4 FAM 340
UNITED STATES TREASURY CHECKS
(CT:FIN-454; 08-07-2019)
(Office of Origin: CGFS/FPRA/FP)
4 FAM 341 GENERAL
4 FAM 341.1 Scope and Applicability
(CT:FIN-454; 08-07-2019)
a. Department of State personnel are designated by the
Treasury Department as United States Disbursing Officers authorized to obtain,
store, issue, report, verify, and cancel and reissue checks drawn on the U.S.
Treasury (Treasury). This subchapter prescribes the requirements and forms for
these operations with Treasury checks. The requirements apply to USDO
operations abroad and at Washington disbursing operations serviced by Treasury
Regional Financial Centers. Additional procedures related to Treasury checks
issued by overseas disbursing operations are contained in 4 FAH-2, Disbursing
Officer Handbook.
b. The requirements for depositary checks abroad appear
in 4 FAM 350,
U.S. Government Depositaries.
4 FAM 341.2 Authorities
(CT:FIN-454; 08-07-2019)
The authorities for this subchapter are as follows:
(1) 31 U.S.C. Chapters 33 and 35, General Authority to
Issue Checks and Other Drafts;
(2) Treasury Financial Manual, Volume 1, Part
4-Chapter 5000, Requisitioning, Preparing and Issuing Treasury Checks; Chapter
6000, Checking Accounts with the U.S. Treasury; and Chapter 7000,
Cancellations, Deposits and Claims for Checks Drawn on the U.S. Treasury;
(3) Public Law 100-86, Competitive Equality Banking
Act of 1987; and
(4) 31 CFR Parts 235, 240, 245, and 248.
4 FAM 341.3 Definitions
(CT:FIN-454; 08-07-2019)
Agency location code (ALC): A
3-digit (Regional Finance Centers), 4-digit (Non-Treasury disbursing offices),
or 8-digit (Treasury disbursing offices) identifier assigned by Treasurys
Bureau of the Fiscal Service (BFS) for reporting purposes.
Available check: A check that
has not been paid by Treasury and is in the possession of the certifying or
disbursing office.
Budget clearing account 19F3880:
A clearing account established by Treasury for recording and adjusting credits
and charges from the processing of claims on unavailable checks. ALC
administrators are responsible for expeditiously clearing credits and charges
in the Treasury account to the proper Department of State account.
Cancellation: The process of
rendering a check nonnegotiable after it has been issued and repaying the
amount of the check (whether available or unavailable) to an appropriation or
fund account.
Check status inquiry: Department
of State inquiry via the Treasury Check Information System (TCIS) concerning
the payment status or to obtain a copy of a U.S. Government check.
Check symbols: The symbol
numbers inscribed on the U.S. disbursing officer's (USDO) checks.
Chief disbursing officer (CDO):
Treasury official who directs disbursing operations performed by the Treasury
regional disbursing offices located throughout the United States.
Claimability: The length of
time a payee can present a claim of nonreceipt, loss, or theft of a U.S.
Government check.
Declined check: Any check
presented for payment that Treasury will not honor because of a prior notice of
a doubtful question of law or fact.
Disbursing officer (DO): An
employee of the Federal Government, a Treasury DO (TDO) or non-Treasury DO
(NTDO), authorized to perform financial transactions (deposit collections,
disburse checks, and transfer funds between agencies). NTDOs located overseas
also are referred to as USDOs and are authorized to disburse funds in both U.S.
dollars and in foreign currency.
Due or entitled: The condition
where the entire proceeds of a check are due and payable to a payee or the
payees estate.
Holder-in-due-course: An
individual who, in good faith, takes possession of a check through endorsement.
A claim to payment by a holder-in-due-course will be honored, even if the
original payee is not due or entitled to the check.
Limited payability cancellation:
The process by which Treasury automatically cancels a government check that
remains outstanding 12 months after the date of issuance.
Mutilated check: A check from
which large portions are missing. Such check is treated as unavailable
for cancellation purposes.
Nonreceipt: The payee alleges
a check of entitlement was not received and requests a replacement check.
Not due or not entitled: The
condition where all or part of the proceeds of a check are not due and payable
to the payee or the payees estate.
Original check: The initially
authorized physical check for which a claim of either nonreceipt, loss, theft,
destruction, or mutilation has been received.
Outstanding status: A check is
identified as outstanding when it has been reported as issued in TCIS but has
not yet been paid.
Paid status: A check
identified as paid that has been presented to the U.S. Treasury for payment
through the banking system.
Payability: The length of time
a U.S. Government check can be negotiated to a financial institution.
Recertified payment: A payment
of a new numbered (not a substitute) replacement check issued to a recipient
based on a claim of nonreceipt, loss, theft, destruction, or mutilation of an
original check. Such payments may be vouchered at the disbursing offices
discretion at any point prior to or during the claims process. The check will
be issued charging a valid Department of State appropriation.
Recovered check: A check
returned to the possession of a Department of State certifying or disbursing
officer after an unavailable check cancellation action has been taken.
Regional disbursing officer: Treasury
employees who serve as Directors of regional offices throughout the United
States and are authorized to disburse funds for other government agencies.
Status: The payment status of
an issued check, whether outstanding or paid, according to Treasury records.
Treasury check information system
(TCIS): TCIS records and reconciles U.S. Treasury payments and allows
users to get claim status on automated clearing house (ACH) payments.
Treasury Financial Manual (TFM):
The TFM is the Treasury's official publication of policies, procedures, and
instructions concerning financial management in the Federal Government.
Unavailable check: A U.S.
Treasury check not in the possession of a Department of State certifying or
disbursing officer.
Unavailable check action: The
action taken to:
(1) Determine the payment status of a check on which
subsequent action will be based; and
(2) Initiate retrieval of a check photocopy via TCIS
to obtain a copy of a check that has already been paid.
Undelivered check: A check
that is in the possession of either a Department of State certifying or
disbursing officer which has not been delivered to the payee.
4 FAM 341.4 Designation for
Disbursing
4 FAM 341.4-1 U.S. Disbursing
Officer (USDO)
(CT:FIN-454; 08-07-2019)
The Chief Disbursing Officer of the Treasury Department
delegates disbursing authority to the Department of State in accordance with 31
U.S.C. 3321. Department of State U.S. citizen employees are assigned to CGFS
Charleston or CGFS Bangkok and designated as a USDO by the Comptroller and
Assistant Secretary, CGFS.
4 FAM 341.4-2 Assistant USDO
Designation
(CT:FIN-454; 08-07-2019)
a. An assistant USDO may be designated and authorized
to draw checks on the Treasury in the name of the USDO for whom the
disbursements will be made.
b. The USDO, through the Director, Global Disbursing
Operations, can request the Comptroller and Assistant Secretary, CGFS, to
designate assistant USDOs. The assistant USDOs can act on behalf of the USDO
during the USDOs temporary absence or incapacity. Where circumstances
warrant, assistant USDOs can actively assist the USDO in managing daily
disbursing operations. Assistant USDOs perform the same duties and functions
as the USDO.
4 FAM 342 CONTROLS AND USE OF TREASURY
CHECKS
4 FAM 342.1 Management Controls
(CT:FIN-454; 08-07-2019)
This section is designed to comply with standards for a
system of internal control as required by the Federal Managers Financial
Integrity Act of 1982 (31 U.S.C. 3512(b)) and Competitive Equality Banking Act
of 1987, Public Law 100-86. Control over disbursing and accounting functions
as they relate to government check issuance and related activities must provide
for achieving the proper conduct of Department of State business, full
accountability for resources made available, and reviews to facilitate checks
and balances against waste, fraud or abuse. Operating procedures and
management control systems must reasonably ensure that the following objectives
are achieved:
(1) Appropriate organizational plans must be provided
to segregate functional responsibilities;
(2) Revenues and expenditures applicable to the
Departments financial operations must be properly recorded and accounted for
to permit the preparation of reliable financial and statistical reports;
(3) Sound accounting practices must be exercised in
the performance of duties; and
(4) Operational responsibilities must be commensurate
with personnel qualifications.
4 FAM 342.2 Use, Issuance and
Negotiability of Treasury Checks
4 FAM 342.2-1 Use of Treasury
Checks
(CT:FIN-454; 08-07-2019)
a. Treasury checks will be used to pay obligations of
the Department of State and serviced agencies; and to purchase U.S. dollars or
foreign currency for disbursing purposes when payment cannot be made via
electronic funds transfer. USDO checks will be drawn on the Treasurys General
account or on a designated depositary.
b. U.S. Treasury checks are prohibited from being sent
to a foreign country from the United States, when it is determined that postal,
transportation, or banking facilities do not reasonably ensure that the payee
will receive the check or be able to negotiate it for full value.
c. See 4 FAH-3
H-311.4 for the Departments policy on electronic funds transfer (EFT).
4 FAM 342.2-2 Issuance of
Treasury Checks
(CT:FIN-454; 08-07-2019)
a. Check issue payments will be made on the basis of a
certified voucher or Voucher and Schedule of Payments and carried-out in
accordance with the policies established herein. The over-all check issuance
process will be affected through use of management control procedures for
financial operations and must not be reliant on USDO functions or the review
and examination of vouchers.
b. U.S. Government checks carry the legend VOID AFTER 1
YEAR. The payee should return the expired check to the disbursing office that
authorized the payment.
4 FAM 342.2-3 Negotiability of
Treasury Checks
(CT:FIN-454; 08-07-2019)
All checks drawn on the Treasurer of the United States
must be negotiated within 12 months after the date of issue. Treasury cancels
U.S. Government checks that have not been negotiated 14 months after issue. Valid
claims against checks canceled by Treasury may be re-submitted for
certification and issuance of a check(s).
4 FAm 343 REQUISITIONING, PREPARING,
AND MAINTAINING TREASURY CHECKS
4 FAM 343.1 USDO Manual Signature
Specimens
(CT:FIN-454; 08-07-2019)
a. A newly designated USDO must forward specimens of
their manual signature to Treasury, BFS prior to issuing any U.S. Government
checks. A manual signature must show a reasonably uniform agreement with the
standard signatures on file with Treasury. Any USDO who elects to change the
form of their signature must submit new specimen signatures to Treasury, BFS.
b. A disbursing officer may designate an assistant
disbursing officer to sign checks drawn on Treasury in the name of the
disbursing officer. The disbursing officer forwards the original designation
form and specimens of the assistant disbursing officer's manual signature to
the agency official responsible for maintaining specimen signature files. An
assistant USDO's signature must appear below the printed, typed, or stamped
title of the disbursing officer for whom they are acting.
4 FAM 343.2 Facsimile Signatures
4 FAM 343.2-1 Authority for Use
(CT:FIN-454; 08-07-2019)
Where warranted, a USDO may request authority to use a
facsimile signature. The request must be regarded as including an assurance,
whether stated or not, that safeguards against unauthorized use of the
facsimile signature are provided. In addition, the USDO must submit two
certified and twelve plain specimen impressions from each signature plate for
approval to Treasury, BFS. A notice of approval from Treasury must be in the
USDOS possession before any of the facsimile plates are used to sign checks. The
plates must be numbered in sequence in the lower left corner beginning with the
number 1 unless another system of identification is approved by Treasury. Alternate
systems must assure control of the plates.
4 FAM 343.2-2 Internal Controls
Over Facsimile Signatures
(CT:FIN-454; 08-07-2019)
a. Signature dies for machine or hand stamps which have
become worn or have been withdrawn from service and which will not be used
again must be destroyed in accordance with 4 FAH-2
H-216.2. Upon destruction, a Certificate of Destruction must be prepared.
The certificate must be signed by two American U.S. Government employees who
witnessed the destruction. An impression of the signature die must be made on
the certificate prior to destruction. The original of the certificate must be
sent to CGFS/DO and one copy of the certificate must be retained in the files
of the USDO.
b. In the event a USDOS service is terminated due to
incapacitation or death, his or her successor must designate two American U.S.
Government employees to serve as witnesses to the destruction of the
predecessors signature die. The recommended methods of destruction include:
(1) Grinding the signature off by using a grinding
wheel;
(2) Pouring rubber solvent on the signature of the
die;
(3) Cutting or slicing the signature off the die with
a razor blade or knife and then burning or cutting the signature into smaller
pieces; or
(4) Removing the four screws from the die plate and
cutting the combination rubber/brass die plate into smaller pieces.
The destruction must be sufficient to ensure that
the die cannot be used for producing signatures. All signature dies, after
being mutilated, must be disposed of as waste matter.
c. Refer to 4 FAH-2
H-216.1 for safeguarding facilities for facsimile signature plates.
d. The discovery of any theft, lost or misuse of
facsimile signature plates must be promptly reported to the Office of Oversight
and Management Analysis Directorate (CGFS/OMA) and the Office of Inspector
General. CGFS/OMA must immediately notify the Treasury, BFS, Security Division,
stating the USDO symbol involved and complete details of the theft or loss; and
a request that payment be stopped on any USDO checks that may have been
compromised.
4 FAM 343.3 Blank Treasury Checks
4 FAM 343.3-1 Annual Estimate of
Requirements
(CT:FIN-454; 08-07-2019)
Each USDO submits an estimate of the number of blank U.S.
Treasury checks required for the next calendar year when the reorder point is
reached. The estimate is submitted utilizing U.S. GPO Form 2431, Print Order-Department
of the Treasury Paper Checks and Proofs, including the following:
(1) USDO disbursing account symbol;
(2) Number of checks used in each of the three
preceding months, i.e. January through March;
(3) Number of blank checks on hand; and
(4) The serial number of the highest numbered blank
check on hand.
4 FAM 343.3-2 Supplemental
Estimates
(CT:FIN-454; 08-07-2019)
The annual estimate of requirements for blank U.S.
Treasury checks should be sufficient. In the event of unforeseen developments
indicating the need for an additional supply of blank checks before the next
check shipment is expected, the USDO promptly forwards a supplemental estimate
of the additional requirements prepared in the same manner as the annual
estimate.
4 FAM 343.3-3 Receipt and
Acknowledgment of Shipments of Blank Treasury Checks by the USDO
(CT:FIN-454; 08-07-2019)
a. Upon receipt of a shipment of checks, the USDO
compares the markings on the unopened packages with the notice of shipment. If
no discrepancies are discovered, the receipt coupon provided with the notice is
signed and filed in the Treasury Check Stock folder. Any discrepancy noted is
reported immediately to Treasury, BFS.
b. Packages received with broken seals are promptly
verified by the USDO. After verification, the package is closed, resealed, and
the inclusive serial numbers of the checks found in the package indicated on
the outside of the package over the signatures of the USDO and the verifying
officer. Any discrepancies in the check serial numbers (or USDO disbursing
account symbol) disclosed by the verification are reported immediately to the
Chief Disbursing Officer, Treasury.
4 FAM 343.4 Custody and Control of
Check Stocks
(CT:FIN-454; 08-07-2019)
USDOs are responsible under the blanket bond for losses
arising from the theft or misuse of blank checks; therefore, precautionary
measures are prescribed for the custody and control of checks. The following
sections must be executed.
4 FAM 343.4-1 Custody of Check
Stocks
(CT:FIN-454; 08-07-2019)
a. Blank checks must be kept in a combination safe or
comparable depositary, as prescribed in 4 FAH-2 H-215.
b. Blank checks must be stored in sealed packages until
needed for use. Since checks are used in numerical sequence, only one package
should be opened at a time.
c. Blank checks are withdrawn from stock only by the
USDO or the designated USDO assigned check stock custodian.
4 FAM 343.4-2 Control of Check
Stocks
(CT:FIN-454; 08-07-2019)
a. The USDO must maintain a perpetual inventory record
of blank checks which reflects at all times the quantity (including serial
numbers) of checks in stock in sealed packages, and the quantity and serial
numbers of unwrapped checks on hand.
b. The inventory record must be verified by the USDO
each quarter. Verification must include a physical inventory of sealed
packages and unwrapped checks on hand. The verified checks inventory record
must be signed by the USDO after necessary adjustment of any errors.
c. If at any time after its receipt and initial
storage as provided in 4 FAM 343.3-3
an irregularity, such as a package of checks is found to have a broken seal,
the contents indicated on the wrapper must be promptly verified by the USDO and
one of the designated verifying officers. After verification, the package must
be closed and resealed until a determination of investigation is completed. The
inclusive numbers of the enclosed checks must be indicated on the package above
the signatures of the USDO and the verifying officer.
d. Upon a change of USDO, or upon the assumption of
responsibility by the assistant USDO for a period expected to exceed 1 month,
the two officers jointly verify the blank check inventory record.
e. The USDO must maintain the blank check inventory
records for authorized inspection at any time.
4 FAM 343.4-3 Missing Check
Stocks
(CT:FIN-454; 08-07-2019)
Any shortage, theft, or misuse of blank checks discovered
at any time is promptly reported to the Treasury, BFS, Security Division, at
(304) 480-7777. The Treasury should be provided with the check numbers and
USDO disbursing account symbol involved and request that payment be stopped. Complete
details of the shortage, theft, or misuse are then reported immediately to the
Department, Attention: Managing Director, Disbursing Operations, CGFS/DO.
4 FAM 343.5 Inscribing Treasury
Checks
(CT:FIN-454; 08-07-2019)
Efficient controls must be exercised over U.S. Treasury
checks while in the process of preparation. The controls must be designed for
protection against loss or theft, to prevent the release of imperfect checks
and for prompt disclosure of any discrepancy. Inscription machinery must be
selected upon the basis of its capability to draw checks.
4 FAM 343.6 Signature of USDO
(CT:FIN-454; 08-07-2019)
Each U.S. Treasury check issued by a USDO will bear
either:
(1) Manual signature;
(2) Approved facsimile signature; or
(3) Manual signature of an officially designated
assistant USDO.
4 FAM 344 ISSUING TREASURY CHECKS
4 FAM 344.1 Reporting Requirements
(CT:FIN-454; 08-07-2019)
USDOs must report their detailed check-issue transmittals
using Connect:Direct or on level 8 magnetic tape. Treasury's preferred method
of reporting is Connect:Direct. USDOs should report via magnetic tape only if
reporting via Connect:Direct is not possible (refer to disbursing users manual
for procedures).
4 FAM 344.2 Voided Checks
(CT:FIN-454; 08-07-2019)
a. All voided checks must be rendered nonnegotiable by
placing the legend VOIDNOT NEGOTIABLE, NO CHECK ISSUED UNDER THIS NUMBER on
the face of the checks.
b. The voided checks must be defaced and listed
according to symbol and from and to serial numbers. The listing of voided
checks must be reported to Treasury on Form SF-1179, Month End Check Issue
Summary, at the end of the issue month.
4 FAM 345 ENDORSEMENT AND PAYMENT OF
CHECKS
(CT:FIN-454; 08-07-2019)
The Treasury has the right of reasonable time for
examination of drawee checks presented, to refuse payment of refer doubtful
claims against checks to the Government Accountability Office for settlement. Checks
are deemed to be paid by Treasury only after the first fully completed
examination.
4 FAM 345.1 Endorsements
4 FAM 345.1-1 U.S. Government
Payee Endorsements
(CT:FIN-454; 08-07-2019)
The Federal Reserve Board regulates checks endorsement
standards in Regulation CC: Part 229 - Availability of Funds and Collection of
Checks. Additional Department check endorsement standards follow:
(1) Specific information must be included on stamps
used on the back of all checks deposited by Cashiers. For example;
PAY ANY BANK
USDO Symbol
Cashier Code Symbol
Embassy Name
Bank Name of Treasury General A/C;
(2) Payees depositing checks with Federal Reserve
Banks or commercial depositaries must utilize the endorsement area located 1.5
inches beginning at the trailing edge of the check; and
(3) The depositary bank will place its endorsement in
the area beginning 3.0 inches from the leading edge and ending 1.5 inches from
the trailing edge of the check.
4 FAM 345.1-2 Acceptable
Endorsement
(CT:FIN-454; 08-07-2019)
a. The only acceptable endorsement of a check by one
other than the payee is that the person endorsing is doing so on behalf of the
named payee. Such an endorsement will include the signature of the endorser
with sufficient wording indicating that the endorsement is on behalf of the
named payee.
b. Checks endorsed for collection or deposit only
to the credit of the named payee are acceptable without any signature. In the
absence of a signature, the presenting bank will be responsible for the
guarantee of such checks to all subsequent endorsers and to the Treasury.
4 FAM 345.1-3 Unacceptable
Endorsement
(CT:FIN-454; 08-07-2019)
Endorsements by other than the payee signature, regardless
of the relationship between the payee and endorser, must be presumed to be a
forgery and are unacceptable for payment by Treasury. It is the responsibility
of the individual or institution accepting a check from a person other than the
named payee to determine that such person is authorized and has the capacity to
endorse and negotiate the check. Treasury may require evidence of such claimed
activity in the event of a dispute.
4 FAM 345.1-4 Endorsement by
Financial Institutions
(CT:FIN-454; 08-07-2019)
a. U.S. Treasury checks endorsed by a payee and
received by a financial institution for credit to a specific account may be
endorsed CREDIT TO THE ACCOUNT OF THE WITHIN-NAMED PAYEE.
b. Financial institutions receiving and endorsing
checks must comply with the established Federal Reserve Board standards for
endorsement during the collection and return process (see 4 FAM 345.1-1).
4 FAM 345.2 Checks Issued to
Incompetent, Deceased or Minor Payees
4 FAM 345.2-1 Checks Issued to Incompetent
Payees
(CT:FIN-454; 08-07-2019)
U.S. Treasury checks endorsed by legal guardians for
persons declared incompetent must include a statement as to the capacity in
which they are endorsing the check. The checks will be paid by Treasury
without submission of documentary proof of authority. Treasury may require
evidence of such claimed authority to endorse in the event of a dispute.
4 FAM 345.2-2 Checks Issued to
Deceased Payees
(CT:FIN-454; 08-07-2019)
a. The right to payment of Treasury checks does not
terminate with the death of a payee when endorsed by an executor or
administrator. An indication of the capacity in which the executor or
administrator is endorsing must be included as part of the endorsement.
b. Treasury checks other than those issued in payment
for redemption of currencies, principal, or interest on U.S. securities, tax
refunds and for goods and services may not be negotiated after the death of the
payee. The checks are to be returned to the issuing disbursing office. A determination
must be made whether payment is due and to whom it may be made.
4 FAM 345.2-3 Checks Issued to
Minor Payees
(CT:FIN-454; 08-07-2019)
Checks issued to minors may be endorsed by either parent
with whom the minor resides; or, if the minor does not reside with either
parent, by the person who furnishes his chief support. The person endorsing on
behalf of the minor must present with the check, a signed statement indicating
the minors age, residence, means of chief support and that proceeds of the
check will be used for the minors benefit.
4 FAM 345.3 Power of Attorney
(CT:FIN-454; 08-07-2019)
U.S. Treasury checks endorsed by an attorney-in-fact must
include, as part of the endorsement, proof or indication to which the attorney
is endorsing. The checks will be paid by Treasury without the submission of
documentation of the claimed authority, with the understanding that evidence
may be required in the event of a dispute.
4 FAM 345.4 Guaranty of
Endorsements
(CT:FIN-454; 08-07-2019)
The bank and the endorser of a check presented to Treasury
for payment must guarantee that all endorsements are genuine. When the first
endorsement on the check has been made by one other than the payee, the
presenting bank and the endorser must guarantee to Treasury that the endorsing
person had authority to do so on behalf of the payee.
4 FAM 346 LIMITED PAYABILITY OF
GOVERNMENT CHECKS
4 FAM 346.1 Limited Payability
Proceeds
(CT:FIN-454; 08-07-2019)
a. Payees of U.S. Treasury checks have 1 year from the
date of issue to negotiate the check. Government checks that remain uncashed
after 12 months must be voided by Treasury and legally cannot be negotiated by
a financial institution. Treasury will automatically cancel all limited
payability checks 14 months after the issuance date.
b. The proceeds realized from worldwide limited
payability cancellations are placed in the budget clearing account F3880,
Unavailable Check Cancellations and Overpayments, and returned monthly by
Treasury, BFS via the Central Accounting Reporting System (CARS) to the Office
of the Managing Director, CGFS/F.
c. CGFS/F must maintain strict management controls and
accountability over limited payability proceeds. Managerial controls must
include reviews, reconciliations, and the dissemination of transactions by
Agency Location Code (ALC) and checking account symbol. Transactions are
forwarded to each benefiting disbursing operation for processing.
4 FAM 346.2 Processing Limited
Payability Transactions
(CT:FIN-454; 08-07-2019)
a. Within 30 days after receipt, benefiting disbursing
operations must identify and classify detailed transactions (credits). Limited
payability transactions are returned to the original appropriation and/or
allotment from which made. A subsequent reversing entry must be made to the
budget clearing account F3880.
b. Transactions (credits) which cannot immediately be
identified will remain in the appropriate budget clearing account identified by
ALC or checking account symbol.
c. Transactions which constitute valid liabilities
will be treated as accounts payable. Transactions identified as invalid
liabilities such as a duplicate payment will be deobligated immediately, and
funds made available to the applicable appropriation or returned to surplus
under normal year-end procedures.
d. Transactions identified as valid liabilities and a
claim not presented within 5 years from the date of a check will be returned to
Treasury through submission of the Year-end Closing Statement. Claims
presented after the funds have been returned must be restored through the
normal restoration process.
e. The validity of an available or unavailable check
claim by a payee must be exercised through examination of the payment records
to determine whether an earlier claim or check cancellation was processed. When
examination of the records is inconclusive, a request for Treasury check status
inquiry must be used to support payment or nonpayment of cancellation claims.
4 FAM 346.3 Management Controls
(CT:FIN-454; 08-07-2019)
a. Accounting managers must determine the efficiency
and effectiveness with which proceeds from limited payability check
cancellations are applied to appropriated and nonappropriated funds, and payee
claims are processed against the proceeds. Findings must be appraised and
utilized for the purpose of refining and improving procedures or internal
control features of limited payability and claimability of U.S. Treasury check
procedures.
b. Managers of the budget clearing account F3880 are
responsible for an ongoing transaction analysis to determine the status of
limited payability proceeds. Action must be initiated to clear balances that
have been held in the accounts for more than 1 year. Unidentified limited
payability transactions (credits) which remain in the budget clearing account
F3880 for more than 1 year must be transferred to Treasury account 20X6133,
Payment of Unclaimed Moneys.
4 FAM 346.4 Treasury Charges
(CT:FIN-454; 08-07-2019)
a. The Departments ALCs will be charged by Treasury
for:
(1) Copy/information retrieval;
(2) Computer processing activities related to
archiving and retrieval;
(3) A percentage of the overall check payments and
reconciliation processing;
(4) Microfilm production;
(5) Postage fees; and
(6) Record storage.
Anticipated costs will be determined and billed by
Treasury at the end of each fiscal year, and the costs will be based on the
volume of requests.
b. Costs for record storage charges must be billed on a
fiscal year basis. Copy retrieval costs must be billed quarterly. Charges for
copy requests must be re-evaluated at the end of the third quarter of each
fiscal year and will be based on the number of requests processed during the
current fiscal year. Treasury will advise the Department on the copy request
charge for the following fiscal year with the third-quarter billing statement.
4 FAM 346.5 Forgery and Fraud
4 FAM 346.5-1 Forgery and Fraud
Referral
(CT:FIN-454; 08-07-2019)
a. The United States Secret Service will perform an
investigation on a case-by-case basis when forgery or fraud is indicated. A
single case referral must total more than $25,000 in forged or fraudulent
issued checks. Cases which cannot be handled according to TFM, Volume 1, Part
4, Section 8070, may be referred by a USDO to the Secret Service, 1800 G Street,
NW, Washington, DC 20223, for investigation.
b. Valid claims or replacement checks are paid in
accordance with TFM, Volume 1, Part 4, Section 8070.
4 FAM 346.5-2 Check Forgery
Insurance Fund
(CT:FIN-454; 08-07-2019)
a. The Treasury, in accordance with TFM, Volume 1, Part
4, Section 8070, must pay from the Check Forgery Insurance Fund to a payee or
special endorsee of a check drawn on a depositary designated by Treasury, the
amount of the check without interest if:
(1) The check was lost or stolen through no fault of
the payee;
(2) The check was negotiated and paid by Treasury on a
forged endorsement; or
(3) The payee was not involved in any part of the
proceeds of the check negotiation or payment.
b. Treasury is responsible for depositing to the credit
of the Check Forgery Insurance Fund any amount recovered from a forger.
4 FAM 346.5-3 Limitation on
Reclamation Actions and Claims (Fraud)
(CT:FIN-454; 08-07-2019)
U.S. Treasury checks paid over a forged or unauthorized
endorsement may be reclaimed from the presenting bank or any other endorser
that has breached its guarantee prior to:
(1) The end of the 1-year period beginning on the date
of payment; or
(2) The expiration of the 180-day period beginning on
the close of the 1-year period.
4 FAM 346.5-4 Processing
Government Checks
(CT:FIN-454; 08-07-2019)
a. Federal Reserve Banks may cash Treasury checks drawn
on the order of USDOs. USDO checks are not refused for payment unless they
have been altered or forged.
b. Each Federal Reserve Bank will charge the amount of
checks cashed to the account of the Treasury. Any check that Treasury refuses
to pay will be photocopied and returned to the Federal Reserve Bank. A
reversal of the previously charged amount must be credited to Treasurys
account for the refused payment.
c. Banks located outside of the United States which
are designated as depositaries and permitted to charge checks to Treasurys
General Account are governed by operating instructions contained in a letter of
authorization issued by the Treasury. Depositaries are responsible for
assuming the obligation of presenting banks.
4 FAM 346.5-5 Collection for
Unauthorized Endorsements
(CT:FIN-454; 08-07-2019)
a. A check paid by Treasury and later found to bear an
unauthorized endorsement must be refunded by the presenting bank. Treasury
will have the right to recover interest and other applicable charges such as
administrative collection costs and late payment penalties that may be
authorized or required by law.
b. Treasury will issue an initial demand for refund of
the amount of a check payment by sending a Request for Refund Reclamation to
the presenting bank. The request will advise the presenting bank of the
amount and the reason for the demand.
c. A protest of Treasurys demand for refund, by the
presenting bank, must be received in Treasury no later than 90 days after the
reclamation date. Collection action will be delayed while the protest is being
considered. If Treasury accepts the protest, the presenting bank must be notified
in writing that efforts to collect the item and any accrued interest have been
abandoned.
d. Presenting banks will be notified in writing, of
insufficient evidence in the protest. Treasury requires the presenting bank to
bear liability for the amount of the demand. If the demanded amount is not
paid by the presenting bank within 30 days of the date of decision, Treasury
will proceed to collect the amount owed by offset.
e. Treasury will promptly refund any amount offset to a
banking institution when it has been determined that the bank was not liable
for an unauthorized endorsement.
4 FAM 347 CANCELING, DEPOSITING AND
CLAIMS FOR U.S. GOVERNMENT CHECKS
4 FAM 347.1 Cancellation of Checks
4 FAM 347.1-1 Cancellation of
Available Checks
(CT:FIN-454; 08-07-2019)
a. All available checks whether due or not due the
payee or the payees estate, must automatically be canceled by the USDO within
24 hours of receipt.
b. The following legend should be inscribed on the face
of the check(s) to be canceled: NOT NEGOTIABLEFor payment and credit in the
U.S. Treasury Account, Checking Account Symbol XXXX.
c. Available checks which are in the possession of a
USDO must be canceled within 24 hours of receipt. Form SF-1098, Schedule of
Canceled or Undelivered Checks, will be used to initiate the cancellation.
4 FAM 347.1-2 Cancellation of
Unavailable Checks
(CT:FIN-454; 08-07-2019)
a. USDOs will take immediate steps to stop payment by
means of TCIS on any check that has been issued but is unavailable when it is
learned that the payee or payees estate is not entitled to all, or part of the
proceeds of the check. The USDO must ascertain the disposition of the check
and issue a notice to the payee or payees estate that such checks are not to
be negotiated but returned to the USDO for proper handling.
b. A valid claim against any part of the proceeds owed
a payee or payees estate may be rescheduled and a new check issued. A copy of
any check paid prior to the recording of the stop payment, will be forwarded to
the USDO by Treasury.
c. The following steps will be taken when checks are
presented for payment after the request for stop payment has been received and
the stop entered by Treasury:
(1) Treasury will decline payment if the payee is
deceased; and
(2) If it becomes necessary that Treasury honor a
claim of a holder-in-due-course, the check will be paid and the credit that was
allowed when the check was previously treated as canceled will be reversed by
means of FMS 3858, Claims Document. Payments over cancellation are reported
via IPAC.
4 FAM 347.2 Nonreceipt or Loss
(CT:FIN-454; 08-07-2019)
A payee of nonreceipt, loss, or a mutilated check drawn on
the Treasury will immediately notify the USDO or FMC and request that payment
be stopped. If the check is determined to be outstanding, the claimant will be
issued a substitute check.
4 FAM 347.2-1 Substitute Checks
(CT:FIN-454; 08-07-2019)
a. A substitute check issued in lieu of lost, stolen,
or mutilation must not be canceled and deposited as the original check. A
substitute check which is returned because the original has been reported
recovered by the payee should be stamped with the legend NOT
NEGOTIABLEORIGINAL RECOVERED and together with any correspondence are
forwarded for removal of stop payment on the original check to the CDO,
Treasury.
b. Substitute checks returned to Treasury for reasons
other than the recovery of the original check by the payee will be stamped with
the legend NOT NEGOTIATEDUNDELIVERED. This group of substitute checks
should be separately packaged, from those being forwarded for the purpose of
removing stop payment on the original checks, and sent to the Treasury, BFS.
4 FAM 347.2-2 Recovered Checks
(CT:FIN-454; 08-07-2019)
a. Checks recovered subsequent to treatment as unavailable
cancellations or returned to the possession of the USDO succeeding submission
of Unavailable Check Cancellation must not be canceled, deposited or released
to the payee.
b. Checks for which Form SF-1184, Unavailable Check
Cancellation, was previously submitted, are to be stamped NONNEGOTIABLE,
PREVIOUSLY TREATED AS CANCELED. The date of the previous Form SF-1184 must be
forwarded to Treasury along with the checks.
4 FAM 347.2-3 Request for Stop
Payment
(CT:FIN-454; 08-07-2019)
The USDO must access TCIS for the purpose of placing
stoppage of payment when a claim of nonreceipt, loss, theft, destruction, or
mutilation of a check is received.
4 FAM 347.3 Depositing, Accounting
and Reporting for Canceled Checks Proceeds
4 FAM 347.3-1 Depositing Canceled
Checks
(CT:FIN-454; 08-07-2019)
Checks held may be transmitted to the depositary covered
by Form SF-215, Deposit Ticket. The deposit ticket must have a confirmed date.
Deposits must be made in advance of the close of the month to facilitate their
being taken into accounts in the same month as the deposit. Canceled
miscellaneous payment checks issued by Treasury must be deposited at the
earliest date a workable volume is on hand, but not prior to the issue date of
the checks. Check cancellations for which immediate credit has been requested
must be deposited immediately.
4 FAM 347.3-2 Accounting and
Reporting for Canceled Checks
(CT:FIN-454; 08-07-2019)
a. Accounting transactions for canceled checks
associated with Washington-held allotment programs must be reported as
reductions in disbursements on the monthly Statement of Transactions
(Classified According To Appropriation, Fund and Receipt Account, and Related
Control Totals). Treasury control totals disbursements report, will be reduced
by the amount of the deposits.
b. The USDO will report applicable transactions as
confirmed deposits on the monthly Statement of Accountability (Foreign Service
Account) and as reductions in disbursements on the monthly Statement of
Transactions According To Appropriations, Funds, and Receipt Accounts (Foreign
Service Account). Refer to disbursing users manual for operating procedures.
4 FAM 347.3-3 Proceeds from
Canceled Checks
(CT:FIN-454; 08-07-2019)
a. Canceled check proceeds will be returned to the
account originally charged or the appropriate successor account. A check
related to annual, multi-year and no-year appropriations will be treated as an
account payable. An invalid liability would be available to the account or
returned to surplus under normal year-end procedures. Proceeds from a check
which constitute a valid liability, but a claim has not been presented within 5
years from the date of issue, must be returned to Treasury through the Year-end
Closing Statement. Funds must be restored through the restoration process when
a claim is placed after the proceeds of a check are returned.
b. The Department will be responsible for initiating
action to clear balances that have been held in uninvested trust, revolving and
deposit fund accounts for more than 1 year for transfer to account 20X6133. Such
balances must meet all four of the following criteria:
(1) Amount is $25.00 or more;
(2) A refund upon claim would be justified;
(3) There is no doubt as to the legal ownership of the
funds; and
(4) A named individual, business, or other entity can
be identified with the item.
c. Invested accounts will retain funds from canceled
checks on their books. All records necessary to recertify any payment on an
obligation represented by a canceled check must be retained by the disbursing
office.
d. Proceeds returned due to check cancellation may not
be used to create new obligations except where the liability is determined not
valid. The use of the funds must be in strict compliance with laws governing
appropriated funds.
4 FAM 348 UNDELIVERED U.S. TREASURY
CHECKS
(CT:FIN-454; 08-07-2019)
The following procedures are to be followed when the
Department is granted a waiver to cancel undelivered checks and will:
(1) Facilitate the safekeeping of the checks;
(2) Place the amounts of the checks under appropriate
accounting control at the earliest practicable date; and
(3) Eliminate the checks as continuing payables in
USDO accounts.
4 FAM 348.1 Request for Waiver
4 FAM 348.1-1 Safekeeping Undelivered
Checks
(CT:FIN-454; 08-07-2019)
Each disbursing operation must prescribe procedures to be
observed for the safekeeping of checks returned as undelivered. Checks must be
kept in a locked combination safe while in the custody of the USDO.
4 FAM 348.1-2 Time Limit for
Holding Undelivered Checks
(CT:FIN-454; 08-07-2019)
a. Undelivered checks may be held a maximum of 6 months
after the month of issue. An earlier disposition is operationally beneficial
to the USDO and Treasury for check payment and checking account reconciliation.
Undelivered checks should be deposited as soon as practicable. Deposits must
be made in time to be confirmed and recorded in the same accounting month that
the disbursing activity is to be reported. Undelivered checks for which no
action has been taken to authorize disposition within the time limit will be
deposited by Treasury, for credit to the Departments 8-digit ALC or 4-digit
disbursing account symbol.
b. Undelivered checks returned to Treasury without a claim,
will be forwarded within 5 days after receipt to the appropriate USDO for
disposition. The benefiting USDO should determine whether the proceeds of the
check are due or not due the payee or the payees estate.
4 FAM 348.2 Schedule of Canceled or
Undelivered Checks
(CT:FIN-454; 08-07-2019)
a. Form SF-1098 must be used to schedule canceled or
undelivered checks, the proceeds of which are due and payable to the payee or
payees estate. The proceeds must be credited to the appropriation or fund
account from which they were originally certified. If the account cannot be
determined, the credit should be made to F3875 Budgetary Clearing and Suspense
Account until the determination can be made.
b. Liability will be established immediately in the
accounting records for the amount of all undelivered checks credited in order
to provide for the possible subsequent payment to the payees or their estates
upon claim for the proceeds. This liability represents an unpaid
obligation. Either Form SF-1098 or the regular formal documentation may
be used to establish the obligation and payable in the accounts.
4 FAM 348.3 Undelivered Check
Claims
4 FAM 348.3-1 Claims for
Undelivered Checks Not Automatically Canceled
(CT:FIN-454; 08-07-2019)
Undelivered checks which are returned to the USDO or
Treasury and are determined to be due and payable to the payee, or the payees
estate or guardian, are subject to claims for their proceeds. Claims may be
received prior to the return of the check, with the returned check, while the
check is being held by the USDO, or at any future date.
4 FAM 348.3-2 Claims for Proceeds
of Undelivered Checks
(CT:FIN-454; 08-07-2019)
Valid claims for the proceeds of undelivered checks which
have been credited to the Departments accounts must be recertified for
payment.
4 FAM 348.3-3 Claims Involving
Deceased or Incompetent Payees
(CT:FIN-454; 08-07-2019)
a. Undelivered checks submitted to a disbursing office
in connection with a claim for the proceeds which are due a deceased payee or an
estate, or an incompetent individual, must be scheduled for deposit and applied
as a credit to the appropriation or fund account originally charged; and at the
same time, establishing a liability for payment.
b. Claims involving deceased civilian or military
personnel of the Government and deceased or incompetent public creditors as
well as claims involving doubtful questions of law or fact must be settled by
the U.S. Government Accountability Office.
4 FAM 348.4 Vouchering Claims for
Proceeds of Undelivered Checks
(CT:FIN-454; 08-07-2019)
In processing claims for the proceeds of undelivered
checks which have been credited to Departmental accounts, the payment must be
supported by a regular disbursement voucher signed by an authorized certifying
officer.
4 FAM 349 RECORD OF CHECKS DEPOSITED
4 FAM 349.1 Endorsement and Legend
4 FAM 349.1-1 Depositors
Endorsement on Checks Deposited
(CT:FIN-454; 08-07-2019)
a. Endorsements by depositors of checks, including
checks drawn to the order of Treasury, for deposit with the Federal Reserve
banks and general depositaries for credit in the account of Treasury should
include:
(1) The USDO disbursing account symbol number, or the
Agency Location Code (ALC);
(2) The words, FOR CREDIT TO THE U.S. TREASURY; and
(3) The date of endorsement.
b. Depositors must show in the endorsement on checks
the same ALC as shown on Form SF-215.
c. When depositors can determine from other records
the date each check is deposited, the date in the endorsement may be
eliminated. Such endorsement in form or content changes, for any reason, must
first be approved by Treasury.
4 FAM 349.1-2 Legend Placed on
Checks Scheduled for Deposit
(CT:FIN-454; 08-07-2019)
The back of each undelivered check scheduled for deposit
will be stamped Deposit to ALC xxx before any action is taken to deposit the
checks.
4 FAM 349.2 Check Deposits
4 FAM 349.2-1 Federal Reserve
Bank Deposits
(CT:FIN-454; 08-07-2019)
a. Checks deposited with a Federal Reserve Bank need
not be sorted but must be accompanied by an adding machine tape or other
listing showing the item amounts and deposit total. The Federal Reserve Bank
will credit Treasurys General Account on the date of the deposit if the items
are received early enough to be processed that day. Department of State
depositors must establish a schedule allowing the deposits to reach the Federal
Reserve Banks before the daily deadline for Government agency deposits.
b. Treasury checks exceeding $5,000 must be deposited
with the nearest Federal Reserve Bank. Form SF-215 must be prepared and
transmitted with the checks.
4 FAM 349.2-2 Depositing Canceled
Available and Undelivered Checks
(CT:FIN-454; 08-07-2019)
Available and undelivered U.S. Treasury checks which have
been scheduled for cancellation or deposit on Form SF-1098 are classified as
repayments and should not be included in deposits of other classes of
collection items.