TO THE OFFICER IN CHARGE OF SUPERVISION AT EACH FEDERAL RESERVE BANK
Recently, the Bureau of Public Debt (the "Bureau") of
the Department of the Treasury ("Treasury") alerted Board staff
concerning the potential misuse of one of its forms. The form--Form PD F 1832 ("Special Form of Detached Assignment for United
States Registered Securities")--is used primarily to certify
assignments of registered definitive Treasury securities.
According to the Bureau, the form is appropriately used
only at its direction or at the direction of a Federal Reserve
Bank, acting as Treasury's fiscal agent, in the following
circumstances:
The form may also be used, according to the Bureau, to
certify assignments of registered agency securities for those
agencies that have adopted the General Regulations Governing U.S.
Securities (31 C.F.R. 306) if authorized by the Bureau or a
Federal Reserve Bank.
The Bureau advised us that Form PD F 1832 has been used
in fraudulent efforts to convey interests in, or to transfer
ownership of, a security. Bureau staff also informed us that, in
many of these cases, the security, which was not delivered with
the form, was represented to be in bearer or book-entry form and
held at a depository or in a special account at Treasury.
Because the form is not intended for use without an accompanying
U.S. registered definitive security and cannot be used to assign
or establish an interest in book-entry or bearer securities,
these efforts have been illegal.
The Bureau is in the process of modifying Form
PD F 1832 so that it specifically and clearly states that the
form has no monetary value, does not evidence ownership of
securities, and will not support a transaction of any nature
unless it is accompanied by a security, unless the form relates
to a previously surrendered security.
Bureau staff has alerted the federal financial
institutions supervisory agencies and the self-regulatory
organizations for government securities broker-dealers, such as
the National Association of Securities Dealers and the New York
Stock Exchange, and the Fiscal Officers of each of the Federal
Reserve Banks about this matter. They would appreciate the
Federal Reserve Banks, in turn, now alerting the banking
organizations in their Districts about the potential fraudulent
misuse of the Bureau's form. To this end, we have prepared the
attached suggested notification letter that you can send to each
state member bank, bank holding company, and U.S. branch or
agency of a foreign bank in your District concerning this matter.
The Bureau asked that any questions concerning this
matter be directed to McKayla Braden, Director, Division of
Customer Services, Bureau of Public Debt, at (202) 874-1260. Ms. Susan Meyers at the Board ((202) 452-2781) has been
coordinating this matter with Bureau staff.
Deputy Director
ATTACHMENT TRANSMITTED ELECTRONICALLY BELOW
Dear __________________:
Recently, the Bureau of Public Debt (the "Bureau") of
the Department of the Treasury ("Treasury") alerted the staff of
the Division of Banking Supervision and Regulation of the Board
of Governors of the Federal Reserve System and the Fiscal Officer
of this Reserve Bank concerning the potential misuse of one of
its forms. The form--Form PD F 1832 ("Special Form of Detached
Assignment for United States Registered Securities")--is used
primarily to certify assignments of registered definitive
Treasury securities.
According to the Bureau, the form is appropriately used
only at its direction or at the direction of a Federal Reserve
Bank, acting as Treasury's fiscal agent, in the following
circumstances:
The form may also be used, according to the Bureau, to
certify assignments of registered agency securities for those
agencies that have adopted the General Regulations Governing U.S.
Securities (31 C.F.R. 306) if authorized by the Bureau or a
Federal Reserve Bank.
The Bureau advised the Federal Reserve that Form
PD F 1832 has been used in fraudulent efforts to convey interests
in, or to transfer ownership of, a security. Bureau staff also
informed this Reserve Bank that, in many of these cases, the
security, which was not delivered with the form, was represented
to be in bearer or book-entry form and held at a depository or in
a special account at Treasury. Because the form is not intended
for use without an accompanying U.S. registered definitive
security and cannot be used to assign or establish an interest in
book-entry or bearer securities, these efforts have been illegal,
and you should be alert to the inappropriate use of the form.
The Bureau is in the process of modifying Form
PD F 1832 so that it specifically and clearly states that the
form has no monetary value, does not evidence ownership of
securities, and will not support a transaction of any nature
unless it is accompanied by a security, unless the form relates
to a previously surrendered security.
The Bureau asked that any questions concerning this
matter be directed to McKayla Braden, Director, Division of
Customer Services, Bureau of Public Debt, at (202) 874-1260.
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