v ic e s o f n o n p a y m e n t sh o u ld be furn ish ed in a form sim ilar to that w h ic h is u s e d in the f o llo w ing specim en: For its o w n protection each pay in g and c o lle c t ing b an k returning cash item s to u s for any rea so n sh o u ld m aintain a dequate records to per m it the reproduction or tracing o f a n y ite m s lo st or d e str o y e d in transit. 5.40 P ro v isio n a l credits If a payin g bank or a collecting bank m akes, in accordance w ith applicable state law , a direct return to the depositary bank o f an unpaid cash item w h ic h it h a s re c e iv e d from or through us or any other Federal R eserve Bank, any prov i sion a l credit for the item: (1) B e tw e e n su ch payin g bank or collectin g bank and this Bank or any other Federal R eserve Bank; (2) B e tw e e n this Bank or a n y other Federal R e serve Bank and the sender; and (3) B e tw e e n this Bank and any other Federal R eserve Bank shall b e c o m e and rem ain final. Section 6, UNIFORM INSTRUCTIONS REGARDING PROTEST AND ADVICE OF NONPAYMENT 6.00 G eneral E x c e p t as p ro v id ed in se c tio n 6.05 h ereof, all (1) PR O TEST any d ish on ored item o f $2,500 or over: (a) W h ic h appears on its face to h a v e been draw n at a p la ce w h ic h is n ot w ith in any sta te ,5 u n le ss it bears on its fa c e the A B A n o-protest sym b o l o f a Federal R eserve Bank or of a pre ceding bank endorser, or (b) W h ich bears on its fa c e the legend, “PRO TEST R E Q U I R E D , ” of a Federal R eserv e Bank or of a p recedin g bank endorser. (2) DO N O T PROTEST: (a) A n y item o f le ss than $2,500, or Returning $2,513.24 insufficient fu n d s y ours 18th m aker John D oe en d o rsed 37-2 17th 88-4185 16th and Richard Roe. (4) DO N O T WIRE A D V I C E of n o n p a y m e n t of: (a) A n y item le s s than $2,500; or (b) A n y item o f $2,500 or over u n le ss such ad v ic e is required by subparagraph (3). 6.05 U n ited S ta te s oblig atio n s DO N O T P R O T E S T A N D DO N O T W I R E A D V I C E of n o n p a y m e n t o f any cash item , regard- 'The term “st a t e ” is defined in se c t io n 210.2(n) o f R e g u la tio n J to m e a n a n y sta te o f the U n ite d S ta tes, the D istrict of C olum bia, or Puerto Rico, or a n y territory, p o s s e s s i o n , or d e p e n d e n c y o f the U n ite d States. FEDERAL RESERVE BANK OF DALLAS BULLETIN 11 le s s o f am ount, e n d o r se d b y the U n ited States Treasury, or e n d o rsed for credit to the U nited S tates Treasury, or bearing on its fa c e or in an e n d o r se m e n t the legend, “T his ch e c k is in p a y m en t of an obligation to the U nited States and m ust be p aid at par. N.P. D o not w ire n o n p a y m e n t.” or w o r d s of sim ilar import. 6.10 R esp o n sib ility o f p ay in g bank The p ayin g bank shall be r e sp o n sib le for m aking or provid in g for any p rotest o f a cash item protesta b le u n d er the p r o v isio n s o f this bulletin and for giving any w ir e a d v ice o f n o n p a y m e n t required b y the p r o v isio n s hereof, e x c e p t as m ay be o th e r w ise p ro v id ed by the rules or practices o f any clearing h o u s e through w h ic h the item w a s p re se n te d or by a g reem ent b e t w e e n this Bank and the pay in g bank. 6.15 R esp o n sib ility o f th is Bank T his Bank shall h a v e n o r e sp o n sib ility for deter m ining w h e th e r an y other bank resp o n sib le therefor has (a) m ade or p rovided fo r the protest o f any ca sh item protesta b le hereunder, or (b) giv en any w ire advice of n o n p a y m en t required hereunder. Section 7, PROCEDURES 7.00 S t a n d a r d iz a t io n , m ec h a n iz e d p ro cessin g s o r t in g , r o u t in g and To facilita te the sorting, routing, and m e c h a n ized p ro c e ssin g o f cash item s, and thereb y prom ote earlier p r esen tm en t and return o f unpaid item s, payin g banks are urged: (1) In c o n fo r m ity w ith the A B A M agnetic Ink Character R ecog n itio n Program, to preprint the routing s y m b o l and the suffix o f the transit n u m ber on all cash item s in m agnetic ink in E-13B type in the m anner prescribed, and at the lo c a tion assigned, by the A B A . (2) To clearly im print the appropriate transit num ber-routing sy m b ol in fractional form in the upper right corner o f all cash item s p ayab le by or through su c h p a yin g banks, preferably in G othic type, and the fa c e o f w h ic h m ea su res at lea st 8 p o in ts v ertica lly or 1 / 9 of an in ch from the top to the b o tto m of the in d ividual characters. (3) To con fo rm cash item s to the standards pre scribed by the A BA , in clu d in g a m inim um w id th o f 23A inch es, a m a x im u m w id th o f 32/s inches, a m inim um len gth o f 6 in ch es, and a m a xim um len gth o f 83/4 in ch es, and to restrict c a sh item s to a single th ic k n e ss o f card or paper. (4) Cash item s returned by c o llectin g banks and paying banks sh ou ld not bear on the back o f the endorsem ent, paid or other id en tifyin g stam p of the paying bank u n le ss that stam p has been can celled. This Bank or another R eserve Bank w h ic h has h a ndled an item , shall not assum e any resp o n sib ility to the sender, to any other o w n e r or holder o f the item , or to any other per son, for any delay resulting from action taken by a R eserve Bank in returning an item on the basis of the u n c a n celled endorsem ent, paid or other id en tifyin g stam p o f the paying bank on the back o f the item. 7.05 R eferen ce to B ulletin 8 The attention o f pay in g banks and collecting banks is called to our Bulletin 8, to the effect that: (1] T his Bank m a y present, send, or forw a rd any cash item , in accordance w ith sectio n 210.6 of R egulation J, on the basis of: (a) A n y A B A transit num ber or routing sym b o l appearing thereon at the tim e o f its receipt by us, w h e th e r inscrib ed by m agn etic in k or b y any other m eans, and w h e th e r or n ot su ch transit num ber or routing sym b o l is c o n s is te n t w ith each other form o f d e sign a tio n of the pay in g bank [or n o n b a n k payor) then appearing thereon; or (b) A n y other form o f d e sig n ation o f the payin g bank [or no n b a n k payor) then appearing thereon, w h e th e r or n ot c o n s iste n t w it h any A B A transit num ber or routing sy m b o l then appearing there on; and [2) If, in our judgm ent, the p r o c e ssin g o f any c ash item by u s requires the inscrip tion there on in m ag n etic ink, or o th erw ise, of the A B A transit num ber, the routing sym bol, or both, o f the p ay in g bank (or n onbank payor) or requires the in scrip tion thereon in m agn etic ink o f the am ount o f su ch item , w e m ay so in scribe the item and present, send, or forw ard it acco rd ingly; and the sen d er o f su ch item shall be d eem ed to a ssu m e the risk o f lo s s resulting from delay cau sed by the act o f inscribing such am ount or such num ber, sym bol, or both. 7.10 C ash letters r e c e iv e d in m utilated co n d itio n In the e v e n t that our cash letter is r e c e iv e d in a m u tilated condition, p le a se te lep h on e this Bank b e fo re attem pting to fu n ctio n any portion there FEDERAL RESERVE BANK OF DALLAS of. U n d er certain co n d itio n s w h e n the cash letter is returned intact, tracing and identification o f m utila ted or destr o y e d ca sh ite m s is exped ited . 7.15 P hotograp hic c o p ie s In the e v e n t w e receive, as a cash item , a prop erly prepared photographic c o p y of a lo st or destr o y e d item w h ic h w a s eligible for handling as a cash item , w h ic h c o p y bears a current en d o rsem en t o f the send er and the fo llo w in g le g end, or one o f eq u iva len t effect, sig n ed by or in b e h a lf o f the sender: “T his is a photographic fa csim ile of the original c h e c k w h ic h w a s end orsed by the u n d ersigned and reported lost, stolen, or d e str o y e d w h ile in the regular course o f bank collection . A ll prior and any m issin g e n dorsem en ts and the v a lid ity o f this fa c sim ile are h ereb y guaranteed, and upon p a y m e n t h e r e o f in lieu o f th e original check, the und ersign ed w ill h o ld each collecting ba n k and the pay or bank h a rm less from any lo s s suffered, p ro v id ed the original c h e c k is u npaid and p a y m e n t is sto p p e d th e r e o n .” w e w ill p r esen t or sen d the c o p y as a ca sh item to the p ay in g bank (or n o n b a n k payor) subject to all the rules as to p a y m e n t or rem ittance for, and return of, ca sh item s; and w e urge paying b anks (and n o n b a n k payors) to a c cep t su ch p h o to c o p ie s for h a n d lin g as cash item s. H o w e v e r , if a p ayin g bank (or n o n b a n k payor) d e c lin e s to han d le the c o p y as a ca sh item but is w illin g to h an d le it as a n o n c a s h item , w e w ill charge back to the sender th e am ou nt o f the co p y and w ill p resen t or sen d the c o p y to the payin g bank (or n on b an k payor) as a n o n c a sh ite m u n d er the term s o f our current b u lletin relating to the c o l lection o f n o n c a s h item s; or, if su ch p ayin g bank (or n on b an k payor) r e fu se s to h an d le the copy, w e w ill charge back the am ount o f the c o p y and return the c o p y to th e sender. Supplement A RETURN OF CASH ITEMS S e c tio n 210.12 o f R egulation J, caption ed “Return o f Cash Item s,” p r o v id e s as f o llo w s: “ (a) A p a y in g b a n k that r e c e iv e s a ca sh item fro m or through a Federal R ese r v e Bank, oth er w is e than for im m ed ia te p a y m e n t over the BULLETIN 11 counter, and that p a y s or rem its for su ch item as p ro v id ed in § 210.9(a) o f this Part sh all h av e the right to recover any p a y m e n t or rem ittance so m a d e if, before it ha s finally paid the item, it returns the item b e fore m idnight of its b a n k ing day n e x t f o llo w in g the banking d ay o f re ceipt or takes su ch other action to reco ver such p a ym en t or rem ittance w ith in su ch tim e and by su ch m e a n s as m a y be pro vid ed b y applicable State la w : P r o v id e d , that th e fo rego in g p ro v isio n s shall n o t exten d , nor shall the tim e herein p ro vid ed for return b e e x te n d e d by, the tim e for return o f unpaid ite m s fixed by the r u l e s a n d p r a c t i c e s o f a n y c le a r i n g h o u s e through w h ic h the item w a s p re se n te d or fixed by the p r o v isio n s o f any sp e c ia l co llectio n a greem ent p ursuant to w h ic h it w a s presented. (b) A n y p a y in g bank w h ic h takes or r e c e iv e s a credit or obtain s a refund for the am oun t o f any p a ym en t or rem ittance m ade by it in respect o f a cash ite m r e c e iv e d by it from or through a Federal R ese r v e Bank shall b e d e e m e d (1) to w arrant to su ch Federal R ese r v e Bank, to a su b se q u e n t co lle c tin g bank, and to the sender and all prior parties that it took all action n e c essa r y to entitle it to recov er su ch p a y m e n t or rem ittance w ith in the tim e or tim es lim ited there for b y the p r o v isio n s o f this part, b y the appli cable rules and practices o f a n y clearing h o u se through w h ic h the item w a s presented, b y the applicable p r o v isio n s o f any sp ecia l co lle c tio n agreem ent pursuant to w h ic h it w a s presented, and, e x c e p t as a longer tim e m a y b e afforded b y the p r o v isio n s o f this part, by applicable State law ; and (2) to agree to in d e m n ify such F ederal R ese r v e Bank for any lo s s or e x p e n se su sta in ed (including but n o t lim ited to atto r n e y s’ f e e s and e x p e n s e s of litigation) resulting from its a ction in g iving su ch credit or m aking such refund, or in m aking any charge to, or obtaining any refund from, the sender. N o Federal R eserve Bank shall h a v e a n y r e sp on sib ility to su ch p a y ing bank or any su b se q u e n t c o llectin g bank or to the sender o f the item or any other prior party thereon for d eterm ining w h e th e r the action h e r e in a b o v e referred to w a s tim e ly .”
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