Thursday, May 23, 2024

Treasury Department issues final rule on paying canceled Treasury checks

A final rule will be enforced beginning Dec. 1 regarding financial institutions’ liability for paying canceled Treasury checks without waiting to receive the return information. The Treasury Department’s new processing system will now allow financial institutions to receive the return information quicker, which shares if the checks were canceled.

Consequently, the “reasonable efforts” currently protecting these financial institutions will change. These institutions can no longer make the checks’ funds available for withdrawal without proving the checks’ validity. The final rule will also limit financial institutions being held responsible for Treasury checks or fake checks.