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FEDERAL RESERVE BANK OF NEW YORK No. 1 December 31, 1987 J [ Circular 10211 DISPUTED RETURNS OF UNPAID CASH ITEMS Elevemfti Supplement to Operating Cireeflair No. 4 To All Depository Institutions in the Second Federal Reserve District, and Others Concerned: In accordance with uniform Federal R eserv e System p o licy , the procedure for disputing the tim eliness o f return o f cash item s has been amended to require that the send er’s allegation o f late return be subm itted within six months from the date o f return o f the item. In addition, the paying ban k ’s denial o f late return form m ust be received by the R eserv e B a n k w ithin 15 banking days after the date the R eserve B an k sent the sender’s allegation o f late return form to the paying bank; other w ise no credit w ll be given to the paying bank. T h e revised procedure is sum m arized as follow s: 1. If a sending bank asserts, within six months from the date o f return of the item, that it has incurred a financial loss as a result of the late return of an item, its Federal Reserve office, without examining the circumstances of the case, will upon receipt of the unpaid item and a written statement (on a form prescribed by us) alleging late return o f the item and damages to the sender, provisionally credit the sending bank’s account and provisionally debit the paying bank’s account for the amount of the item. 2. If, within 15 business days (for the Reserve Bank) after the item has been forwarded to the paying bank, the paying bank asserts that the return of the questioned item was timely and re turns the item accompanied by a statement (on a form prescribed by us) of the details of its timely handling, the Federal Reserve office, again without examining the circumstances of the case, will recredit the paying bank and reverse the credit to the sender’s account. 3. If the banks involved wish to dispute the representations made in the statements described above, it is expected that they will correspond directly with each other to resolve the dispute. E n clo sed is a copy o f the Eleventh Supplem ent to our O perating C ircular N o. 4 , “C o llectio n o f Cash Item s,” reflecting the foregoing changes. (OVER) A lso enclosed are form s that should be used by sending or paying banks w hen requesting credit for a late return item ; the form should be submitted to this B an k in duplicate. I f you have any questions on this m atter, you may con tact any o f the follow ing: H ead O ffice M atthew I . P u g lisi, M anager, C h eck A djustm ent D epartm ent (T el. N o. 2 1 2 -7 2 0 -6 5 5 1 ) B u ffalo B ranch D avid P. Schw arzm ueller, O perations O fficer (T el. N o. 7 1 6 -8 4 9 -5 0 1 8 ) C ranford O ffice Fred A . D en esev ich , R eg ion al M anager (T el. N o. 2 0 1 -2 7 2 -9 0 0 0 ) Je r ic h o O ffice Anthony N. Sag lian o, R eg ion al M anager (T el. N o. 5 1 6 -9 9 7 -4 5 0 0 ) Utica O ffice Angus J . K enned y, R egion al M anager (T el. No. 3 1 5 -7 6 8 -2 2 0 0 ) E . G e r a l d C o r r ig a n , President. F ed era l R ese r v e Bank o f Mew Y o r k Eleventh Supplement to Operating Circular No. 4 (Revised effective November 13, 1980) December 31, 1987 COLLECTION OF CASH ITEMS Disputed Reterms of Unpaid Cash Items To All Depository Institutions in the Second Federal Reserve District, and Others Concerned: Effective December 3 1 ,1 9 8 7 , paragraph 38 of Operating Circular No. 4 is amended to read as follows: 38. If a sender (other than a Reserve Bank) believes that a paying bank has returned a cash item late, the sender may dispute the return one time by the follow ing procedure: (a) The sender may furnish us (or another Reserve Bank), within six calendar months from the date of return of the item or other notice by this or the other Reserve Bank, with the item and, on a form prescribed by us, a signed statement that the sender believes that the paying bank did not take all action necessary to recover its payment within the time limits of Regulation J. We will credit the amount of the item to the sender’s account (or the ac count of the forwarding Reserve Bank). We will charge that amount to the account of (and send the item and statement to) the collecting or paying bank to which we had originally presented or sent the item. (b) We will revoke the credit given to the sender and recredit the col lecting or paying bank if: (i) for any reason we cannot obtain the amount of the credit from the paying bank, or (ii) we (or another Reserve Bank) receive the item with a properly executed statement from the paying or collecting bank within fifteen (15) banking days (for the Reserve Bank) after we (or the other Reserve Bank) sent the item and the sender’s statement to the collecting or paying bank. (c) A properly executed paying bank’s statement must: [Enc. Cir. No. 10211] (OVER) (i) be on a form prescribed by us, (ii) be signed by an officer of the paying bank, (iii) show the banking day of receipt and the date of return of the item by the paying bank, and explain any difference in dates exceeding one banking day, and (iv) state that the paying bank took all action necessary to recover its payment within the time limits of Regulation J. E. Gerald C orrigan , President. Flying In stitu tion 's Response to Lete Return Xtma Claim S Federal Reserve Bank 2D t c S s te of debit &t c £ < °£ o & fe£»i M f e t e C H S ja fe @2 _ _ Branch) ° I§ 3 fe 0 8 ( ' ______ Offii?T S@sms&sS f e e s d a ia @f la te gQfemm ( § 2 0 ^ o We certify that our records indicate that th is itan was received ty us or our <joz@mm3K dq q <§^gh £fe£M m t e t e a g (Safe} ®osb le tte r dated _ o in fete mmsit ©£ $ n feqp ‘fesfe^l » c M r? Mo&si Q &&zm g©s 0 o ©m te tlf e s s tta cmt feMo KQbsm item fe© (o^rbsS _________________p 0 fe@fe^l 0 ~t7* Msfesd ifesss f©g- 0 Wld Q p M q gofeasu lo tted o fegoca o S§fete <§£ mis fi^sni fe®_______________ l______________ few ® g fe@ a,@ g tejt2 0 fe fe e ) e (date) fe M o ife e m o I f the lumber of banking days from the banking day of receipt to the date of return osg®@d§ ms tettssg dsy fete e ^ le m t t o for fete (telay io os iM te s s We took a ll action necessary to e n title us to recover our payment within the tin e limit® ^ p la fc to 3m Wlsm% e stflii our asmmt mA advieto •fitter 9aotm9 i f no wire or telephone n otification was given. Sfe^are and siianit in duplicate. Failure to provide a ll information reguested and/@g failu re to return to your local Federal Reserve Office occpleted forms with the return item within 15 business days fron date of charge w ill resu lt in claim being returned wifctafe mts^o Reserve Banks vU l* In no case, examine the items in question or the statements o f o!2®gsi facts to ascertain the va lid ity o f the claims in carrying out th is procedure. o Knowingly making a fa lse statement on th is Form to influenoe the action of a Federal Reserve Bank in granting a cred it may subject the signing party to criminal penalties m & ir la t e r a l m ffe a te to o Sender'* la te Heturn It m Q*lm Sate: M l EX3^Q @g 1 ■ B rasS s) « S E 5 S > Hbe returned cash it m described belov end attached i s being delivered to you becsM <s£ KHUHN. So /t o s s f e ^ = = = = = = ^ 2o @3tsS So is p r TPW ~0 <Go S2jf©£ S g ^ itto So f°§f (£2)gC59g3 do S^feMQ fe® (^ 5 2 $ ^o @ !&j£g I __ ' _■■ _ (a te ^ l H o . Oo @ar in stitu tion C3nt feMo (scmb fefed fe© . • £sa a ©sub &Gfefe2£ (SafecS .________ ^ fegfeadfctf 0 fegfeal 0 ° te s m 0* 0o S id © it m ‘ ..' c M O o f? to S S s tefegda u m fe g fe te g ^ L n g te fe d fe s s fe to © a (^fe2S> o S@o \J5g SG©2tei fete gQtasa ifcO (SJH &feQ5) __ . 2 e<§3 S^3£ t a k in a gofeM fefesa &Gfefeog (Safest c = = = = = _ _ fegfealfeg O n fe«°9 fegfeaS, 0 A t® m 2 m ° 0 m • l r? Sdcfeoi fefeoon 0 P Cs (2jL©£s <$&tQ fe© (sm Eoms@M t e l fete G rfogs^^tii t e ofea^p m fete fefesaff fete jp yfef to ^ fe ssite (add m t fete a ll asfeta ztsm&mgy fe® sg§§^@? t e u if c M cg M fete fe te Stefea @ £ go§oi^Si te fp la fe te <§Tt e tig ©ssfel^ fetefe? oa fe® ^ f e f e <§£ dishonor, CCSB3C ©@) G B Wise @r feolsgtais t e t e ©a (Date) d I ShA© la te K® t e t e © fe te s f e t a } f e te g Q i^ U g n S ^ ife G ^ o © ante s§g fe® t e a ? f e t e ^ a l t e % te© aeo @g I t e ®f a a t t e i ^ f fe® (Mte^p fete fefeds* back'to ©m @3ifeg®2£(? ®k 2m ©fetes goasg^Bo • M o m Q m o M t g r e ^ ig io n illy (s m t e te to o (Sending Institution) m U < & 3 K uB y r® p a re g (2 3 ^ fe t e o iio M fe ^ a £ a § £ p & fe ^ G $ is a & g l£ © a fe © o M jn g [ M 1 s* s>g fe® p r ® ? M !3 o 2 J g G p 9 © fe G i ^ 1 2 , g © fe ia ® s g c A ^ ta s fe O sfeg^fo Heserve Banks v i l l , in no case, ezaiine the Ite m in question or the ststaaents of «r^(sp3 facts fe® &®@arfeaM t e (^2 (^Late carrying ©sfe feMii p?@si£®Qo Knowingly ©sking o ^ol®2 DtafesMfe m feMs S m ^ e lank in fr s B tte a ©reSife esgf ©r tofes to o fe® £iri£IutK§2 fete o©t£©« @f o Fteder^. fete fe@ |p^fedG§
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