NATIONAL BANKING UNDER THE FEDERAL RESERVE SYSTEM
shall by such action be deemed (a) to authorize the Federal Reserve
Banks to handle such checks subject to the following terms and con-
ditions, (b) to warrant its own authority to give the Federal Reserve
Banks such authority, and (c) to agree to indemnify any Federal
Reserve bank for any loss resulting from the failure of such sending
bank to have such authority.
|—A Federal Reserve Bank will act only as agent of the bank from which it
receives such checks and will assume no liability except for its own negligence
and its guaranty of prior indorsements.
2—A Federal Reserve Bank may present such checks for payment or send such
checks for collection direct to the bank on which they are drawn or at which
they are payable, or in its discretion may forward them to another agent
with authority to present them for payment or send them for collection
direct to the bank on which they are drawn or at which they are payable.
2.
—A Federal Reserve Bank may in its discretion and at its option, either
directly or through an agent, accept either cash or bank drafts in payment
of or in remittance for such checks and shall not be held liable for any loss
resulting from the acceptance of bank drafts in lieu of cash, nor for the failure
of the drawee bank or any agent to remit for such checks, nor for the non-
payment of any bank draft accepted in payment or as a remittance from the
drawee bank or any agent.
i- Checks received by a Federal Reserve Bank on its member or nonmember
clearing banks will ordinarily be forwarded or presented direct to such banks,
and such banks will be required to remit or pay therefor at par in cash or
bank draft acceptable to the collecting Federal Reserve Bank, or at the
option of such Federal Reserve Bank to authorize such Federal Reserve
Bank to charge their reserve accounts or clearing accounts; provided, how-
ever, that any Federal Reserve Bank may reserve the right in its check col-
lection circular to charge such items to the reserve account or clearing account
of any such bank at any time when in any particular case the Federal Re-
serve Bank deems it necessary to do so.
5-
Checks received by a Federal Reserve Bank payable in other districts will
be forwarded for collection upon the terms and conditions herein provided
to the Federal Reserve Bank of the district in which such checks are payable.
6—The amount of any check for which payment in actually and finally collected
funds is not received shall be charged back to the forwarding bank, regardless
of whether or not the check itself can be returned.
Each Federal Reserve Bank shall also promulgate rules and regula-
tions not inconsistent with the terms of the law or of this regulation,
governing the details of its check clearing and collection operations.
[RO 1
