The Treasury Department’s Bureau of the Fiscal Service issued a proposed rule to amend its regulations governing the payment of checks drawn on the U.S. Treasury.
Proposed Rule: The bureau’s proposal would:
Require financial institutions to use the Treasury Check Verification System, or other similar authorized system, to verify that Treasury checks are authentic and valid.
Require Federal Reserve Banks to decline payment of a Treasury check to include prior cancellation of the check, so the Fiscal Service may place a “true stop” on Treasury checks.
Impact: The proposal is designed to prevent Treasury checks from being negotiated after cancellation by Treasury or a payment certifying agency, also known as payments over cancellation, or POC.
Deadline: Comments are due by April 3.