Effective April 11, 2012, the Federal Reserve Banks (“Reserve Banks”) are amending Operating Circular 3, Collection of Cash Items and Returned Checks, including its Appendix C, to support image-based processing of certain redeemed United States savings bonds and savings notes and to make other technical changes.  The effective date of the amendments coincides with the effective date of amendments to the United States Department of the Treasury Circular No. 750 (31 C.F.R. pt. 321).

Key changes that the Reserve Banks are making to Operating Circular 3 are set out below.

Body of Operating Circular 3

• The Reserve Banks are making a number of changes throughout the body of Operating Circular 3 to permit certain redeemed U.S. savings bond and savings notes to be submitted to Federal Reserve Processing Sites in image form.  These changes generally clarify that the Reserve Banks will handle redeemed U.S. savings bonds and savings notes as specified in the operating circular’s Appendix C and that those savings bonds and savings notes will be treated as cash items to the extent provided in that appendix. 

• The Reserve Banks are also amending paragraph 9.1 to specifically incorporate certain aspects of the Federal Reserve Policy on Payment System Risk. 

Appendix C to Operating Circular 3

• The Reserve Banks are adopting a new Appendix C to Operating Circular 3 to describe the terms under which the Reserve Banks process redeemed paper and imaged U.S. savings bonds and savings notes. 

• Among other things, Appendix C clarifies that the Federal Reserve Processing Sites will process images of redeemed Series EE savings bonds, Series I savings bonds, savings notes, and non–full-sheet Series E savings bonds.  Federal Reserve Processing Sites will not accept as images any redeemed facsimile U.S. savings bonds (i.e., paper copies of savings bonds that have been lost, damaged, or destroyed), savings bonds from other series, or full-sheet Series E savings bonds. 

• With respect to paper securities, Federal Reserve Processing Sites will process redeemed U.S. savings notes and Series A, B, C, D, E, EE, and I savings bonds.

Your continued use of the services offered under Operating Circular 3 after April 10, 2012, constitutes your agreement to the amended terms of the operating circular.

See the link below on the Federal Reserve Financial Services website for the official version of the amended operating circular.  To request a paper copy of any operating circular, contact your Customer Contact Center.

Operating Circulars