DVP - Take the Money Order Image to your bank and ask them if it was processed

[David Josephs]

So I guess a follow up question is, that's how it works now, but has it always been the same? At least back to 1962?

Know any 75 year old bank tellers?

Drew - the processing of paper checks and money orders in 1962 would be no different than any other time...

1st National credits Klein's account if there is a deposit
1st National is now owed $21.45 from the USPS as an account receivable
1st National sends the endorsed and processed check to the Fed
The Fed now credits 1st National their $21.45 and is owed that amount from the issuer - the USPS
The FED now batch processes these checks (electronically if possible but if old style punch card type PMO they treat it as "mutilated" - see below)
The FRB now sends the check to the USPS which shows it has been processed and paid thru the FRBS. The money given to the USPS at the time of purchase is now transfered to the Fed and all acounts are now square.

1963 was not the middle ages. Business still kept records and processes still were used by the Federal Reserve Banks to keep track of their paperwork.
REA who shipped the pistol and charged $1.27 does not seem to have ever rec'd it given what Hidell paid. There is a COD charge but no FOB express charges collect (shipping charge.)






How would the postmaster know where to go to collect a refund if none of the banks involved did not identify themsleves on the money order?

"The postmaster general has the right to demand refund from the presenting bank of the amount of a paid money order if, after payment, the money order is found to be stolen, or to have a forged or unauthorized endorsement, or to contain any material defect or alteration not discovered on examination"

I truly do not see this as a matter of time but one of basic record keeping


7030.60 -Bank No. or FRB Code (Appendix No. 1 ). This term refers to the four digits of the FRB routing symbol. This number is to be used on various documents for charging or shipping of money orders to USPS.

Chapter7000 http://tfm.fiscal.treasury.gov/v2/p4/c700.html[/FONT]
PROCEDURES FOR PROCESSINGPOSTAL MONEY ORDERS

Appendix B Processing Postal Money Orders

· Purchaser of the PMOdesignate a "Payee" and fills out the purchaser's information
· Purchaser pays for thePMO Postal clerk tears PMO from stub and hands to Purchaser
· Purchaser provides PMOto designated Payee for deposit in exchange for goods/services
· Payee endorses the backof the PMO and deposits PMO in their Bank
· The Bank will thenPROCESS the PMO, adding whatever marks, electronic or otherwise to the back ofthe PMO and record the payment to Payee in their records
o The Bank, now the new Payee, forwardsthe PMO to their affiliated Federal Reserve Bank for reimbursement offunds and processing
USPS Fed Res Sys process


3.0 Federal Reserve System
3.1General
All money orders are forwardedthrough the Federal Reserve Banking System, to which commercial banks haveaccess.
3.2Payment
The postmaster general has theusual right of a drawee to examine money orders presented for payment by banksthrough the Federal Reserve System and to refuse payment of money orders, andhas a reasonable time after presentation to make each examination. Provisionalcredit is given to the Federal Reserve Bank when it furnishes the money ordersfor payment by the postmaster general. Money orders are deemed paid only afterexamination is completed, subject to the postmaster general's right to makereclamation under 3.4.
3.3Endorsement
The presenting bank and theendorser of a money order presented for payment are deemed to guarantee to thepostmaster general that all prior endorsements are genuine, whether an expressguarantee to that effect is placed on the money order. When an endorsement ismade by a person other than the payee personally, the presenting bank and theendorser are deemed to guarantee to the postmaster general, in addition toother warranties, that the person who so endorsed had capacity and authority toendorse the money order for the payee.
3.4Reclamation
The postmaster general has theright to demand refund from the presenting bank of the amount of a paid moneyorder if, after payment, the money order is found to be stolen, or to have aforged or unauthorized endorsement, or to contain any material defect oralteration not discovered on examination. Such right includes, but is notlimited to, the right to make reclamation of the amount by which a genuinemoney order with a proper and authorized endorsement has been raised. Suchright must be exercised within a reasonable time after the postmaster generaldiscovers that the money order is stolen, bears a forged or unauthorizedendorsement, or is otherwise defective. If refund is not made by the presentingbank within 60 days after demand, the postmaster general takes such actions asmay be necessary to protect the interests of the United States.

1. The Federal Reserve Bank will record the transaction and also includemarkings on the back of the PMO in accordance to their batch processing rules.
a. Today, the Federal Reserve Banking System (FRBS) processes everything electronically yet fairlyrecently the paper products themselves were sent through Batch Processingmachines. Section 7040 of Chapter 7000 of the "Procedures for ProcessingPostal Money Orders" tells us:
i. Section 7040 -Processing Fit Money Orders
7030.25 -Fit Money Order. A money order that can becompletely processed on high speed processing equipment.
· Batching and ListingFit Money Orders. Paper money orders are MICR printed with the routing code(including a routing number of 0000-0020 or 000000204) and the serial numberwith check digit. The routing number is also preprinted in the upper rightcorner on the form, which is in the location and front as prescribed by theABA.

FRBs will process FIT money orders as follows:
· Receive money ordersfrom banks and process on high speed equipment in the manner most compatiblewith the processing of other categories of cash items.
· Prepare batches of nomore than 500 items.
· Insert (in numericalsequence) USPS batch Locator Control Documents so that one is filed at the beginning of each batch of money orders to beread.
· Create apaper-tape list of serial numbers with optionalcheck digit and amount of each money order read. The list will show the batch number and a subtotal for each batch with anoverall total of all money orders listed on the paper tape.
· The total amount of fititems should be entered on PS Form 1901, code 100.
· Money orders bearingunreadable MICR characters in the on-us field are not to be rejected andhandled as mutilated. List the characters that can be read on the paper tape asa reconcilement aid.
i. Section 7040 & 7050 (Manual process)
[FONT=Symbol]· 7050.20 -Insert a USPSBatch Locator Control Document at the beginning of each batch of mutilatedmoney orders.
· 7050.30 -Prepare anadding machine listing of each batch showing the following information:
a. FRB name or code at the top.
b. The amount of each item.
c. The total amount of the batch.
d. FRB clearance date.
e. Batch number
ii. Section 7070 - Processing Old Style Money Orders
· "Punchcard" money orders that have the ABArouting number 0000-0119 will be handled as mutilated items. They should beidentified as old style "punch card" money orders on the PS Form 1901for code 004

7030.60 -Bank No. or FRB Code (Appendix No. 1 ). This term refers tothe four digits of the FRB routing symbol. Thisnumber is to be used on various documents for chargingor shipping of money orders to USPS.

Section7035 -Charges For Postal Money Orders

The FRBswill prepare SF 5515, "Debit Voucher," for 8-digit accounting stationcode or agency location code (ALC) 18-00-0005 to charge postal money ordersbased on cash letters or other deposit documents received that haveaccompanying postal money order documents. After machine classification ismade, in order to correct any amount undercharged for money orders made on theoriginal charge of the SF 5515, another SF 5515 will be prepared and processed.If an overcharge is made on the original SF 5515, the FRB will process an SF215 "Deposit Ticket" for the amount overcharged to ALC 18-00-0005.Appendix No. 1 provides instructions and the distribution of the SF's 5515 and215. The net amount of all debit vouchers and deposit tickets reported to ALC18-00-0005 must be shown on the FRBs Daily Balance Wire to BGFO on line 14-A.This amount is reconciled to the confirmed copies of the debit vouchers anddeposit tickets received at MOD, St. Louis, Missouri.

PS Form 1901"Advice of Classification for Postal Money Orders" is basically areconciliation form prepared by the FRB. Certain data from the SF's 5515 or 215(confirmed date, document, number, and amount) will be. shown under the blocktitled "Charge to ALC 18-00-0005." This amount must agree with thetotal for the block titled "Classification of Postal Money Orders"which reflects the description, code, number of items, and amount of the postalmoney orders being shipped. The money order documents will be shipped to MOD,St. Louis, Missouri. Adjustments of errors made on previous shipments will alsobe reported under the "Classification of Postal Money Orders" blockand supported by completing the "Schedule of Adjustments Entered UnderCode 003" shown at the bottom of the PS Form 1901 (Appendix No. 1). NOCOPIES OF THE PS FORM 1901 WILL BE SENT TO TREASURY.

Each PS Form1901 is accountable to USPS, therefore, if the FRB voids a PS Form 1901, sendall copies to:

Postal DataCenter
ProcessingControl Division
Attn:Accounting Section
P.O. Box14431
St. Louis,MO 63180

These voidedcopies should not be included with the shipment of money orders. If the PS Form1901 is destroyed, Processing and Control Division, Accounting Section, shouldbe advised in writing.

Section 7040-Processing Fit Money Orders

Batching andListing Fit Money Orders. Paper money orders are MICR printed with the routingcode (including a routing number of 0000-0020 or 000000204) and the serialnumber with check digit. The routing number is also preprinted in the upperright corner on the form, which is in the location and front as prescribed bythe ABA. FRBs will process FIT money orders as follows:
â– Receive money orders from banks andprocess on high speed equipment in the manner most compatible with theprocessing of other categories of cash items.

â– Prepare batches of no more than 500items.

â– Insert (in numerical sequence) USPSbatch Locator Control Documents so that one is filed at the beginning of eachbatch of money orders to be read.

â– Create a paper-tape list of serialnumbers with optional check digit and amount of each money order read. The listwill show the batch number and a subtotal for each batch with an overall totalof all money orders listed on the paper tape.

â– The total amount of fit items shouldbe entered on PS Form 1901, code 100.

â– Money orders bearing unreadable MICRcharacters in the on-us field are not to be rejected and handled as mutilated. List the characters that can beread on the paper tape as a reconcilement aid.

7040.10-Preparation of Recapitulation of Batch Totals. Prepare a PS Form 1175(Appendix No. 1) or equivalent machine produced summary daily for the batchesprocessed and listed on the paper tapes. Enter each batch number, item count,and total separately. The DAILY TOTAL line of the PS Form 1175 must equal codes100 and 110 on the PS Form 1901. Submit a separate PS Form 1175 to support code400 of "Dom. Intl" on the PS Form 1901.

7040.20-Adjustments Between Amounts Charged and Money Orders Listed. The total amountof the PS Forms 1175 should agree with the amount classified on the PS Form1901. If the total amount of the PS Form 1175 is larger than the amount shownon the PS Form 1901, prepare another SF 5515 for the NET AMOUNT OF THEDIFFERENCE and process for ALC 18-00-0005. Whenever the total amount of the PSForm 1175 is less, prepare an SF 215 for ALC 18-00-0005 and process for the NETAMOUNT OF THE DIFFERENCE. These documents will be functioned on the dailytranscript and listed on the PS Form 1901.

7040.30-Shipping Money Orders. Instructions for shipping money orders to MOD are asfollows.
â– Place batches of money orders,including the USPS Batch Locator Control Documents in shipping boxes. Maintainthe money orders and batches in the same sequence as they were read and listedon the paper tape list.

â– Mail the original PS Form 1901 to:

Postal DataCenter
ProcessingControl Division
Attn:Accounting Section
P.O. Box14431
St. Louis,MO 63180
â– Attach the last three copies of PSForm 1901, to the PS Form 1175 or machine equivalent and place all documents inthe last box of money orders for that day.

â– Place the paper tape list and themutilated tapes in the same box.

â– Batches of mutilated money orders maybe included in the same box or in the same shipment as fit money orders,provided the batches of mutilated money orders are clearly identified asmutilated.

â– Place a completed box label on thefront of each box. The boxes should bear sequential numbers on the labels(e.g., "Box 2 of 4") to facilitate USPS processing.

â– When justified by the number of boxesshipped, the boxes may be in the larger No. 5 box shipping carton.

â– Place the boxes and cartons in mailpouches for delivery to the USPS representatives. Due to the limited space availableon the pouch label, the mailing address on the label should read as follows:

St. LouisMissouri 63182
MOD P.O. Box14963
From:F.R.B. (City)

Shipmentwill be made to the MOD by registered mail using pouches with rotary locksprovided by the USPS.

7050 -Processing Mutilated Money Orders

This sectionrelates to the handling of mutilated paper money orders with ABA routingnumbers 0000-0020 or 000000204.

7050.10-Mutilated paper money orders must be grouped in batches not to exceed 200documents in a batch. If the total number of mutilated items does not exceed200, they may be handled as one batch. For larger quantities, make as manybatches as necessary, not exceeding 200 in any one batch.

7050.20-Insert a USPS Batch Locator Control Document at the beginning of each batch ofmutilated money orders.

7050.30-Prepare an adding machine listing of each batch showing the followinginformation:
â– FRB name or code at the top.

â– The amount of each item.

â– The total amount of the batch.

â– FRB clearance date.

â– Batch number.

7050.40-Batches of the paper money orders that cannot be machine processed withoutfirst being MICR amount encoded may be delivered to the USPS representativewithout processing, provided the above requirements are essentially met.

7050.50 -The total amount of mutilated items should be entered on the PS Form 1901, code110.

Section 7060- Detection Of Stolen Or Raised Money Orders

FRBs are notrequired to institute regular routing procedures for the detection of stolen orraised money orders. However, each FRB will cooperate, in specialcircumstances, to aid USPS representatives in the detection of these items.

Section 7065- Adjustment of Errors

Adjustmentof errors and charges by the FRB will be made by using SF 5515 for ALC 18-00-0005,and PS Form 1176 "Schedule of Differences in Money Order Clearances".(Appendix No. 1). All charges or credits accepted will be identified by theFRB, itemizing the schedule number, as indicated on PS Form I 1 76, and amounton the PS Form 1901 for code 003.

Section 7070- Processing Old Style Money Orders

"Punchcard" money orders that have the ABA routing number 0000-0119 will behandled as mutilated items. They should be identified as old style "punchcard" money orders on the PS Form 1901 for code 004.

Section 7075-Processing Domestic International Money Orders (Semi-Domestic)

Canadianmoney orders, ABA routing number 0000-0127, and Canal Zone money orders, ABArouting number 0000-0800, can be mechanically processed; all others must be processedmanually. The batch size of Canadian money orders cannot exceed 200 documents.Money orders of different countries cannot be intermingled; each country mustbe batched separately. The total of all domestic-international money ordersshould be shown under code 400 on the PS Form 1901.

Section 7080-Other Procedural Matters

7080.10-Postal Service Reimbursement to FRBs. The Postal Service has agreed toreimburse the FRBs for services provided in processing postal money ordersbeyond the level of service provided to financial institutions paying cashitems. Charges will be determined by an annual survey, according to FederalReserve and U.S. Postal Service agreements, and will be billed monthly with asingle bill for each Federal Reserve District submitted to the Money OrderDivision, and will be paid at the end of each 6 months. The Postal Servicereserves the right to review and challenge the method used in calculating thesecharges