Sec. 821.18 Functions of Federal Reserve Banks. 321.19 Supplements, amendments, etc. Exhibit A. Exhibit B. AUTHORITY: §§ 321.1 to 321.19, inclusive, issued under R.S. 161, 40 Stat. 291, as amended, 55 Stat. 7; 5 U.S.C. 22, 31 U.S.C., Sup., 757c. SOURCE: §§ 321.1 to 321.19, inclusive, contained in 1944 Department Circular 750, Secretary of the Treasury, Sept. 5, 1944, 9 F.R. 10846. Subpart A-Authority to Act of § 321.1 Banks and trust companies authorized to act. All banks and trust companies, incorporated under general or special laws of the United States, the District of Columbia, any State, territory or insular possession of the United States, or the Canal Zone, are eligible and are hereby authorized, on and after October 2, 1944, to make payments in connection with the redemption United States Savings Bonds, subject to the provisions of this part and any instructions issued hereunder: Provided, however, That each bank or trust company must be duly qualified by the Federal Reserve Bank of the district' before it may make any such payment. Federal Reserve Banks, as fiscal agents of the United States, are authorized to qualify eligible banks and trust companies hereunder, and to terminate any such qualifications as hereinafter provided. §321.2 Application and qualification. Any eligible bank or trust company which desires to qualify to make payments in connection with the redemption of United States Savings Bonds should make application to the Federal Reserve Bank of the Federal Reserve District in which it is located on Application-Agreement Form PD 1958 (see appended exhibit A), copies of which may be obtained from the appropriate Federal Reserve Bank. If the application is approved, the Federal Reserve Bank will forward 1For the purpose of this part, banks and trust companies in Puerto Rico, the Virgin Islands and the Canal Zone shall be considered as being within the Second Federal Reserve District and shall make application to the Federal Reserve Bank of New York, and banks and trust companies in Alaska and Hawaii shall be considered as being within the Twelfth Federal Reserve District and shall make application to the Federal Reserve Bank of San Francisco. to the bank or trust company a Notice of Qualification Form PD 1959 (see appended exhibit B), establishing that it is qualified to make payments in connection with the redemption of the United States Savings Bonds hereinafter specified. If the application is not approved, the bank or trust company will be so advised in writing by the Federal Reserve Bank of the District. § 321.3 Termination of a bank's qualification to pay bonds. The Secretary of the Treasury or under authority of the Secretary the appropriate Federal Reserve Bank, as fiscal agent of the United States, may, by written notice, at any time and without previous demand or notice, terminate the qualification of any bank or trust company to pay United States Savings Bonds. A duly qualified bank or trust company may discontinue making payments at any time upon written notice to the Federal Reserve Bank, and its qualification shall thereupon cease. Subpart B-General § 321.4 Meaning of terms in this part. Hereinafter, for the purposes of this part, unless otherwise indicated specifically, or by context, the terms: (a) "Bank(s)" shall mean any eligible incorporated bank or trust company duly qualified pursuant to the provisions of this part to make payments in connection with the redemption of the United States Savings Bonds hereinafter specified, including such branches and facilities thereof located within the United States (including the territories and insular possessions of the United States and the Canal Zone) as it may desire to utilize for this purpose. The term "facilities," as used herein, is defined as those bank facilities at army and navy installations and at defense plants which have been established for the duration of the war with the specific approval of the Treasury Department. (b) "Bond(s)" shall include only United States Savings Bonds of Series A, B, C, D or E, including bonds of Series E designated "Defense Savings Bonds" or "War Savings Bonds." (Savings Bonds of Series F and G are not included.) (c) "Owner(s)" shall mean an individual (natural person) whose name is inscribed as an owner (or coowner) in his own right on a bond which is registered in any of the following forms: (1) In the name of a single individual in his own right, e. g. “John A. Jones"; (2) In the names of two individuals as coowners, e. g. "John A. Jones or Mrs. Ella S. Jones" (each is considered as an "owner," and payment may be made to either without the consent of the other); or (3) In the name of one individual, payable on death to another, e. g. "John A. Jones, payable on death to Mrs. Ella S. Jones," or "John A. Jones, p. o. d. Mrs. Ella S. Jones." (In this example, John A. Jones is the "owner" and Mrs. Ella S. Jones is the beneficiary. Payment under this part to a beneficiary is not authorized. (d) "Federal Reserve Bank" includes each Federal Reserve Bank and each Branch of a Federal Reserve Bank which has been or may hereafter be utilized by such Federal Reserve Bank to conduct any of the transactions in connection with which the term is used in this part. § 321.5 Reimbursement of banks' costs. A bank shall not make any charge against the owners of bonds for payments made hereunder. However, each bank shall be entitled to receive, for its service in paying bonds hereunder, reimbursement for bonds paid and forwarded to the Federal Reserve Bank each calendar quarter according to the following scale, which shall be applicable separately to each bank and each of its branches and facilities, if utilized, and if the bonds paid by each are separately scheduled and accounted for: 15 cents each for the first 1,000 bonds. 12 cents each for the second 1,000 bonds. 10 cents each for all over 2,000 bonds. The date such bonds are forwarded to the Federal Reserve Bank will govern the rate of reimbursement, and the payment of such amount as the bank is entitled to receive shall be made by the Federal Reserve Bank on behalf of the Treasury Department. § 321.6 Announcements, etc., of authority to pay bonds. Any announcement of or any reference to a bank's authority to pay savings bonds may be made only in a form or manner or contain such statements or substance as may be approved by the Secretary of the Treasury or, under authority of the Secretary, by the Federal Reserve Bank of the District, as fiscal agent of the United States. A bank shall not make such announcements or references unless and until it is officially qualified to pay bonds. Subpart C-Scope of Authority of Banks § 321.7 General. In order to protect the interests of the owners and to insure receipt by the proper persons of the proceeds thereof, savings bonds are registered, are not transferable, and are payable only to the owner named on the bond (except as otherwise specifically provided in the regulations governing the bonds). This policy must be understood and effectuated by each bank, notwithstanding the authority granted herein to make payments of bonds, since it is of the utmost importance that payment of the appropriate redemption value of the bonds be made to and received by only the persons entitled under the terms and conditions of the bonds and applicable regulations. § 321.8 Payments authorized. Subject to the terms of the bonds and to the provisions of the regulations governing them (Part 315 of this chapter) and the provisions of this part, a bank may make payment of any United States Savings Bond of Series A, B, C, D or E, to the individual (natural person) whose name is inscribed as the owner (or coowner) in his own right on the bond: Provided, That such individual presents the bond to the bank for payment and that the individual is known to the bank or establishes his identity to the complete satisfaction of the bank. This authority to make payments to the owner named on the bond will be held to include the following exceptional cases: (a) Where the name of the owner as inscribed on the bond has been changed by marriage and the bank knows or can establish to its complete satisfaction the identity of the owner whose name has been so changed. The signature to the request for payment should show both names, for example: "Miss Mary T. Jones, now by marriage Mrs. Mary J. Smith." A bank is not authorized to pay a bond for an owner whose name as inscribed on the bond has been changed in any other manner. (b) Where the name of the owner inscribed on the bond is that of a minor child who is not of sufficient competency and understanding to execute the request for payment and comprehend the nature of such act but upon whose be half request for payment is made by a parent with whom the child resides: Provided, however, That the form of registration does not indicate a guardian or similar representative of the estate of the minor owner has been appointed or is otherwise legally qualified. The parent requesting payment on behalf of the minor child must be known or his or her identity established to the complete satisfaction of the bank, and the parent must sign the request for payment in the form: "John A. Jones, on behalf of John C. Jones" and affix an endorsement in substantially the following form, which may be typed on the back of the bond: "I certify that I am the (father or mother) of John C. Jones and the person with whom he resides. He is years of age and is not of sufficient competency and understanding to sign the request.' Such a payment may not be made to any person other than a father or mother. § 321.9 Specific limitations of payment authority. A bank is not authorized hereunder to pay a bond: (a) If the bond is presented for payment prior to the expiration of 60 days from the issue date (the issue date should not be confused with the date appearing in the issuing agent's dating stamp). (b) If the bank does not know or can not establish to its complete satisfaction the identity of the person requesting payment as the owner of the bond (including the establishment of the identity of parents requesting payment on behalf of minor children, as set forth in § 321.8 (b)). (c) If the owner requesting payment (form for which appears on the back of each bond) does not sign his name in ink as it is inscribed on the face of the bond and show his home or business address. (See also §§ 321.8 (a) and (b) and 321.10 (d).) (d) If the bond appears to bear a material irregularity, for example, an altered, illegible, incomplete or unauthorized inscription, issue date or issuing agent's validating stamp impression; or if a bond appears to be altered, or is mutilated or defaced in such a manner as to create doubt or arouse suspicion with respect to the bond or any essential part thereof. (e) If the bond is marked "Duplicate.” (f) If Treasury Department regulations require the submission of documentary evidence to support the redemption of the bond, as in the case of deceased owners, incompetents or minors under legal guardianship or the change of an owner's name as inscribed on a bond if for any reason other than marriage. (g) If the owner named on the bond and requesting payment is a minor who, in the opinion of the bank, is not of sufficient competency and understanding to execute the request for payment and comprehend the nature of such act. (Note the authority granted to banks to make payments of bonds to either parent on behalf of a minor child under the provisions of § 321.8 (b).) (h) If it is known to the bank that the owner has been declared in accordance with law, incompetent to manage his estate. (i) If partial redemption is requested. Attention is directed to § 321.17 hereof for handling bonds of the foregoing classes of cases which may not be paid by banks. Subpart D-Payment and Accounting § 321.10 Examination of bonds presented for payment. Before making payment of bonds presented hereunder the bank: (a) Shall determine that the person requesting payment as the "owner" (as defined in this part) is known or his identity is established to the satisfaction of the bank. (b) Shall examine the bond and determine that it is a bond which the bank is authorized to pay under the provisions of this part. (c) If the request for payment on the back of the bond is already executed, shall determine that the request is properly signed by the registered owner presenting the bond and that his home or business address is shown. (d) If the request for payment on the back of the bond has not been executed or has been improperly executed by the owner presenting the bond, shall require such owner to properly sign the request and show his home or business address. § 321.11 Certification of requests for payment. In view of the provisions of this part governing payment of bonds and the requirements as to the data to be endorsed on each bond, under § 321.12, a bank will not be required in the case of any bond paid to it to complete the certification form at the end of the request for payment, nor determine the authenticity of any certification which may appear on the bond at the time it is presented for payment: Provided, however, That each bank submitting paid bonds shall be understood by such submission to have represented and certified that the identity of the owner requesting payment has been duly established to the satisfaction of the bank by one of its officers or by an employee duly authorized by the bank. § 321.12 Determination of redemption values and payment of bonds. The redemption value of a bond is determined from the period of time (years and full half-year) that it has been outstanding, and the table of redemption values on each bond. The Federal Reserve Bank of the district will furnish each bank with a table of redemption values from which it will be possible, after determining the month and year of issue of any bond, to immediately establish its current value. After establishing such value, payment thereof to the owner requesting payment shall be made in cash. No objection will be made to an arrangement between the owner and the bank under which the owner accepts in lieu of cash, a credit to his checking or savings account with the bank, or a check or similar instrument payable to his order. Each bank shall place on the face of each bond paid by it the word "Paid", the amount and date of payment and the name, location and transit (or code) number of the bank. Other data pertinent to the payment procedure of a bank may be included if approved by the Federal Reserve Bank of the District. The Federal Reserve Bank will furnish rubber stamps for this purpose or, in lieu thereof, will approve suitable stamps prepared by a bank. The affixation of such data shall be construed by and between the bank and the Treasury Department to be a certification by the paying bank that the bond has been paid in accordance with the terms and requirements of this part and that payment of the proceeds of the bond has been made to the owner. § 321.13 Forwarding paid bonds to the Federal Reserve Bank. After payment, the bonds shall be forwarded to the Federal Reserve Bank of the district in ac cordance with instructions issued by such Federal Reserve Bank. § 321.14 Redemption of paid bonds by Federal Reserve Banks. Upon receipt of the paid bonds the Federal Reserve Bank will make immediate settlement with the forwarding bank for the total amount of payments made on such bonds; however, such settlement shall be subject to adjustment if any discrepancies are discovered at a later date. § 321.15 Losses resulting from payments. Section 22 of the Second Liberty Bond Act, as amended, provides: (1) Any losses resulting from payments made in connection with the redemption of savings bonds shall be replaced out of the fund established by the Government Losses in Shipment Act, as amended, under such regulations1 as may be prescribed by the Secretary of the Treasury. The Treasurer of the United States, any Federal Reserve Bank, or any incorporated bank or trust company authorized or permitted to make payments in connection with the redemption of such bonds, shall be relieved from liability to the United States for such losses, upon a determination by the Secretary of the Treasury that such losses resulted from no fault or negligence on the part of the Treasurer, the Federal Reserve Bank, or the incorporated bank or trust company * . The pro visions of Section 3 of the Government Losses in Shipment Act, as amended, with respect to the finality of decisions by the Secretary of the Treasury shall apply to the determinations made pursuant to this subsection. (a) Consideration of facts concerning loss. In any case in which a loss occurs, the paying bank shall be afforded ample opportunity to present all of the facts pertaining to the circumstances of the payment for consideration by the Secretary. 'Regulations governing replacement of losses resulting from payments made in connection with the redemption of United States Savings Bonds are set forth in Part 322 of this chapter. 2 The provisions of section 3 of the Government Losses in Shipment Act, as amended, with respect to the finality of decisions by the Secretary of the Treasury are: "Notwithstanding any provision of law to the contrary, the decision of the Secretary of the Treasury that such loss, destruction, or damage has occurred or that such shipment was made substantially in accordance with such regulations shall be final and conclusive and shall not be subject to review by any other officer of the United States." § 321.16 Preservation of rights. Nothing contained in the regulations in this part shall be construed to limit or restrict any existing rights which holders of savings bonds may have acquired under the circulars offering such bonds for sale and the regulations prescribed thereunder. § 321.17 Redemption of bonds not payable by banks. Any bonds which a bank is not authorized to pay pursuant to the provisions of this part should be forwarded by the owner, or his agent, after certification of the requests for payment, to the Federal Reserve Bank or Branch of the District for redemption. If a bank should undertake to forward such unpaid bonds at the request and in behalf of the person entitled to payment, such bonds must be sent separate and apart from bonds which the bank has paid. Any documentary evidence required to support the redemption should accompany the bond or bonds when forwarded to the Federal Reserve Bank. § 321.18 Functions of Federal Reserve Banks. The Federal Reserve Banks, as fiscal agents of the United States, are authorized to perform such duties, and prepare and issue such forms and instructions, as may be necessary to the fulfillment of the purpose and requirements of this part. The Federal Reserve Banks, in their discretion, may utilize any or all of their branches in the performance of these duties. § 321.19 Supplements, amendments, etc. The Secretary of the Treasury may at any time or from time to time supplement, amend, or withdraw, in whole or in part, the provisions of this part, or of any amendments or supplements thereto, information as to which will be furnished promptly to the Federal Reserve Banks and to the banks qualified hereunder. Savings Bonds, as provided in the said Circular No. 750, and, upon being so qualified, hereby agrees: 1. To be bound by and to comply with the provisions of Treasury Department Circular No. 750, including all supplements and amendments thereof and instructions as may be issued thereunder. 2. That the Secretary of the Treasury, or the Federal Reserve Bank of by written notice, may, at any time, and without previous demand or notice, terminate the qualification of the undersigned, if such authority is granted pursuant to this application; and that in the event of such termination the undersigned, after receipt of such notice or after the date of termination specified therein, will not thereafter pay any United States Savings Bonds. It is understood that the undersigned may withdraw from this Agreement at any time upon written notice of such intention to the Federal Reserve Bank of IN WITNESS WHEREOF, the undersigned has caused this Agreement to be executed under seal by the officer below named, thereunto duly authorized by a resolution of its governing board or committee adopted on the 194... day of (Name of Institution) that the seal affixed to the above instrument is the corporate seal of said institution, and that the above instrument was signed and sealed in behalf of said institution by authority of its governing board or committee, and said officer acknowledged said instrument to be the free act and deed of said institution. Notary Public EXHIBIT B Form PD 1959 Treasury Department Το 194__. |