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F ederal reserve







Circular No. 73-117
M a y 29, 1973


To All Banking Institutions, and Others Concerned,
in the Eleventh Federal Reserve District
Our Circular No. 73-25, dated January 31, 1973, contained information concerning the use of
restrictive endorsements on bearer United States Treasury securities and on plans for extending
the use of such endorsements to Federal Agency securities. Since then, Treasury Department
Circular No. 853 — “Regulations Governing Restrictive Endorsements of United States Bearer
Securities’ — has been revised, effective April 11, 1973. Enclosed is an excerpt from the Federal
Register of April 30, 1973 setting forth the text of the revision. In addition, most Federal Agencies
have adopted the same restrictive endorsement procedures with regard to their bearer securities.
The revision of the Treasury regulations is intended to simplify the procedures for restrictively
endorsing Treasury securities and to eliminate certain limitations on the use of such endorsements.
In particular, the requirement that a bank’ A B A code number be perforated beneath the endorse­
ment has been eliminated. Also, in addition to those banking institutions previously authorized,
savings and loan associations and building and loan associations are n o w expressly authorized to
use the procedures set forth in the Treasury regulations, and all banks presenting bearer Treasury
securities to a Federal Reserve Bank for conversion into book-entry securities m a y n o w restrictively
endorse such securities.
The bearer securities of the following Federal Agencies are n o w governed by the restrictive
endorsement procedures set forth in Treasury Department Circular No. 853:
Export-Import Bank of the United States
Government National Mortgage Association
Federal H o m e Loan Bank Board
Federal H o m e Loan Mortgage Corporation
Federal National Mortgage Association
United States Postal Service
Washington Metropolitan Area Transit Authority
In addition, the F a r m Credit Administration has issued regulations authorizing the application of
restrictive endorsement procedures to the bearer securities of the Banks for Cooperatives, Federal
Intermediate Credit Banks and Federal Land Banks. Such regulations parallel the Treasury regula­
tions except that they do not, at this time, authorize the use of restrictive endorsements on
securities presented for conversion into book-entry form.
Information and instructions on such matters as the authorized form of the endorsement, the
requirements for endorsement and the procedures for granting relief on account of restrictively
endorsed securities proven to have been lost or stolen are set forth in Treasury Department Circular
No. 853. Instructions on the procedures to be followed in submitting such securities to this Bank,
and a form for that purpose, are enclosed. Additional forms will be furnished upon request.

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (

A s n oted in our C ircular N o. 73-25, th e u se o f th e r e str ic tiv e en d o rsem en t procedures can
m in im ize t h e r isk o f loss a sso cia te d w ith sh ip m e n ts o f va lu ab les and, a t t h e sa m e tim e , effect
sig n ifica n t c o st sa v in g s. T h e re c en t c h a n g e s in th e T rea su ry r e g u la tio n s should fa c ilita te th e use
o f such en d o rsem en ts. A ccord in gly, w e u rge all b an k s in t h is D is tr ic t to m a k e th e fu lle s t p ossib le
use o f t h e r e str ic tiv e en d o rsem en t procedures. T h e officers in c h a r g e o f F isc a l A g e n c y a c tiv itie s
at each o f our offices w ill be p leased to d isc u ss a n y q u estio n s y o u m a y h a v e con cern in g such
Y ou rs v e r y tru ly,
P. E . Coldwell
P r esid en t

E n closu re (s)


T h is form should be typed in triplicate. The original should accompany the shipment,
a copy should be sent under separate cover, and a copy should be retained by the sender.

TO: Federal Reserve Bank, Station K, Dallas, Texas 75222
El P a s o 79999 Houston 77001

San Antonio 78206

The following is a list of bearer se c u r it ie s in the total par amount of $______________ restric tively endorsed, prepared for
shipment and sent to you be the undersigned pursuant to Treasury Department Circular No. 853, R ev is ed , and the instructions
printed on the reverse s id e of this form.
T itle of Loan (or Issue)..


Coupon number*_______


Conversion to Book Entry
Exchange for new is s u e
(See subscription form)

and all subse quent coupons are attached.
Serial Numbers L iste d in Seq uence


Serial Numbers L iste d in Sequence

This is to certify that this list was prepared and checked
under my supervision, and the se cu ritie s listed were pack­
aged and shipped under my supervision.

( S u b m itte r )

(S ig n a tu re and t i t l e of o f fic e r)

(D a te )

(A ddress)

(City an d S ta te )

---------------------- A

* When m ature d s e c u r i t i e s w ith no c o u p o n s a t t a c h e d are su b m i tt e d , the ’’N O N E ” sh o u l d be w ritte n in t h i s s p a c e . I f any u nm ature d
c o u p o n s a re m is s i n g , d e t a i l e d i n fo rm a tio n s h o u l d b e fu rn i s h e d and, i f re d em p tio n i s d e s i r e d , d e d u c t i o n of the am oun t of s u c h c o u p o n s
will be m ade. If e x c h a n g e for a n e w i s s u e i s d e s i r e d , a r e m i t t a n c e for th e am o unt of m i s s i n g c o u p o n s m u s t a c c o m p an y th e s h ip m e n t.

Rev. 2-73

Treasury Department Circular No. 853, Revised, contains the regulations governing restrictive
endorsements or bearer Government and certain Agency s e cu ritie s. The requirements for imprinting
restrictive endorsements on securities and attached unmatured coupons, as set forth in Circular No.
853, should be carefully observed. In addition to the provisions of the circular, the following
instructions are applicable to the processing of securities and their preparation for shipment.
Restrictively endorsed securities of different i s s u e s which are sorted
by issu e , denomination, and serial number may be submitted in a single shipment, but where securities
to be redeemed at or after their maturity or call date are included in the same shipment with those to be
presented for exchange, they should be clearly segregated. Securities submitted for redemption at par
in payment of Federal e s ta te taxes should be similarly separated.
Where securities bearing restrictive endorse­
ments are submitted in exchange before or at maturity pursuant to an exchange offering, and the
securities offered are available in registered form and registration is desired, complete registration
instructions should be given at the time the subscription is entered.
After the submitter has imprinted the endorsements a s set forth
in DC 853 and sorted the securities according to the instructions of the Federal Reserve Bank to which
the submitter will ship the securities, the submitter must prepare a list of all securities of each issue
included in the shipment. The list should be prepared in the order in which the securities are to be
packaged and shipped and should show in the c a se of each iss u e the date of the next maturing coupon,
specifying either that all subsequent coupons are attached or indicating which coupons, if any, are
missing and whether or not remittance for the value of any missing coupons accompanies the securities.
The list should be verified against the securities. One copy of the list should accompany the shipment.
The list must be prepared whether or not the securities are microfilmed in accordance with paragraph 4
4. MICROFILMING OF SECURITIES.-Microfilms or other photographic reproductions of endorsed
securities should be made, where fac ilitie s are available, by banks and District Directors, Internal
Revenue Service. Where securities bearing restrictive endorsements have become lost, stolen, or destroyed,
such film or photographic reproductions will be acceptable to e sta b lish that they were so endorsed prior
to their loss, theft, or destruction. No prints may be made from the film records unless specifically
authorized by a Federal Reserve Bank or the Treasury Department.
5. SUPERVISION OF LISTING AND VERIFICATION .-The listing and verification, as well as
the checking of any photographic reproductions, should be made under the supervision of an officer of
the bank concerned, or an employee authorized by the District Director of the Internal Revenue Service
concerned, who should sign all three copies of the listing. The officer or employee signing the list should
also supervise the packaging and shipment of the s ecurities. The original and triplicate copy of the list,
as well as the photographic records, if made, should be retained by the bank or the District Director,
Internal Revenue Service, until the transaction is completed by receipt or notice of payment or, in
appropriate c a se s , receipt of the securities issued in exchange.

MONDAY, APRIL 30, 1973
Volume 38 ■ Number 82


Fiscal Service,
Bureau of the Public Debt


Dept. Circular No. 853
2d Rev.

No. 82— Pt. IX— -1





Title 31 — Money and Finance: Treasury

securities assigned in blank, or to bearer,
or so assigned as to become, in effect,
payable to bearer.


§ 3 2 8 .2


Certain words and terms, as used in
these regulations, are defined as follows:
(a) “Banks” refer to, and include, in ­
corporated banks (i.e., banks doing a gen­
eral commercial banking business), in ­
corporated trust companies (i.e., trust
companies doing either a general bank­
ing business or a general trust business),
and savings and loan associations, build­
ing and loan associations, and such other
financial institutions as may be desig­
nated by the Federal Reserve banks. This
definition is lim ited to institutions in ­
corporated w ithin the United States, its
territories and possessions, the Common­
w ealth of Puerto Rico and the Canal
(b) “Bearer securities” or “securities'*
are those which are payable on their
face to “bearer,” the ownership of which
is not recorded. They include “Treasury
bonds,” “Treasury notes,” “Treasury
certificates of indebtedness,” and “Treas­
ury bills.”

The regulations in 31 CFR part 328
have been amended for the purpose of
reducing costs of shipping definitive
bearer securities submitted for conver­
sion to book-entry securities or for re­
demptions or exchanges.
Notice and public procedures are un­
necessary and are dispensed w ith as the
fiscal policy of th e United States is in ­
volved. The changes were effected under
authority of R.S. 3706; 40 Stat. 288, 502,
1309; 46 Stat. 20; 48 Stat. 343; 49 Stat.
20; 56 Stat. 189; 73 Stat. 622; 85 Stat. 5,
74 (31 U.S.C. 738a, 739, 752, 752a, 753, 754,
754a and 754b); and 5 U.S.C. 301.
Dated April 11, 1973.
[ seal]



K . C ar lo ck,

Fiscal Assistant Secretary.

Department of the Treasury Circular
No. 853, Revised, dated December 4,1964,
is hereby further amended and revised
and issued as Department of the Treas­
ury Circular No. 853, Second Revision,
effective April 11, 1973.


S cope o f r e g u la tio n s .
D e fin itio n s.
A u th o riz a tio n fo r re s tr ic tiv e e n d o rse ­
m e n ts .
E ffect o f re s tr ic tiv e e n d o rse m e n ts .
F o rm s o f e n d o rse m e n t.
R e q u ire m e n ts f o r e n d o rse m e n t.
S h ip m e n t o f s e c u ritie s .
L oss, t h e f t , o r d e s tr u c tio n o f s e c u ritie s
b e a rin g r e s tr ic tiv e e n d o rse m e n ts .
M iscellan eo u s.

A u t h o r i t y : R .S . 3706; 40 S ta t.
1309; 46 S ta t. 20; 48 S ta t. 343; 49
56 S ta t. 189; 73 S ta t. 622; 85 S ta t.
U .S.C . 738a, 739, 752, 752a, 753, 754,
7 5 4 b ); a n d 5 U.S.C. 301.

§ 3 2 8 .1

288, 502,
S ta t. 20;
5, 74 (31
754a a n d

S cop e o f regu lations.

The regulations in this part are ap­
plicable only to U.S. bearer secu rities1
presented (a) by or through banks for
paym ent at or after their m aturity or
call date, or in exchange for any secu­
rities under any exchange offering, (b)
by banks for conversion to book-entry
securities, (c) by or through banks at
any tim e prior to their m aturity or call
date for redemption at par and applica­
tion of the entire proceeds in paym ent of
Federal estate taxes, provided said secu­
rities by the term s of their issue are
eligible for such redemption, and (d) by
Service Center Directors and District D i­
rectors, Internal Revenue Service, for re­
demption, with the proceeds to be ap­
plied in paym ent of taxes (other than
securities presented under paragraph (c)
of this sectio n ). These regulations do not
apply to bearer securities presented for
any other transactions, or to registered
1 C e rta in ag e n c ie s o f t h e U n ite d S ta te s a n d
c e r ta in G o v e rn m e n t a n d G o v e rn m e n t-s p o n ­
so re d c o rp o ra tio n s also a u th o r iz e t h e r e ­
s tr ic tiv e e n d o rs e m e n t o f b e a re r se c u ritie s .

D efin itio n s.

Revenue Service, in their respective dis­
tricts as to the procedure to be followed
under the authority granted by these
regulations. R estrictive endorsements
shall not be placed on securities until
such inform ation is received from the
Federal Reserve banks.
§ 328.4 E ffect o f restrictive e n d orse­
m en ts.


Bearer securities bearing restrictive
endorsements as herein provided will
thereafter be nonnegotiable and pay­
m ent, redemption, or exchange will be
m ade only as provided in such endorse­
m ents.
§ 328.5 F orm s o f endorsem ent.
(a) Wft:~a presented by banks— (1 )
For payment or exchange.—The endorse­
m ent placed on a bearer security pre­
sented for paym ent or exchange by a
bank should be in the follow ing form:
F o r p r e s e n ta tio n to t h e F e d e ra l R e serv e B a n k
o f __________________________ , F isc a l A g e n t o f
th e U n ite d S ta te s , f o r re d e m p tio n o r in e x ­
c h a n g e fo r s e c u ritie s o f a n e w issu e , in a c ­
c o rd a n c e w ith w r itte n in s tr u c tio n s s u b m itte d
b y ----------------------------------------------------( In s e rt n a m e o f p re s e n tin g b a n k )

§ 3 2 8 .3 A u thorization fo r restrictive e n ­
dorsem ents.

For redemption at par.—The en­
dorsement placed on a bearer security
By banks.—Banks are authorized,presented for redemption at par in pay­
under the conditions and in the form m ent of Federal estate taxes should be
hereinafter provided, to place restrictive in the following form:
endorsements upon the face of bearer
p r e s e n ta tio n to th e F e d e l R
securities owned by them selves or their F o r__________________________ _raF isceserv g eB a n k
al A nt of
customers for the purpose of presenta­ t h e U n ite d S ta te s , fo r re d e m p tio n a t p a r in
tion to Federal Reserve banks or p a y m e n t o f F e d e ra l e s ta te ta x e s , in a c c o rd ­
branches, or to the Treasurer of the a n c e w ith w r itte n in s tr u c tio n s s u b m itte d
United States, as follows:
b y ------------------------ ---------------------------( I n s e r t n a m e o f p r e s e n tin g b a n k )
(1) For paym ent or redemption—at
any tim e w ithin 1 calendar m onth prior
(b) For conversion to book-entry se­
to their m aturity date, or the date on curities.—The endorsement placed on a
which they become payable pursuant to bearer security presented for conversion
a call for redemption, or at any tim e to a book-entry security shall be in the
after their m aturity or call date;
following form:
(2) For exchange—during any period
F o r p r e s e n ta tio n to th e F e d e ra l R eserv e B a n k
for their presentation pursuant to an
o f __________________________ _ F isc a l A g e n t o f
exchange offering;
t h e U n ite d S ta te s , f o r c o n v e rsio n t o b o o k (3) For redemption at par in payment e n tr y s e c u ritie s b y __________________________ _
of Federal estate taxes (only eligible
(In s e rt n am e of
securities)—at any tim e prior to their
p re s e n tin g b a n k )
m aturity or call redemption date; and
(c) When presented by Service Center
(4) For conversion to book-entry secu­
rities under subpart O of part 306 of this Directors or District Directors, Internal
chapter—at any tim e prior to their m a­ Revenue Service.—The endorsement
placed on a bearer security by a Service
turity or call redemption date.
' (b) By Service Center Directors and Center Director or a D istrict Director,
District Directors, Internal Revenue Internal Revenue Service, should be in
Service.—Service Center Directors and the following form :
D istrict Directors, Internal Revenue F o r p r e s e n ta tio n to th e F e d e ra l R e serv e B a n k
Service, are authorized, under the condi­ o f ____- ______________________ F isc a l A g e n t o f
tions and in the form hereinafter pro­ t h e U n ite d S ta te s , fo r re d e m p tio n , t h e p r o ­
vided, to place restrictive endorsements ceed s to b e c re d ite d t o t h e a c c o u n t o f th e
upon the face of bearer securities for the S erv ice C e n te r D ire c to r, I n te r n a l R e v e n u e
purpose of presentation to Federal R e­ S erv ice, a t _________________ , f o r c r e d it o n
l _______________________ta
serve banks or branches, or to the Treas­ th e F e d e r a(In c o m e , g if ts , o r o th e r ) x e s d u e
urer of the United States, for redemp­ f r o m ____________________________ _
tion and application of the proceeds in
paym ent of taxes (other than securities
(N am e a n d a d d re ss)
presented for redemption at par and ap­
plication of the proceeds in payment of § 3 2 8 .6 R eq u irem en ts fo r en d orsem en t.
Federal estate ta x e s).
On bearer securities.—The en­
Instructions from Federal Reservedorsement m ust be im printed in th e leftbanks.—Federal Reserve banks will in ­ hand portion of the face of each security
form eligible banks and Service Center w ith the first line thereof parallel to the
Directors and D istrict Directors, Internal le ft edge o f .t h e security and in such




m aimer as to be clearly legible and in cases of exchange, rem ittance equal to the general regulations governing U nited
such position th a t it w ill not obscure the the face am ount of th e m issing coupons States securities.) Except for bearer se­
serial number, series designation, or m ust accompany the securities. All m a­ curities subm itted for redemption at par
other identifying data, and cover the tured coupons, including coupons which in paym ent o f Federal estate taxes, a
sm allest possible portion of the text on w ill mature on or before th e date of bank will be considered th e owner of se­
th e face of th e security. The dimensions redemption or exchange (except as curities handled on behalf o f customers
of the endorsement should be approxi­ otherwise specifically provided in an an­ unless it otherwise requests. The appli­
m ately 4 Inches in width and iy 2 inches nouncem ent of an exchange offering), cation for relief (form PD 2211) and in ­
in height, and m ust be im printed by should be detached from securities upon structions w ill be furnished by the Fed­
stam p or plate of such character as will which restrictive endorsements are to be eral Reserve banks.
render the endorsement substantially in ­ imprinted.
Bond of indemnity .—Where secu­
eradicable. The nam e of the Federal R e­
rities bearing restrictive endorsements
§ 3 2 8 .7 S h ip m en t o f securities.
serve bank of the district m ust appear
shipped by a bank have been lost, stolen,
on th e plate or stam p used for the im ­
Securities bearing restrictive endorse­ or destroyed, a bond of indem nity w ith
printing of the endorsement, and pres­ m ents m ay be shipped, at the risk and surety satisfactory to the Secretary of
entation to the appropriate branch of expense of the shipper, by registered the Treasury w ill be required from the
the Federal Reserve bank named will be mail, messenger, armored car service, or owner. If such bond is executed by a bank
considered as presentation to the bank. express to the Federal Reserve bank of or other corporation, the execution m ust
W hen securities are to be presented to the district in which the presenting be authorized by general or special reso­
th e Treasurer of the United States, the bank, the Service Center Director, or the lution of the board of directors, or other
words “Treasurer of the U nited States" D istrict Director, Internal Revenue Serv­ body exercising sim ilar functions under
should be used in lieu of the words “Fed­ ice, is located, or to the appropriate its bylaws. Ordinarily, no surety will be
eral Reserve Bank o f ________________, branch of such Federal Reserve bank, required on a bond executed by a pre­
F iscal Agent of the U nited States.” No shipm ents to the Treasurer of the United senting bank. The Secretary of the
subsequent endorsement w ill be recog­ States, W ashington, D.C., should be Treasury reserves the right, however, to
require a surety in any case in which he
nized. If the form of endorsement on a made by messenger or armored car.
considers such action necessary for the
security is different than th at prescribed
§ 3 2 8 .8 Loss, th e ft or d estruction o f protection of the United States.
in § 328.5, the provisions of §§ 328.7 and
secu rities bearin g restrictive en d orse­
328.8 shall not apply to the security.
§ 3 2 8 .9 M iscellan eou s.
m ents.
On coupons.—Unmatured cou­
pons attached to restrictively endorsed
General.—R elief will be provided The provisions of this circular are sub­
securities should be canceled by im print­ on account of securities bearing restric­ ject to the current revision of Depart­
ing the prescribed endorsement in such tive endorsements proved to have been m ent Circular No. 300. The Secretary of
m anner th at a substantial portion of the lost, stolen or destroyed, upon the own­ the Treasury reserves the right at any
endorsem ent w ill appear on each such er’s application, in the same manner as tim e to amend, supplement, or withdraw
coupon. If any such coupons are m issing, registered securities which have not been any or all of the provisions of these
deduction of their face am ount will be assigned. (See subpart N of the current regulations.
m ade in cases of redemption, and in revision of Department Circular No. 300,
[F R Doc.73—
7401 F ile d 4 -2 7 -7 3 ;8 :4 5 a m ]