Section 9: Glossary

Abandonment: A process used by the Bureau of the Fiscal Service (Fiscal Service) to terminate the check reclamation because the financial institution's liability for the reclamation was deemed inappropriate.
Check reclamation: A procedure used by Fiscal Service to obtain a refund from a financial institution when a U.S. Treasury check is presented for payment over a forged or unauthorized endorsement.
Cumulative Notice of Discharged Debt: A monthly report that notifies the financial institution of any canceled debt that is reported to the Internal Revenue Service.
Direct Debit: A process that debits the financial institution's Federal Reserve master account for the full amount of the reclamation on the 31st calendar day provided the financial institution has not submitted a protest and has not paid the reclamation by an authorization before the 30th calendar day from the reclamation date.
Federal Agency: Any United States Federal Government agency.
Federal Reserve Bank: Serves as the nation's central bank. Functions include the handling of federal government deposits and checks; transferring funds through the Automated Clearing House network and Fedwire; and supervising and regulating federally chartered financial institutions.
FedMail: Fedmail is an application that receives large files for distribution via e-mail, Connect:Direct (C:D) or fax to financial institutions depending on how the financial institution prefers to receive the information.
Financial Institution: A bank, savings bank, savings and loan institution association, credit union or similar institution.
Master Account: The record of financial rights and obligations of an account holder and the Federal Reserve Bank with respect to each other, where opening, intraday, and closing balances are determined.
Offset: A collection method in which the federal government withholds funds payable by the United States to the financial institution and applies the withheld funds to a debt owed to the U.S. federal government. Fiscal Service may initiate an offset to collect a reclamation debt by referring the debt to the Treasury Offset Program or to another federal agency currently making payments to the presenting financial institution.; In addition, Fiscal Service may direct the Federal Reserve Bank to withhold credits from presenting financial institutions for application to a delinquent reclamation debt, a process known as Treasury Check Offset. Funds payable by the United States that may be offset include federal tax refunds, vendor payments, and credits from the Federal Reserve Bank for a Treasury check.
Presenting financial institution: A financial institution that directly presents checks to a Federal Reserve Bank and receives credit from the Federal Reserve for the check payment;

or

A depositary which is authorized to charge checks directly to Treasury's General Account and present them to the Department of the Treasury for payment through a designated Federal Reserve Bank.
Protest: A written statement to the Fiscal Service requesting a review of its decision that the financial institution is liable for a check reclamation. It raises a valid legal or factual question and includes any supporting documentation which proves the financial institution is not liable.
Reclamation Date: The date the Request for Refund (Check Reclamation) and/or the Notice of Direct Debit (U.S. Treasury Check Reclamation) was prepared.
Request for Refund (Check Reclamation) or Notice of Direct Debit (U.S. Treasury Check Reclamation): Initial notice sent to the presenting financial institution advising it of the amount due and the reason for the reclamation.
Summary of Debt Statement: A follow-up notice sent to the presenting financial institution listing their outstanding check reclamation debts.

Last modified 08/30/19