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Electronic Fund Transfers, National Commission on
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4520526
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Electronic Fund Transfers, National Commission on
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Philip W. Buchen Files
Philip Buchen's General Subject Files
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The original documents are located in Box 12, folder "Electronic Fund Transfers, National
Commission on" of the Philip Buchen Files at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald R. Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 12 of the Philip Buchen Files at the Gerald R. Ford Presidential Library
Tuesday 12/3/74
9:34 Charlie Joyce called concerning the National Commission on
Electronic Funds Transfer, which was established by a
bill (H. R. 11221), which the President signed on October 28.
(See attached note of previous call from George Glaser,
which Charlie took care of for us.)
Charlie has never received a letter from Glaser, which
Glaser said he would be writing to the President, with a copy
to you and a copy to Charlie Joyce.
Charlie has had calls from many computer people to ask how
to make inputs. He doesn't know what to tell them or who
to contact.
I checked again with our Records section, and they now have
copies of the bill, which they will send over.
(Copy now attached)
FORG i LIBRARY GERALD
Glaser
George
Tuesday 11/12/74
4:10 Returned George Glaser's call of yesterday to Mr. Buchen.
(415) 342-4133
Mr. Glaser is the President of AFIPS
He said they had seen the recent announcement of the Presidential
commission National on electronic funds transfer. (about a week ago)
(Now a Commission on electronic fund transfers. The AFIPS
Board of Directors discussed this the other day; they have a fund
transfer project and are in touch with the Federal Reserve. The
Board passed a resolution urging the President to include in appointments
by the President to this Commission one or more technical persons.
There is no one designated now for the Commission who comes from a
computer related agency. There are however five positions on the
Commission to be appointed as representatives of the private sector. He said:
"We were hoping that we could urge the President to put someone who knows about
computers on the Commission." I suggested possibly writing a letter to
Mr. Buchen -- and suggested I would check with Charlie Joyce first.
Checked vi th Charlie Joyce and he is familiar with the bill and would
talk with Mr. Glaser if he called. Said there is indeed a bill --
H. R. 11221, an act to increase deposit insurance to establish
-----
electronic fund transfers.
Wasn't sure it was signed.
Called Jerry Jones' office who said the bill was signed by the President
on October 28.
Checked with Tom Jones for a copy; they advise GPO is more than a
week behind on printing so it may be another week before we get a copy.
Gave Charlie Joyce the bill number and the date of signing; he said
he would talk to Glaser. Glaser talked with him and will write a
letter to the President, witha copy to Mr. Buchen and Mr. Joyce.
When Glaser comes to town within the near future, he will meet
with Mr. Joyce.
-RALD LIBRER e FORD
Public Law 93-495
93rd Congress, H. R. 11221
October 28, 1974
An Act
To increase deposit insurance from $20,000 to $40,000, to provide full insurance
for public unit deposits of $100,000 per account, to establish a National
Commission on Electronic Fund Transfers, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
Federal deposit
insurance, in-
TITLE I-AMENDMENTS TO AND EXTENSIONS OF PRO-
crease.
VISIONS OF LAW RELATING TO FEDERAL REGULA-
TION OF DEPOSITORY INSTITUTIONS
FULL DEPOSIT INSURANCE FOR PUBLIC UNITS
SECTION 101. (a) The Federal Deposit Insurance Act is amended- 12 USC 1811
(1) in subsection (m) of section 3 (12 U.S.C. 1813 (m)), by note.
inserting immediately after "depositor" in the first sentence the
following: (other than a depositor referred to in the third sen-
tence of this subsection)";
(2) in subsection (i) of section 7 (12 U.S.C. 1817 (i)), by strik-
ing out "Trust" and inserting in lieu thereof the following:
"Except with respect to trust funds which are owned by a deposi-
tor referred to in paragraph (2) of section 11 (a) of this Act, Infra.
trust"; and
(3) in subsection (a) of section 11 (12 U.S.C. 1821 (a)), by
inserting "(1)" immediately after "(a)", by striking out "The"
in the last sentence and inserting in lieu thereof the following:
"Except as provided in paragraph (2), the", and by inserting at
the end of such subsection the following:
(2) (A) Not withstanding any limitation in this Act or in any other Insured banks,
provision of law relating to the amount of deposit insurance available public funds in,
for the account of any one depositor, in the case of a depositor who is—
coverage
"(i) an officer, employee, or agent of the United States having
official custody of public funds and lawfully investing or deposit-
ing the same in time and savings deposits in an insured bank;
7 (ii) an officer, employee, or agent of any State of the United
States, or of any county, municipality, or political subdivision
thereof having official custody of public funds and lawfully
investing or depositing the same in time and savings deposits in
an insured bank in such State;
(iiii) an officer, employee, or agent of the District of Columbia
having official custody of public funds and lawfully investing or
depositing the same in time and savings deposits in an insured
bank in the District of Columbia; or
"(iv) an officer, employee, or agent of the Commonwealth of
Puerto Rico, of the Virgin Islands, of American Samoa, or of
Guam, or of any county, municipality, or political subdivision
thereof having official custody of public funds and lawfully invest-
ing or depositing the same in time and savings deposits in an
insured bank in the Commonwealth of Puerto Rico, the Virgin
Islands, American Samoa, or Guam, respectively:
88 STAT. 1500
his deposit shall be insured in an amount not to exceed $100,000 per 88 STAT. 1501
account.
(b) The Corporation may limit the aggregate amount of funds that
may be invested or deposited in time and savings deposits in any
insured bank by any depositor referred to in subparagraph (A) of
this paragraph on the basis of the size of any such bank in terms of its
41-616 O (2:9)
Pub. Law 93-495
- 2
October 28, 1974
October 28, 1974
- 3 -
Pub. Law 93-495
88 STAT. 1502
assets: Provided, however, such limitation may be exceeded by the
investing the same in a credit union insured in accordance with
pledging of acceptable securities to the depositor referred to in sub-
this title in such State;
paragraph (A) of this paragraph when and where required."
"(iii) an officer, employee, or agent of the District of Columbia
Savings and
(b) Title IV of the National Housing Act is amended-
loan associa-
having official custody of public funds and lawfully investing the
tions, public
(1) in section 401(b) (12 U.S.C. 1724(b)), by striking out
same in a credit union insured in accordance with this title in the
funds in, DOV-
"Funds" in the third sentence and inserting in lieu thereof the
District of Columbia; or
erage.
following: "Except in the case of an insured member referred to
"(iv) an officer, employee, or agent of the Commonwealth of
in the preceding sentence, funds";
Puerto Rico, of the Panama Canal Zone, or of any territory or
(2) in section 405 (a) (12 U.S.C. 1728(a)), by inserting after
possession of the United States, or of any county, municipality,
"except that no member or investor" the following: (other than
or political subdivision thereof having official custody of public
a member or investor referred to in subsection (d)) and
funds and lawfully investing the same in a credit union insured
(3) by adding at the end of section 405 (12 U.S.C. 1728) the
in accordance with this title in the Commonwealth of Puerto Rico,
following new subsection:
the Panama Canal Zone, or any such territory or possession,
(d) (1) Notwithstanding any limitation in this subchapter or in
respectively;
any other provision of law relating to the amount of deposit insurance
his account shall be insured in an amount not to exceed $100,000 per
available for any one account, in the case of an insured member who
account.
is-
"(B) The Administrator may limit the aggregate amount of funds
"(i) an officer, employee, or agent of the United States having
that may be invested or deposited in any credit union insured in
official custody of public funds and lawfully investing the same
accordance with this title by any depositor or member referred to in
in an insured institution;
subparagraph (A) on the basis of the size of any such credit union
"(ii) an officer, employee, or agent of any State of the United
in terms of its assets."
States, or of any county, municipality, or political subdivision
(d) Section 107(7) of the Federal Credit Union Act (12 U.S.C.
thereof having official custody of public funds and lawfully
1757 (7)) is amended by adding at the end thereof the following:
investing the same in an insured institution in such State;
"and to receive from an officer, employee, or agent of those nonmember
(iii) an officer, employee, or agent of the District of Columbia
units of Federal, State, or local governments and political subdivisions
having official custody of public funds and lawfully investing the
thereof enumerated in section 207 of this Act (12 U.S.C. 1787) and
same in an insured institution in the District of Columbia; or
in the manner SO prescribed payments on shares, share certificates, and
"(iv) an officer, employee, or agent of the Commonwealth of
share deposits;".
Puerto Rico, or of the Virgin Islands, or of any county, munici-
(e) Section (b) (2) of the Home Owners' Loan Act of 1933 is 12 USC 1464.
pality, or political subdivision thereof having official custody of
amended by inserting immediately after "security," "may be surety as
public funds and lawfully investing the same in an insured insti-
defined by the Board".
tution in the Commonwealth of Puerto Rico or the Virgin Islands,
(f) (1) The Advisory Commission on Intergovernmental Relations
Study.
respectively;
(hereinafter referred to as the "Commission") shall conduct a study
42 USC 4275
the account of such insured member shall be insured in an amount not
of the impact of this section on funds available for housing and on
note.
to exceed $100,000 per account.
State and local bond markets.
"(2) The Corporation may limit the aggregate amount of funds
(2) The Commission shall make a report to the Congress of the Report
to
that may be invested in any insured institution by any insured mem-
results of its study not later than two years after the date of enactment
Congress.
ber referred to in paragraph (1) of this subsection on the basis of the
of this Act.
size of any such institution in terms of its assets."
(3) There is authorized to be appropriated to the Commission such
Credit unions,
(c) Subsection (c) of section 207 of the Federal Credit Union Act
sums as may be necessary to carry out this subsection.
public funds
(12 U.S.C. 1787) is amended by-
(g) This section and the amendments made by it shall take effect 12
USC
1813
in, coverage.
(1) inserting "(1)" after "(c)",
on the thirtieth day beginning after the date of enactment of this Act. note.
(2) striking out "For the purposes of this subsection," and
inserting in lieu thereof the following: "Subject to the provisions
INCREASED CEILING ON DEPOSIT INSURANCE: FEDERAL DEPOSIT INSURANCE
of paragraph (2), for the purposes of this subsection,", and
CORPORATION
(3) adding at the end thereof the following:
(2) (A) Notwithstanding any limitation in this Act or in any
SEC. 102. (a) The following provisions of the Federal Deposit Insur-
other provision of law relating to the amount of insurance available
ance Act are amended by striking out "$20,000" each place it appears
for the account of any one depositor or member, in the case of a
therein and inserting in lieu thereof "$40,000":
depositor or member who is-
(1) The first sentence of section (m) (12 U.S.C. 1813
"(i) an officer, employee, or agent of the United States having
(2) The first sentence of section 7(i) (12 U.S.C. 1817
official custody of public funds and lawfully investing the same
(3) The last sentence of section 11(a) (12 U.S.C. 1821 (a)
in a credit union insured in accordance with this title;
(4) The fifth sentence of section 11(i) (12 U.S.C. 1821
88 STAT. 1501
(ii) an officer, employee, or agent of any State of the United
(b) The amendments made by this section are not applicable to 12 USC 1813
88 STAT. 1502
States, or of any county, municipality, or political subdivision
any claim arising out of the closing of a bank prior to the effective note.
thereof having official custody of public funds and lawfully
date of this section.
(c) The amendments made by this section shall take effect on the Effective date.
thirtieth day beginning after the date of enactment of this Act.
12 USC 1813
note.
Pub. Law 93-495
- 4 -
October 28, 1974
October 28, 1974
- 5 -
Pub. Law 93-495
88 STAT. 1504
88 STAT. 1503
INCREASED CEILING ON DEPOSIT INSURANCE: FEDERAL SAVINGS AND LOAN
Commission under sections 12, 13, 14(a), 14(c), 14(d), 14(f) and 16, 15 USC 781,
INSURANCE CORPORATION
unless they find that implementation of substantially similar regula-
78m, 78n, 78p.
SEC. 103. (a) The following provisions of title IV of the National
tions with respect to insured banks and insured institutions are not
Housing Act are amended by striking out "$20,000" each place it
necessary or appropriate in the public interest or for protection of
12 USC 1724.
investors, and publish such findings, and the detailed reasons therefor,
Publication in
appears therein and inserting in lieu thereof "$40,000":
in the Federal Register. Such regulations of the above-named agencies,
Federal Regis-
(1) Section 401 (b) (12 U.S.C. 1724(b)).
or the reasons for failure to publish such substantially similar regula-
ter.
(2) Section (12 U.S.C. 1728(a)).
tions to those of the Commission, shall be published in the Federal
12 USC 1724
(b) The amendments made by this section are not applicable to
note.
Register within 120 days of the date of enactment of this subsection,
any claim arising out of a default, as defined in section 401 (d) of the
and, thereafter, within 60 days of any changes made by the Com-
National Housing Act, where the appointment of a conservator,
mission in its relevant regulations and rules."
receiver, or other legal custodian as set forth in that section becomes
(c) Paragraph (5) of subsection (1) of section 407 of the National
effective prior to the effective date of this section.
(c) The amendments made by this section shall take effect on the
Housing Act, as amended (12 U.S.C. 1730(1) (5)), is amended by
Effective date.
12 USC 1724
inserting after "disclosures" a comma and the following: "including
thirtieth day beginning after the date of enactment of this Act.
note.
proxy statements and the solicitation of proxies thereby,".
(d) Subsection (j) of section 402 of the National Housing Act, as
INCREASED CEILING ON DEPOSIT INSURANCE: INSURED CREDIT UNIONS
amended (12 U.S.C. 1725(j)), is amended to read as follows:
SEC. 104. (a) The first sentence of section 207 (c) of title II of the
"(j) (1) Except as otherwise provided in this subsection, until
Federal Credit Union Act (12 U.S.C. 1787 (c)) is amended by strik-
June 30, 1976, the Corporation shall not approve, under regulations
ing out "$20,000" and inserting in lieu thereof "$40,000".
adopted pursuant to this title or section 5 of the Home Owners' Loan
12 USC 1787
(b) The amendment made by this section is not applicable to any
Act of 1933, by order or otherwise, a conversion from the mutual to
12 USC 1464.
note.
claim arising out of the closing of a credit union for liquidation on
stock form of organization involving or to involve an insured insti-
account of bankruptcy or insolvency pursuant to section 207 of title II
tution, except that this sentence shall not be deemed to limit now or
of the Federal Credit Union Act (12 U.S.C. 1787) prior to the effective
hereafter the authority of the Corporation to approve conversions in
date of this section.
supervisory cases. The Corporation may by rule, regulation, or other-
Effective date.
(c) The amendment made by this section shall take effect on the
wise and under such civil penalties (which may be cumulative to any
12 USC 1787
thirtieth day beginning after the date of enactment of this Act.
other remedies) as it may prescribe take whatever action it deems
note.
necessary or appropriate to implement or enforce this subsection.
CONVERSION OF SAVINGS AND LOAN ASSOCIATIONS
(2) The number of applications for conversion which the Corpora-
tion may approve pursuant to such regulations prior to such date
SEC. 105. (a) Section 403(b) of the National Housing Act, as
shall be determined by the Corporation but shall not in any case
amended (12 U.S.C. 1726(b)), is amended by adding at the end
be in excess of 1 per centum of the total number of all insured institu-
"Reserves."
thereof the following new sentence: 'As used in this subsection the term
tions in existence on the date of enactment, exclusive of the number
'reserves' shall, to such extent as the Corporation may provide, include
of applications submitted for filing prior to May 22, 1973. Provided,
capital stock and other items, as defined by the Corporation.".
that the Corporation shall process to final determination any applica-
(b) Section 12(i) of the Securities Exchange Act of 1934, as
tion submitted for filing prior to May 22, 1973, pursuant to regulations
amended (15 U.S.C. is amended to read as follows:
in effect and adopted pursuant to this title or section 5 of the Home
"(i) In respect of any securities issued by banks the deposits of
Owners' Loan Act of 1933: with further proviso that, with respect
which are insured in accordance with the Federal Deposit Insurance
to a plan of conversion of any such applicant which, before May 22,
12 USC 1811
Act or institutions the accounts of which are insured by the Federal
1973, has given written public notice to its accountholders of adoption
note.
Savings and Loan Insurance Corporation, the powers, functions, and
of a plan of conversion or has obtained waiver forms from substan-
duties vested in the Commission to administer and enforce sections 12,
tially all its new accountholders subsequent to the giving of such
15 USC 781,
13, 14(a), 14(c), 14(d), 14(f), and 16, (1) with respect to national
notice, such plan need not require payment for stock distributed to
78m, 78n, 78p.
banks and banks operating under the Code of Law for the District
accountholders as of a record date prior to the date of such notice.
of Columbia are vested in the Comptroller of the Currency, (2) with
"(3) Notwithstanding any other provision of law, an insured insti-
respect to all other member banks of the Federal Reserve System are
tution converting in accordance with this subsection may retain its
vested in the Board of Governors of the Federal Reserve System,
Federal charter. The Corporation shall not, however, permit the
(3) with respect to all other insured banks are vested in the Federal
conversion of Federally chartered associations in States the laws of
Deposit Insurance Corporation, and (4) with respect to institutions
which do not authorize the operation of State chartered stock associa-
the accounts of which are insured by the Federal Savings and Loan
tions, except that the prohibition contained in this sentence shall not
Insurance Corporation are vested in the Federal Home Loan Bank
apply to the District of Columbia, the Commonwealth of Puerto Rico,
Board. The Comptroller of the Currency, the Board of Governors of
or a State where all insured institutions domiciled therein are Fed-
the Federal Reserve System, the Federal Deposit Insurance Corpora-
erally chartered.
tion, and the Federal Home Loan Bank Board shall have the power
"(4) Any aggrieved person may obtain review of a final action of
to make such rules and regulations as may be necessary for the execu-
the Federal Home Loan Bank Board or the Corporation which
tion of the functions vested in them as provided in this subsection.
approves, with or without conditions, or disapproves a plan of con-
In carrying out their responsibilities under this subsection, the
version pursuant to this subsection only by complying with the pro-
agencies named in the first sentence of this subsection shall issue sub-
visions of subsection (k) of section 408 of this title (12 U.S.C.
stantially similar regulations to regulations and rules issued by the
1730a (k)) within the time limit and in the manner therein prescribed,
Pub. Law 93-495
- 6 -
October 28, 1974
October 28, 1974
- 7 -
Pub. Law 93-495
88 STAT. 1505
88 STAT. 1506
which provisions shall apply in all respects as if such final action were
SUPERVISORY AUTHORITY OF THE BOARD OF GOVERNORS OF THE FEDERAL
Publication in
an order the review of which is therein provided for, except that such
RESERVE SYSTEM OVER BANK HOLDING COMPANIES AND THEIR NON-
Federal Regis-
time limit shall commence upon publication of notice of such final
BANKING SUBSIDIARIES
ter.
action in the Federal Register or upon the giving of such general
notice of such final action as is required by or approved under regula-
SEC. 110. Subsection (b) of section 8 of the Federal Deposit Insur-
tions of the Corporation, whichever is later.
ance Act, as amended (12 U.S.C. 1818 is amended by adding at the
Reports to
"(5) The Corporation shall, at least annually and more often as
end thereof the following new paragraph:
Congress.
circumstances require, render reports to the Congress on the exercise
(3) This subsection and subsections (c), (d), (h), (i), (k), (1),
of its authority under this subsection.
(m), and (n) of this section shall apply to any bank holding company,
"(6) In implementing the provisions of this subsection the Corpora-
and to any subsidiary (other than a bank) of a holding company, as
tion shall regulate the approvals granted SO as to achieve (A) as much
those terms are defined in the Bank Holding Company Act of 1956, in
12 USC 1841
geographical dispersion as practicable; (B) an equitable distribution
the same manner as they apply to a State member insured bank."
note.
with respect to the size of converting institutions; (C) an appropriate
distribution between State chartered and Federally chartered institu-
INDEPENDENCE OF FINANCIAL REGULATORY AGENCIES
tions; (D) timeliness of filing; (E) flexibility to the extent possible
in plans of conversion taking into account the characteristics of par-
SEC. 111. No officer or agency of the United States shall have any 12
USC 250.
authority to require the Securities and Exchange Commission, the
ticular converting institutions; (F) the meeting of capital needs; and
Board of Governors of the Federal Reserve System, the Federal
(G) such other reasonable results as it may consider necessary or
Deposit Insurance Corporation, the Federal Home Loan Bank Board,
appropriate in the public interest."
or the National Credit Union Administration to submit legislative
recommendations, or testimony, or comments on legislation, to any
MORATORIUM ON CONVERSION OF FEDERAL DEPOSIT INSURANCE
officer or agency of the United States for approval, comments, or
CORPORATION INSURED INSTITUTIONS
review, prior to the submission of such recommendations, testimony, or
SEC. 106. Section 18(c) of the Federal Deposit Insurance Act (12
comments to the Congress if such recommendations, testimony, or com-
U.S.C. 1828 is amended by adding at the end thereof the follow-
ments to the Congress include a statement indicating that the views
ing new subsection:
expressed therein are those of the agency submitting them and do not
(10) Until June 30, 1976, the responsible agency shall not grant
necessarily represent the views of the President.
any approval required by law which has the practical effect of per-
INCREASE IN AUTHORITY OF THE TREASURY TO PURCHASE FEDERAL HOME
mitting a conversion from the mutual to the stock form of organiza-
LOAN BANK OBLIGATIONS
tion, including approval of any application pending on the date of
enactment of this subsection, except that this sentence shall not be
SEC. 112. Subsection (i) of section 11 of the Federal Home Loan
deemed to limit now or hereafter the authority of the responsible
Bank Act, as amended (12 U.S.C. 1431 is amended as follows:
agency to grant approvals in cases where the responsible agency finds
(1) In the fourth sentence of the first paragraph, strike out
that it must act in order to maintain the safety, soundness, and stability
"subsection" both places it appears and insert in lieu thereof
of an insured bank. The responsible agency may by rule, regulation, or
"paragraph".
otherwise and under such civil penalties (which shall be cumulative to
(2) Strike out the second paragraph and insert in lieu thereof
any other remedies) as it may prescribe take whatever action it deems
the following:
necessary or appropriate to implement or enforce this subsection."
"In addition to obligations authorized to be purchased by the
preceding paragraph, the Secretary of the Treasury is authorized to
EXTENSION OF FLEXIBLE REGULATION OF INTEREST RATES
purchase any obligations issued pursuant to this section in amounts
AUTHORITY
not to exceed $2,000,000,000. The authority provided in this paragraph
shall expire August 10, 1975.
SEC. 107. Section 7 of the Act of September 21, 1966 (Public Law
"Notwithstanding the foregoing, the authority provided in this
12 USC 461
89-597), is amended by striking out "December 31, 1974" and inserting
subsection may be exercised during any calendar quarter beginning
note.
in lieu thereof "December 31, 1975".
after the date of enactment of the Depository Institutions Amend-
ments of 1974 only if the Secretary of the Treasury and the Chairman
INCREASE DOLLARS LIMITATION ON THE COST FOR CONSTRUCTION OF
of the Federal Home Loan Bank Board certify to the Congress that
FEDERAL RESERVE BANK BRANCH BUILDINGS
(1) alternative means cannot be effectively employed to permit mem-
SEC. 108. The ninth paragraph of section 10 of the Federal Reserve
bers of the Home Loan Bank System to continue to supply reasonable
Act, as amended (12 U.S.C. 522), is amended by striking out
amounts of funds to the mortgage market, and (2) the ability to sup-
"$60,000,000" and inserting in lieu thereof "$140,000,000".
ply such funds is substantially impaired because of monetary strin-
gency and a high level of interest rates. Any funds borrowed under this
Repayment of
subsection shall be repaid by the Home Loan Banks at the earliest funds.
PURCHASE OF UNITED STATES OBLIGATIONS BY FEDERAL RESERVE BANKS
practicable date.".
SEC. 109. (a) Section 14(b) of the Federal Reserve Act, as
AUTHORITY OF THE FEDERAL HOME LOAN MORTGAGE CORPORATION
amended (12 U.S.C. 355), is amended by striking out "November 1,
1973" and inserting in lieu thereof "November 1, 1975" and by striking
TO PURCHASE MORTGAGES FROM STATE INSURED INSTITUTIONS
out "October 31, 1973" and inserting in lieu thereof "October 31, 1975".
SEC. 113. The first sentence of section 305(a) (1) of the Federal
Home Loan Mortgage Corporation Act is amended by inserting "or 12 USC 1454,
Pub. Law 93-495
- 8 -
October 28, 1974
October 28, 1974
- 9 -
Pub. Law 93-495
88 STAT. 1508
88 STAT. 1507
from any financial institution the deposits or accounts of which are
TITLE II-NATIONAL COMMISSION ON ELECTRONIC
insured under the laws of any State if the total amount of time and
FUND TRANSFERS
savings deposits held in all such institutions in that State is more than
20 per centum of the total amount of such deposits in all banks, build-
ESTABLISHMENT
ing and loan, savings and loan, and homestead associations (including
SEC. 201. There is established the National Commission on Elec- 12 USC 2401.
cooperative banks) in that State" immediately after "agency of the
tronic Fund Transfers (hereinafter referred to as the "Commission")
United States".
which shall be an independent instrumentality of the United States.
TECHNICAL AMENDMENT
MEMBERSHIP
SEC. 114. (a) Section 7(d) (2) of the Act of August 16, 1973 (Public
SEC. 202. (a) The Commission shall be composed of twenty-six 12 USC 2402.
12 USC 548
Law 93-100), is amended by striking out "the Commonwealth of
members as follows:
note.
Puerto Rico,".
(1) the Chairman of the Board of Governors of the Federal
(b) The amendment made by subsection (a) applies with respect
Reserve System or his delegate;
to any taxable year or other taxable period beginning on or after
(2) the Attorney General or his delegate;
August 16, 1973.
(3) the Comptroller of the Currency or his delegate;
(4) the Chairman of the Federal Home Loan Bank Board or
FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION SECONDARY
his delegate;
RESERVE ADJUSTMENT
(5) the Administrator of the National Credit Union Adminis-
SEC. 115. Paragraph (1) of subsection (d) of section 404 of the
tration or his delegate;
National Housing Act, as amended (12 U.S.C. 1727), is amended by
(6) the Chairman of the Board of Directors of the Federal
inserting "(A)" immediately after "(d) (1)" and by adding at the
Deposit Insurance Corporation or his delegate;
end thereof the following:
(7) the Chairman of the Federal Communications Commis-
"Minimum net
" (B) (i) As used in this subparagraph (B), 'minimum net reduc-
sion or his delegate;
reduction
year."
tion year' means a year in which, at the close of December 31, the
(8) the Postmaster General or his delegate;
aggregate of the primary reserve and secondary reserve equals or
(9) the Secretary of the Treasury or his delegate;
exceeds 11/4 per centum of the total amount of all accounts of insured
(10) the Chairman of the Federal Trade Commission or his
"Beginning
members of all insured institutions, and 'beginning balance' means,
delegate;
balance."
with respect to each insured institution, the amount of such institu-
(11) two individuals, appointed by the President, one of whom
tion's pro rata share, if any, of the secondary reserve as of the close
is an official of a State agency which regulates banking, or simi-
of December 31, 1973, plus any amount or amounts which, after such
lar financial institutions, and one of whom is an official of a State
close, shall have been transferred to such institution under the last
agency which regulates thrift or similar financial institutions;
sentence of subsection (e) of this section.
(12) seven individuals, appointed by the President, who are
(ii) In May of each year succeeding each of the first ten minimum
officers or employees of, or who otherwise represent banking,
net reduction years occurring after December 31, 1973, the Corporation
thrift, or other business entities, including one representative
shall reduce the amount of each insured institution's pro rata share, if
each of commercial banks, mutual savings banks, savings and
any, of the secondary reserve as of the preceding December 31 by
loan associations, credit unions, retailers, nonbanking institutions
making to the extent available, a cash refund to each such institution
offering credit card services, and organizations providing inter-
of the difference, if any, between such pro rata share and the applicable
change services for credit cards issued by banks;
percentage of its beginning balance prescribed in the following table:
(13) five individuals, appointed by the President, from private
life who are not affiliated with, do not represent and have no sub-
Percent of begin-
"Minimum net reduction year:
ning balance
stantial interest in any banking, thrift, or other financial institu-
1
98. 1818182
tion, including but not limited to credit unions, retailers, and
2
94. 5454546
insurance companies;
3
89. 0909091
(14) the Comptroller General of the United States or his
4
81. 8181818
5
72. 7272727
delegate; and
6
61. 8181818
(15) the Director of the Office of Technology Assessment.
7
49. 0909091
(b) The Chairperson shall be designated by the President at the
8
34. 5454546
time of his appointment from among the members of the Commission
9
18. 1818182
10
0. 0000000".
and such selection shall be by and with the advice and consent of the
Senate unless the appointee holds an office to which he was appointed
CREDIT UNION MANAGEMENT: REASONABLE HEALTH AND ACCIDENT
by and with the advice and consent of the Senate.
INSURANCE NOT CONSIDERED COMPENSATION
(c) A vacancy in the Commission shall be filled in the manner in
which the original appointment was made.
SEC. 116. Section 111 of the Federal Credit Union Act (12 U.S.C.
1761) is amended by striking the period at the end thereof and adding
FUNCTIONS
Provided, however, That reasonable health, accident, and similar
insurance protection shall not be considered compensation under regu-
SEC. 203. (a) The Commission shall conduct a thorough study and Study.
lations promulgated by the Administrator.".
investigation and recommend appropriate administrative action and 12 USC 2403.
Pub. Law 93-495
- 10 -
October 28, 1974
88 STAT. 1509
October 28, 1974
- 11 -
Pub. Law 93-495
88 STAT. 1510
legislation necessary in connection with the possible development of
ducted or within the judicial district within which such person is
public or private electronic fund transfer systems, taking into account,
found or resides or transacts business may (upon application by the
among other things-
Commission) order such person to appear before the Commission to
(1) the need to preserve competition among the financial
produce evidence or to give testimony touching the matter under
institutions and other business enterprises using such a system;
investigation. Any failure to obey such order of the court may be
(2) the need to promote competition among financial institu-
punished by such court as a contempt thereof.
tions and to assure Government regulation and involvement or
(3) The subpenas of the Commission shall be served in the manner
participation in a system competitive with the private sector be
provided for subpenas issued by a United States district court under
kept to a minimum;
the Federal Rules of Civil Procedure for the United States district
(3) the need to prevent unfair or discriminatory practices by
courts.
any financial institution or business enterprise using or desiring
(4) All process of any court to which application may be made
to use such a system;
under this section may be served in the judicial district wherein the
(4) the need to afford maximum user and consumer conven-
person required to be served resides or may be found.
ience;
(5) the need to afford maximum user and consumer rights to
ADMINISTRATION
privacy and confidentiality;
(6) the impact of such a system on economic and monetary
SEC. 205. (a) The Commission-
12 USC 2405.
policy;
(7) the implications of such a system on the availability of
(1) may appoint with the advice and consent of the Senate
credit;
and fix the compensation of an Executive Director, and such
(8) the implications of such a system expanding internationally
additional staff personnel as he deems necessary, without regard
and into other forms of electronic communications; and
to the provisions of title 5, United States Code, governing appoint-
5 USC 101 et
(9) the need to protect the legal rights of users and consumers.
ments in the competitive service, and without regard to chapter
seq.
Interim report.
(b) The Commission shall make an interim report within one year
51 and subchapter III of chapter 53 of such title relating to
5 USC 5101,
of its findings and recommendations and at such other times as it
classification and General Schedule pay rates, but at rates not
5331.
Final report
deems advisable and shall transmit to the President and to the Con-
in excess of the maximum rate for GS-18 of the General Schedule
to President
gress not later than two years after the date of enactment of this Act a
under section 5332 of such title; and
5 USC 5332
and Congress.
final report of its findings and recommendations. Any such report shall
(2) may procure temporary and intermittent services to the
note.
include all hearing transcripts, staff studies, and other material used
same extent as is authorized by section 3109 of title 5, United
Experts and
in preparation of the report. The interim and final reports shall be
States Code, but at rates not to exceed $150 a day for individuals.
consultants.
Termination
made available to the public upon transmittal. Sixty days after trans-
(b) The Comptroller General is authorized to make detailed audits
Audits, report
date.
mission of its final report the Commission shall cease to exist.
of the books and records of the Commission, and shall report the results
to Congress.
(c) The Commission shall not be required to obtain the clearance
of any such audit to the Commission and to the Congress.
of any Federal agency prior to the transmittal of any interim or final
report.
COMPENSATION
POWERS OF COMMISSION
SEC. 206. (a) A member of the Commission who is an officer or 12 USC 2406.
Hearings.
SEC. 204. (a) The Commission may for the purpose of carrying out
employee of the United States shall serve as a member of the Com-
12 USC 2404.
this Act hold such hearings, sit and act at such times and places, take
mission without additional compensation, but shall be entitled to
such testimony, and receive such evidence, as the Commission may
reimbursement for travel, subsistence, and other necessary expenses
deem advisable. The Commission may administer oaths of affirmations
incurred in the performance of his duties as a member of the
to witnesses appearing before it.
Commission.
(b) When so authorized by the Commission, any member or agent
(b) A member of the Commission who is not otherwise an officer
of the Commission may take any action which the Commission is
or employee of the United States shall be compensated at a rate of
authorized to take by this section.
$150 per day when engaged in the performance of his duties as a
(c) The Commission may secure directly from any department or
member of the Commission, and shall also be reimbursed for travel,
agency of the United States Information necessary to enable it to carry
subsistence, and other necessary expenses incurred in the performance
out this Act. Upon request of the Chairperson of the Commission, the
of his duties as a member of the Commission.
head of such department or agency shall furnish such information to
the Commission.
ASSISTANCE OF GOVERNMENT AGENCIES
Subpenas.
(d) (1) The Commission shall have power to issue subpenas requir-
ing the attendance and testimony of witnesses and the production of
SEC. 207. (a) Each department, agency, and instrumentality of the 12 USC 2407.
any evidence that relates to any matter under investigation by the
executive branch of the Government, including independent agen-
Commission. Such attendance of witnesses and the production of such
cies, is authorized and directed to furnish to the Commission, upon
evidence may be required from any place within the United States
request, such data, reports, and other information as the Commission
at any designated place of hearing within the United States.
deems necessary to carry out its functions under this title.
(2) If a person issued a subpena under paragraph (1) refuses to
(b) The head of any department, agency, or instrumentality of the
obey such subpena or is guilty of contumacy, any court of the United
United States may detail such personnel and may furnish such services,
States within the judicial district within which the hearing is con-
with or without reimbursement, as the Commission may request to
assist it in carrying out its functions.
Pub. Law 93-495
- 12 -
October 28, 1974
October 28, 1974
- 13 -
Pub. Law 93-495
88 STAT. 1512
88 STAT. 1511
AUTHORIZATION OF APPROPRIATIONS
"(11) The address to be used by the creditor for the purpose
SEC. 208. There are authorized to be appropriated without fiscal
of receiving billing inquiries from the obligor."
12 USC 2408.
year limitations such sums, not to exceed $2,000,000, as may be neces-
§ 306. Billing practices
sary to carry out the provisions of this title.
The Truth in Lending Act (15 U.S.C. 1601-1665) is amended by
adding at the end thereof a new chapter as follows:
TITLE III-FAIR CREDIT BILLING
"Chapter 4-CREDIT BILLING
§ 301. Short title
"Sec.
Fair Credit
This title may be cited as the "Fair Credit Billing Act".
"161. Correction of billing errors.
Billing Act.
"162. Regulation of credit reports.
§ 302. Declaration of purpose
"163. Length of billing period.
15 USC 1601
"164. Prompt crediting of payments.
note.
The last sentence of section 102 of the Truth in Lending Act (15
"165. Crediting excess payments.
U.S.C. 1601) is amended by striking out the period and inserting in
"166. Prompt notification of returns.
lieu thereof a comma and the following: "and to protect the consumer
"167. Use of cash discounts.
against inaccurate and unfair credit billing and credit card practices."
"168. Prohibition of tie-in services.
"169. Prohibition of offsets.
§ 303. Definitions of creditor and open end credit plan
"170. Rights of credit card customers.
The first sentence of section 103(f) of the Truth in Lending Act
"171. Relation to State laws.
(15 U.S.C. 1602 is amended to read as follows: "The term 'credi-
161. Correction of billing errors
tor' refers only to creditors who regularly extend, or arrange for the
(a) If a creditor, within sixty days after having transmitted to an 15 USC 1666.
extension of, credit which is payable by agreement in more than four
obligor a statement of the obligor's account in connection with an
installments or for which the payment of a finance charge is or may
extension of consumer credit, receives at the address disclosed under
be required, whether in connection with loans, sales of property or
section 127 (b) (11) a written notice (other than notice on a payment
Ante, P. 1511.
services, or otherwise. For the purposes of the requirements imposed
stub or other payment medium supplied by the creditor if the creditor
under Chapter 4 and sections (6), 127 (a) (7), 127 (8), 127
SO stipulates with the disclosure required under section 127 (a) (8)) Ante, p.
1511.
(b) (1), 127 (b) (2), 127 (b) (3), 127 (b) (9), and 127 (b) (11) of Chapter
from the obligor in which the obligor-
Post, p. 1512.
2 of this Title, the term 'creditor' shall also include card issuers whether
"(1) sets forth or otherwise enables the creditor to identify the
Infra,
or not the amount due is payable by agreement in more than four
name and account number (if any) of the obligor,
15 USC 1637.
installments or the payment of a finance charge is or may be required,
"(2) indicates the obligor's belief that the statement contains
and the Board shall, by regulation, apply these requirements to such
a billing error and the amount of such billing error, and
card issuers, to the extent appropriate, even though the requirements
"(3) sets forth the reasons for the obligor's belief (to the
are by their terms applicable only to creditors offering open end
extent applicable) that the statement contains a billing error,
credit plans.
the creditor shall, unless the obligor has, after giving such written
§ 304. Disclosure of fair credit billing rights
notice and before the expiration of the time limits herein specified,
(a) Section 127(a) of the Truth in Lending Act (15 U.S.C. 1637
agreed that the statement was correct-
(a)) is amended by adding at the end thereof a new paragraph as
"(A) not later than thirty days after the receipt of the notice,
follows:
send a written acknowledgement thereof to the obligor, unless the
"(8) A statement, in a form prescribed by regulations of the
action required in subparagraph (B) is taken within such thirty-
Post, pp. 1512,
Board of the protection provided by sections 161 and 170 to an
day period, and
1515.
obligor and the creditor's responsibilities under sections 162 and
" (B) not later than two complete billing cycles of the creditor
170. With respect to each of two billing cycles per year, at semi-
(in no event later than ninety days) after the receipt of the notice
annual intervals, the creditor shall transmit such statement to each
and prior to taking any action to collect the amount, or anv part
obligor to whom the creditor is required to transmit a statement
thereof, indicated by the obligor under paragraph (2) either-
pursuant to section 127(b) for such billing cycle."
(i) make appropriate corrections in the account of the
(b) Section 127 (c) of such Act (15 U.S.C. 1637 is amended to
obligor, including the crediting of any finance charges on
read:
amounts erroneously billed, and transmit to the obligor a
"(c) In the case of any existing account under an open end con-
notification of such corrections and the creditor's explanation
sumer credit plan having an outstanding balance of more than $1 at
of any change in the amount indicated by the obligor under
or after the close of the creditor's first full billing cycle under the plan
paragraph (2) and, if any such change is made and the
after the effective date of subsection (a) or any amendments thereto,
obligor SO requests, copies of documentary evidence of the
the items described in subsection (a), to the extent applicable and not
obligor's indebtedness; or
previously disclosed, shall be disclosed in a notice mailed or delivered
(ii) send a written explanation or clarification to the
to the obligor not later than the time of mailing the next statement
obligor, after having conducted an investigation, setting
required by subsection (b)."
forth to the extent applicable the reasons why the creditor
believes the account of the obligor was correctly shown in
§ 305. Disclosure of billing contact
the statement and, upon request of the obligor, provide copies
Section 127 (b) of the Truth in Lending Act (15 U.S.C. 1637 is
of documentary evidence of the obligor's indebtedness. In
amended by adding at the end thereof a new paragraph as follows:
the case of a billing error where the obligor alleges that the
creditor's billing statement reflects goods not delivered to
Pub. Law 93-495
- 14 -
October 28, 1974
October 28, 1974
- 15 -
Pub. Law 93-495
88 STAT. 1513
88 STAT. 1514
the obligor or his designee in accordance with the agreement
to report to any person adversely on the obligor's credit rating or
made at the time of the transaction, a creditor may not con-
credit standing because of the obligor's failure to pay the amount
strue such amount to be correctly shown unless he determines
indicated by the obligor under section 161 (a) (2), and such amount
that such goods were actually delivered, mailed, or otherwise
may not be reported as delinquent to any third party until the creditor
sent to the obligor and provides the obligor with a statement
has met the requirements of section 161 and has allowed the obligor
of such determination.
the same number of days (not less than ten) thereafter to make
After complying with the provisions of this subsection with respect
payment as is provided under the credit agreement with the obligor
to an alleged billing error, a creditor has no further responsibility
for the payment of undisputed amounts.
under this section if the obligor continues to make substantially the
'(b) If a creditor receives a further written notice from an obligor
same allegation with respect to such error.
that an amount is still in dispute within the time allowed for payment
Definitions.
"(b) For the purpose of this section, a 'billing error' consists of any
under subsection (a) of this section, a creditor may not report to any
of the following:
third party that the amount of the obligor is delinquent because the
"(1) A reflection on a statement of an extension of credit which
obligor has failed to pay an amount which he has indicated under
was not made to the obligor or, if made, was not in the amount
section 161 (a) (2), unless the creditor also reports that the amount
reflected on such statement.
is in dispute and, at the same time, notifies the obligor of the name
'(2) A reflection on a statement of an extension of credit for
and address of each party to whom the creditor is reporting informa-
which the obligor requests additional clarification including docu-
tion concerning the delinquency.
mentary evidence thereof.
(c) A creditor shall report any subsequent resolution of any delin-
"(3) A reflection on a statement of goods or services not
quencies reported pursuant to subsection (b) to the parties to whom
accepted by the obligor or his designee or not delivered to the
such delinquencies were initially reported.
obligor or his designee in accordance with the agreement made
at the time of a transaction.
"§ 163. Length of billing period
"(4) The creditor's failure to reflect properly on a statement
"(a) If an open end consumer credit plan provides a time period 15 USC 1666b.
a payment made by the obligor or a credit issued to the obligor.
within which an obligor may repay any portion of the credit extended
(5) A computation error or similiar error of an accounting
without incurring an additional finance charge, such additional
nature of the creditor on a statement.
finance charge may not be imposed with respect to such portion of the
"(6) Any other error described in regulations of the Board.
credit extended for the billing cycle of which such period is a part
'(c) For the purposes of this section, 'action to collect the amount,
unless a statement which includes the amount upon which the finance
or any part thereof, indicated by an obligor under paragraph (2)
charge for that period is based was mailed at least fourteen days
does not include the sending of statements of account to the obligor
prior to the date specified in the statement by which payment must
following written notice from the obligor as specified under sub-
be made in order to avoid imposition of that finance charge.
section (a), if-
"(b) Subsection (a) does not apply in any case where a creditor
"(1) the obligor's account is not restricted or closed because of
has been prevented, delayed, or hindered in making timely mailing or
the failure of the obligor to pay the amount indicated under
delivery of such periodic statement within the time period specified
paragraph (2) of subsection (a), and
in such subsection because of an act of God, war, natural disaster,
"(2) the creditor indicates the payment of such amount is
strike, or other excusable or justifiable cause, as determined under reg-
not required pending the creditor's compliance with this section.
ulations of the Board.
Nothing in this section shall be construed to prohibit any action by
"§ 164. Prompt crediting of payments
a creditor to collect any amount which has not been indicated by the
"Payments received from an obligor under an open end consumer 15 USC 1666c.
obligor to contain a billing error.
credit plan by the creditor shall be posted promptly to the obligor's
(d) Pursuant to regulations of the Board, a creditor operating an
account as specified in regulations of the Board. Such regulations shall
open end consumer credit plan may not, prior to the sending of the
prevent a finance charge from being imposed on any obligor if the
written explanation or clarification required under paragraph (B)
creditor has received the obligor's payment in readily identifiable form
(ii), restrict or close an account with respect to which the obligor has
in the amount, manner, location, and time indicated by the creditor
indicated pursuant to subsection (a) that he believes such account to
to avoid the imposition thereof.
contain a billing error solely because of the obligor's failure to pay
"§ 165. Crediting excess payments
the amount indicated to be in error. Nothing in this subsection shall
be deemed to prohibit a creditor from applying against the credit
"Whenever an obligor transmits funds to a creditor in excess of the 15 USC 1666d.
limit on the obligor's account the amount indicated to be in error.
total balance due on an open end consumer credit account, the creditor
Noncomp liance.
(e) Any creditor who fails to comply with the requirements of this
shall promptly (1) upon request of the obligor refund the amount of
section or section 162 forfeits any right to collect from the obligor
the overpayment, or (2) credit such amount to the obligor's account.
the amount indicated by the obligor under paragraph (2) of sub-
"§ 166. Prompt notification of returns
section (a) of this section, and any finance charges thereon, except
"With respect to any sales transaction where a credit card has been 15 USC 1666e.
that the amount required to be forfeited under this subsection may
used to obtain credit, where the seller is a person other than the card
not exceed $50.
issuer, and where the seller accepts or allows a return of the goods
"§ 162. Regulation of credit reports
or forgiveness of a debit for services which were the subject of such
15 USC 1666a.
(a) After receiving a notice from an obligor as provided in section
sale, the seller shall promptly transmit to the credit card issuer, a
credit statement with respect thereto and the credit card issuer shall
(a), a creditor or his agent may not directly or indirectly threaten
credit the account of the obligor for the amount of the transaction.
Pub. Law 93-495
- 16 -
October 28, 1974
October 28, 1974
- 17 -
Pub. Law 93-495
88 STAT. 1515
88 STAT. 1516
"§ 167. Use of cash discounts
transaction exceeds $50; and (3) the place where the initial transaction
15 USC 1666f.
(a) With respect to credit card which may be used for extensions
occurred was in the same State as the mailing address previously pro-
of credit in sales transactions in which the seller is a person other than
vided by the cardholder or was within 100 miles from such address,
the card issuer, the card issuer may not, by contract or otherwise,
except that the limitations set forth in clauses (2) and (3) with
prohibit any such seller from offering a discount to a cardholder to
respect to an obligor's right to assert claims and defenses against a
induce the cardholder to pay by cash, check, or similar means rather
card issuer shall not be applicable to any transaction in which the
than use a credit card.
]
person honoring the credit card (A) is the same person as the card
"(b) With respect to any sales transaction, any discount not in excess
issuer, (B) is controlled by the card issuer, (C) is under direct or
of 5 per centum offered by the seller for the purpose of inducing pay-
ment by cash, check, or other means not involving the use of a credit
-
indirect common control with the card issuer, (D) is a franchised
dealer in the card issuer's products or services, or (E) has obtained
card shall not constitute a finance charge as determined under section
the order for such transaction through a mail solicitation made by or
106, if such discount is offered to all prospective buyers and its avail-
participated in by the card issuer in which the cardholder is solicited
ability is disclosed to all prospective buyers clearly and conspicuously
to enter into such transaction by using the credit card issued by the
in accordance with regulations of the Board.
card issuer.
"§ 168. Prohibition of tie-in services
(b) The amount of claims or defenses asserted by the cardholder
may not exceed the amount of credit outstanding with respect to such
15 USC 1666g.
"Notwithstanding any agreement to the contrary, a card issuer may
transaction at the time the cardholder first notifies the card issuer or
not require a seller, as a condition to participating in a credit card plan,
the person honoring the credit card of such claim or defense. For the
to open an account with or procure any other service from the card
purpose of determining the amount of credit outstanding in the
issuer or its subsidiary or agent.
preceding sentence, payments and credits to the cardholder's account
"§ 169. Prohibition of offsets
are deemed to have been applied, in the order indicated, to the payment
15 USC 1666h.
(a) A card issuer may not take any action to offset a cardholder's
of: (1) late charges in the order of their entry to the account; (2)
indebtedness arising in connection with a consumer credit transaction
finance charges in order of their entry to the account; and (3) debits
under the relevant credit card plan against funds of the cardholder
to the account other than those set forth above, in the order in which
held on deposit with the card issuer unless-
each debit entry to the account was made.
"(1) such action was previously authorized in writing by the
"§ 171. Relation to State laws
cardholder in accordance with a credit plan whereby the card-
(a) This chapter does not annul, alter, or affect, or exempt any 15 USC 1666j.
holder agrees periodically to pay debts incurred in his open end
person subject to the provisions of this chapter from complying with,
credit account by permitting the card issuer periodically to deduct
the laws of any State with respect to credit billing practices, except to
all or a portion of such debt from the cardholder's deposit account,
the extent that those laws are inconsistent with any provision of this
and
chapter, and then only to the extent of the inconsistency. The Board is
(2) such action with respect to any outstanding disputed
authorized to determine whether such inconsistencies exist. The Board
amount not be taken by the card issuer upon request of the card-
may not determine that any State law is inconsistent with any pro-
holder.
vision of this chapter if the Board determines that such law gives
In the case of any credit card account in existence on the effective date
greater protection to the consumer.
of this section, the previous written authorization referred to in clause
'(b) The Board shall by regulation exempt from the requirements
(1) shall not be required until the date (after such effective date) when
of this chapter any class of credit transactions within any State if it
such account is renewed, but in no case later than one year after such
determines that under the law of that State that class of transactions
effective date. Such written authorization shall be deemed to exist if
is subject to requirements substantially similar to those imposed under
the card issuer has previously notified the cardholder that the use of
this chapter or that such law gives greater protection to the consumer,
his credit card account will subject any funds which the card issuer
and that there is adequate provision for enforcement."
holds in deposit accounts of such cardholder to offset against any
amounts due and payable on his credit card account which have not
§ 307. Conforming amendments
been paid in accordance with the terms of the agreement between the
(a) The table of chapters of the Truth in Lending Act is amended
card issuer and the cardholder.
by adding immediately under item 3 the following:
(b) This section does not alter or affect the right under State law
"4. CREDIT BILLING
161"
of a card issuer to attach or otherwise levy upon funds of a cardholder
(b) Section 111 (d) of such Act (15 U.S.C. is amended by
held on deposit with the card issuer if that remedy is constitutionally
striking out "and 130" and inserting in lieu thereof a comma and the
available to creditors generally.
following "130, and 166".
"§ 170. Rights of credit card customers
(c) Section 121 (a) of such Act (15 U.S.C. 1631 (a)) is amended—
15 USC 16661.
'(a) Subject to the limitation contained in subsection (b), a card
(1) by striking out "and upon whom a finance charge is or may
issuer who has issued a credit card to a cardholder pursuant to an
be imposed"; and
open end consumer credit plan shall be subject to all claims (other
(2) by inserting "or chapter 4" immediately after "this
than tort claims) and defenses arising out of any transaction in which
chapter".
the credit card is used as a method of payment or extension of credit
(d) Section 121 (b) of such Act (15 U.S.C. 1631 (b)) is amended by
if (1) the obligor has made a good faith attempt to obtain satisfactory
inserting "or chapter 4" immediately after "this chapter".
resolution of a disagreement or problem relative to the transaction
(e) Section 122(a) of such Act (15 U.S.C. 1632 is amended by
from the person honoring the credit card; (2) the amount of the initial
inserting "or chapter 4" immediately after "this chapter".
Pub. Law 93-495
- 18 -
October 28, 1974
October 28, 1974
- 19 -
Pub. Law 93-495
88 STAT. 1518
88 STAT. 1517
(f) Section of such Act (15 U.S.C. is amended
closures required under this chapter have not been delivered to the
by inserting "or chapter 4" immediately after "this chapter".
obligor."
§ 308. Effective date
§ 406. Good faith compliance
15 USC 1666
This title takes effect upon the expiration of one year after the date
Section 130 of the Truth in Lending Act (15 U.S.C. 1640) is
note.
of its enactment.
amended by adding at the end thereof a new subsection as follows:
"(f) No provision of this section or section 112 imposing any liabil-
TITLE IV-AMENDMENTS TO THE TRUTH IN LENDING
ity shall apply to any act done or omitted in good faith in conformity
ACT
with any rule, regulation, or interpretation thereof by the Board, not-
withstanding that after such act or omission has occurred, such rule,
§ 401. Advertising; more-than-four-installment rule
regulation, or interpretation is amended, rescinded, or determined by
(a) Chapter 3 of the Truth in Lending Act (15 U.S.C. 1661-1665)
judicial or other authority to be invalid for any reason."
is amended by adding at the end thereof a new section as follows:
§ 407. Liability for multiple disclosures
"§ 146. More-than-four-installment rule
Section 130 of the Truth in Lending Act (15 U.S.C. 1640) is amended
15 USC 1665a.
"Any advertisement to aid, promote, or assist directly or indirectly
by adding at the end thereof a new subsection as follows:
the extension of consumer credit repayable in more than four install-
"(g) The multiple failure to disclose to any person any information
ments shall, unless a finance charge is imposed, clearly and conspicu-
required under this chapter to be disclosed in connection with a single
ously state, in accordance with the regulations of the Board:
account under an open end consumer credit plan, other single con-
"THE COST OF CREDIT IS INCLUDED IN THE
sumer credit sale, consumer loan, or other extension of consumer credit,
PRICE QUOTED FOR THE GOODS AND SERVICES."
shall entitle the person to a single recovery under this section but
(b) The table of sections of such chapter is amended by adding
continued failure to disclose after a recovery has been granted shall
at the end thereof a new item as follows:
give rise to rights to additional recoveries."
"146. More-than-four-installment rule.".
§ 408. Civil liability
§ 402. Agricultural credit exemption
(a) Section 130(a) of the Truth in Lending Act (15 U.S.C. 1640(a))
Section 104 of the Truth in Lending Act (15 U.S.C. 1603) is
is amended to read as follows:
amended by adding at the end thereof a new paragraph as follows:
"(a) Except as otherwise provided in this section, any creditor
"(5) Credit transactions primarily for agricultural purposes
who fails to comply with any requirement imposed under this chapter
in which the total amount to be financed exceeds $25,000."
or chapter 4 of this title with respect to any person is liable to such Ante, P. 1512.
person in an amount equal to the sum of-
§ 403. Administrative enforcement
"(1) any actual damage sustained by such person as a result of
(a) Section 108(a) of the Truth in Lending Act (15 U.S.C. 1607
the failure;
(a)) is amended by striking out paragraph (4) and by redesignating
"(2) (A) in the case of an individual action twice the amount
paragraphs (5) and (6) as paragraphs (4) and (5), respectively.
of any finance charge in connection with the transaction, except
(b) Section 108(a) of such Act (15 U.S.C. 1607 (a)) is amended
that the liability under this subparagraph shall not be less than
by adding at the end thereof a new paragraph as follows:
$100 nor greater than $1,000; or
12 USC 2001
"(6) the Farm Credit Act of 1971, by the Farm Credit Ad-
((B) in the case of a class action, such amount as the court
note.
ministration with respect to any Federal land bank, Federal land
may allow, except that as to each member of the class no minimum
bank association, Federal intermediate credit bank, or produc-
recovery shall be applicable, and the total recovery in such action
tion credit association."
shall not be more than the lesser of $100,000 or 1 per centum of
§ 404. Liens arising by operation of State law
the net worth of the creditor; and
Section 125 of the Truth in Lending Act (15 U.S.C. 1635) is
"(3) in the case of any successful action to enforce the fore-
going liability, the costs of the action, together with a reasonable
amended---
(1) by striking out "is" the first time it appears in the first
attorney's fee as determined by the court.
sentence of subsection (a) and inserting in lieu thereof includ-
In determining the amount of award in any class action, the court
ing any such interest arising by operation of law, is or will be";
shall consider, among other relevant factors, the amount of any actual
damages awarded, the frequency and persistence of failures of com-
and
(2) by inserting after "obligor" the second time it appears in
pliance by the creditor, the resources of the creditor, the number of
the first sentence of subsection (b) the following: including any
persons adversely affected, and the extent to which the creditor's failure
of compliance was intentional."
such interest arising by operation of law,".
(b) Section 130(b) of such Act (15 U.S.C. 1640 is amended by
§ 405. Time limit for right of rescission
inserting after "this section" the first place it appears the following:
Section 125 of the Truth in Lending Act (15 U.S.C. 1635) is
"for any failure to comply with any requirement imposed under this
amended by adding at the end thereof a new subsection as follows:
chapter,".
"(f) An obligor's right of rescission shall expire three years after
(c) Section 130(c) of such Act (15 U.S.C. 1640(c)) is amended by
the date of consummation of the transaction or upon the sale of the
striking out "chapter" and inserting in lieu thereof "title".
property, whichever occurs earlier, notwithstanding the fact that the
(d) Section 130 of such Act (15 U.S.C. 1640) is amended by adding
disclosures required under this section or any other material dis-
at the end thereof a new subsection as follows:
"(h) A person may not take any action to offset any amount for
which a creditor is potentially liable to such person under subsection
Pub. Law 93-495
- 20 -
October 28, 1974
October 28, 1974
- 21 -
Pub. Law 93-495
88 STAT. 1519
88 STAT. 1520
(a) (2) against any amount owing to such creditor by such person,
§ 413. Liability of assignees
unless the amount of the creditor's liability to such person has been
(a) Chapter 1 of the Truth in Lending Act (15 U.S.C. 1601-1613)
determined by judgment of a court of competent jurisdiction in an
is amended by adding at the end thereof a new section as follows:
action to which such person was a party."
115. Liability of assignees
15 USC 640
(e) The amendments made by sections 406, 407, and 408 shall apply
note.
in determining the liability of any person under chapter 2 or 4 of the
"Except as otherwise specifically provided in this title, any civil 15 USC 1614.
Truth in Lending Act, unless prior to the date of enactment of this
action for a violation of this title which may be brought against the
Act such liability has been determined by final judgment of a court
original creditor in any credit transaction may be maintained against
of competent jurisdiction and no further review of such judgment
any subsequent assignee of the original creditor where the violation
may be had by appeal or otherwise.
from which the alleged liability arose is apparent on the face of the
instrument assigned unless the assignment is involuntary."
§ 409. Full statement of closing costs
(b) The analysis of such chapter is amended by adding at the end
Section 121 of the Truth in Lending Act (15 U.S.C. 1631) is
thereof a new item as follows:
amended by adding at the end thereof a new subsection as follows:
"115. Liability of assignees.".
"(c) For the purpose of subsection (a), the information required
under this chapter shall include a full statement of closing costs to be
§ 414. Credit card fraud
incurred by the consumer, which shall be presented, in accordance
Section 134 of the Truth in Lending Act (15 U.S.C. 1644) is amended
with the regulations of the Board-
to read as follows:
"(1) prior to the time when any downpayment is made, or
"§ 134. Fraudulent use of credit card
"(2) in the case of a consumer credit transaction involving real
(a) Whoever knowingly in a transaction affecting interstate or
property, at the time the creditor makes a commitment with
foreign commerce, uses or attempts or conspires to use any counter-
respect to the transaction.
feit, fictitious, altered, forged, lost, stolen, or fraudulently obtained
The Board may provide by regulation that any portion of the informa-
credit card to obtain money, goods, services, or anything else of value
tion required to be disclosed by this section may be given in the form
which within any one-year period has a value aggregating $1,000 or
of estimates where the provider of such information is not in a posi-
more; or
tion to know exact information."
"(b) Whoever, with unlawful or fraudulent intent, transports or
§ 410. Business use of credit cards
attempts or conspires to transport in interstate or foreign commerce a
(a) Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631-1644)
counterfeit, fictitious, altered, forged, lost, stolen, or fraudulently
is amended by adding the following new section at the end thereof:
obtained credit card knowing the same to be counterfeit, fictitious,
altered, forged, lost, stolen, or fraudulently obtained; or
"§ 135. Business credit cards
(c) Whoever, with unlawful or fraudulent intent, uses any instru-
15 USC 1645.
"The exemption provided by section 104(1) does not apply to the
mentality of interstate or foreign commerce to sell or transport a
15 USC 1642,
provisions of sections 132, 133, and 134, except that a card issuer and
counterfeit, fictitious, altered, forged, lost, stolen, or fraudulently
1643, 1644.
a business or other organization which provides credit cards issued
obtained credit card knowing the same to be counterfeit, fictitious,
by the same card issuer to ten or more of its employees may by contract
altered, forged, lost, stolen, or fraudulently obtained; or
agree as to liability of the business or other organization with respect
"(d) Whoever knowingly receives, conceals, uses, or transport
to unauthorized use of such credit cards without regard to the provi-
money, goods, services, or anything else of value (except tickets for
sions of section 133, but in no case may such business or other organi-
interstate or foreign transportation) which (1) within any one-year
zation or card issuer impose liability upon any employee with respect
period has a value aggregating $1,000 or more, (2) has moved in or is
to unauthorized use of such a credit card except in accordance with and
part of, or which constitutes interstate or foreign commerce, and (3)
subject to the limitations of section 133."
has been obtained with a counterfeit, fictitious, altered, forged, lost,
(b) The table of sections of such chapter is amended by adding at
stolen, or fraudulently obtained credit card; or
the end thereof a new item as follows:
"(e) Whoever knowingly receives, conceals, uses, sells, or transports
"135. Business credit cards.".
in interstate or foreign commerce one or more tickets for interstate or
§ 411. Identification of transaction
foreign transportation, which (1) within any one-year period have
a value aggregating $500 or more, and (2) have been purchased or
Section (2) of the Truth in Lending Act (15 U.S.C. 1637
obtained with one or more counterfeit, fictitious, altered, forged, lost,
(b) (2)) is amended to read as follows:
stolen, or fraudulently obtained credit cards; or
(2) The amount and date of each extension of credit during the
"(f) Whoever in a transaction affecting interstate or foreign com-
period and a brief identification on or accompanying the statement of
merce furnishes money, property, services, or anything else of value,
each extension of credit in a form prescribed by regulations of the
which within any one-year period has a value aggregating $1,000 or
Board sufficient to enable the obligor to identify the transaction, or
more, through the use of any counterfeit, fictitious, altered, forged,
relate it to copies of sales vouchers or similar instruments previously
lost, stolen, or fraudulently obtained credit card knowing the same to
furnished."
be counterfeit, fictitious, altered, forged, lost, stolen, or fraudulently
§ 412. Exemption for State lending agencies
obtained-
Section 125 of the Truth in Lending Act (15 U.S.C. 1635 is
shall be fined not more than $10,000 or imprisoned not more than ten Penalty.
amended by striking the period at the end thereof and adding the
years, or both."
following: "or to a consumer credit transaction in which an agency of
a State is the creditor."
Pub. Law 93-495
- 22 -
October 28, 1974
October 28, 1974
- 23 -
Pub. Law 93-495
88 STAT. 1521
88 STAT. 1522
§ 415. Grace period for consumers
taining the creditor's rights and remedies applicable to the particular
Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is
extension of credit, and not to discriminate in a determination of
amended-
creditworthiness.
(1) by amending subsection (a) (1) to read as follows:
702. Definitions
(1) The conditions under which a finance charge may be
imposed, including the time period (if any) within which any
"(a) The definitions and rules of construction set forth in this 15 USC 1691a.
credit extended may be repaid without incurring a finance charge,
section are applicable for the purposes of this title.
except that the creditor may, at his election and without dis-
"(b) The term 'applicant' means any person who applies to a
closure, impose no such finance charge if payment is received after
creditor directly for an extension, renewal, or continuation of credit,
the termination of such time period. and
or applies to a creditor indirectly by use of an existing credit plan for
(2) by amending subsection (b) (10) to read as follows:
an amount exceeding a previously established credit limit.
(10) The date by which or the period (if any) within which,
"(c) The term 'Board' refers to the Board of Governors of the
payment must be made to avoid additional finance charges, except
Federal Reserve System.
that the creditor may, at his election and without disclosure,
"(d) The term 'credit' means the right granted by a creditor to a
impose no such additional finance charge if payment is received
debtor to defer payment of debt or to incur debts and defer its payment
after such date or the termination of such period."
or to purchase property or services and defer payment therefor.
'(e) The term 'creditor' means any person who regularly extends,
§ 416. Effective date
renews, or continues credit; any person who regularly arranges for
15 USC 1665a
This title takes effect upon the date of its enactment, except that
the extension, renewal, or continuation of credit; or any assignee of an
note.
sections 409 and 411 take effect upon the expiration of one year after
original creditor who participates in the decision to extend, renew, or
the date of its enactment.
continue credit.
(f) The term 'person' means a natural person, a corporation,
TITLE V-EQUAL CREDIT OPPORTUNITY
government or governmental subdivision or agency, trust, estate, part-
nership, cooperative, or association.
§ 501. Short title
"(g) Any reference to any requirement imposed under this title or
Equal Credit
This title may be cited as the "Equal Credit Opportunity Act".
any provision thereof includes reference to the regulations of the
Opportunity
Board under this title or the provision thereof in question.
Act.
§ 502. Findings and purpose
15 USC 1691
The Congress finds that there is a need to insure that the various
"§ 703. Regulations
note.
financial institutions and other firms engaged in the extensions of
"The Board shall prescribe regulations to carry out the purposes of 15 USC 1691b.
15 USC 1691
credit exercise their responsibility to make credit available with fair-
this title. These regulations may contain but are not limited to such
note.
ness, impartiality, and without discrimination on the basis of sex or
classifications, differentiation, or other provision, and may provide
marital status. Economic stabilization would be enhanced and compe-
for such adjustments and exceptions for any class of transactions, as
tition among the various financial institutions and other firms engaged
in the judgment of the Board are necessary or proper to effectuate
in the extension of credit would be strengthened by an absence of dis-
the purposes of this title, to prevent circumvention or evasion thereof,
crimination on the basis of sex or marital status, as well as by the
or to facilitate or substantiate compliance therewith. Such regulations
informed use of credit which Congress has heretofore sought to
shall be prescribed as soon as possible after the date of enactment of
promote. It is the purpose of this Act to require that financial institu-
this Act, but in no event later than the effective date of this Act.
tions and other firms engaged in the extension of credit make that credit
"§ 704. Administrative enforcement
equally available to all creditworthy customers without regard to sex
"(a) Compliance with the requirements imposed under this title 15 USC 16916.
or marital status.
shall be enforced under:
§ 503. Amendment to the Consumer Credit Protection Act
"(1) Section 8 of the Federal Deposit Insurance Act, in the 15 USC 1814.
15 USC 1601
The Consumer Credit Protection Act (Public Law 90-321), is
case of-
note.
amended by adding at the end thereof a new title VII:
'(A) national banks, by the Comptroller of the Currency,
'(B) member banks of the Federal Reserve System (other
"TITLE VII-EQUAL CREDIT OPPORTUNITY
than national banks), by the Board,
"(C) banks insured by the Federal Deposit Insurance
"Sec.
"701. Prohibited discrimination.
Corporation (other than members of the Federal Reserve
"702. Definitions.
System), by the Board of Directors of the Federal Deposit
"703. Regulations.
Insurance Corporation.
"704. Administrative enforcement.
(2) Section 5(d) of the Home Owners' Loan Act of 1933, 12 USC 1464.
"705. Relation to State laws.
section 407 of the National Housing Act, and sections 6(i) and
12
USC
1730.
"706. Civil liability.
"707. Effective date.
17 of the Federal Home Loan Bank Act, by the Federal Home
12 USC 1426,
"§ 701. Prohibited discrimination
Loan Bank Board (acting directly or through the Federal Sav-
1437.
ings and Loan Insurance Corporation), in the case of any insti-
15 USC 1691.
(a) It shall be unlawful for any creditor to discriminate against
tution subject to any of those provisions.
any applicant on the basis of sex or marital status with respect to any
(3) The Federal Credit Union Act, by the Administrator of
12 USC 1751.
aspect of a credit transaction.
the National Credit Union Administration with respect to any
(b) An inquiry of marital status shall not constitute discrimination
Federal Credit Union.
for purposes of this title if such inquiry is for the purpose of ascer-
Pub. Law 93-495
- 24 -
October 28, 1974
88 STAT. 1523
October 28, 1974
- 25 -
Pub. Law 93-495
88 STAT. 1524
"(4) The Acts to regulate commerce, by the Interstate Com-
merce Commission with respect to any common carrier subject to
status into account in connection with the evaluation of creditworthi-
those Acts.
ness of any applicant.
49 USC 1301
"(5) The Federal Aviation Act of 1958, by the Civil Aero-
"(b) Consideration or application of State property laws directly
note.
nautics Board with respect to any air carrier or foreign air carrier
or indirectly affecting creditworthiness shall not constitute discrimina-
subject to that Act.
tion for purposes of this title.
7 USC 181
'(6) The Packers and Stockyards Act, 1921 (except as provided
"(c) Any provision of State law which prohibits the separate
note.
in section 406 of that Act), by the Secretary of Agriculture with
extension of consumer credit to each party to a marriage shall not
7 USC 226,
respect to any activities subject to that Act.
apply in any case where each party to a marriage voluntarily applies
227.
(7) The Farm Credit Act of 1971, by the Farm Credit Admin-
for separate credit from the same creditor: Provided, That in any case
12 USC 2001
where such a State law is SO preempted, each party to the marriage
note.
istration with respect to any Federal land bank, Federal land
bank association, Federal intermediate credit bank, and produc-
shall be solely responsible for the debt SO contracted.
tion credit association;
"(d) When each party to a marriage separately and voluntarily
15 USC 78a.
"(8) The Securities Exchange Act of 1934, by the Securities
applies for and obtains separate credit accounts with the same
and Exchange Commission with respect to brokers and dealers;
creditor, those accounts shall not be aggregated or otherwise com-
and
bined for purposes of determining permissible finance charges or
15 USC 661
"(9) The Small Business Investment Act of 1958, by the Small
permissible loan ceilings under the laws of any State or of the United
note.
Business Administration, with respect to small business invest-
States.
ment companies.
"(e) Except as otherwise provided in this title, the applicant shall
(b) For the purpose of the exercise by any agency referred to in
have the option of pursuing remedies under the provisions of this title
subsection (a) of its powers under any Act referred to in that sub-
in lieu of, but not in addition to, the remedies provided by the laws
section, a violation of any requirement imposed under this title shall
of any State or governmental subdivision relating to the prohibition of
be deemed to be a violation of a requirement imposed under that Act.
discrimination on the basis of sex or marital status with respect to
In addition to its powers under any provision of law specifically
any aspect of a credit transaction.
referred to in subsection (a), each of the agencies referred to in that
"§ 706. Civil liability
subsection may exercise for the purpose of enforcing compliance with
"(a) Any creditor who fails to comply with any requirement 15 USC
169le.
any requirement imposed under this title, any other authority con-
imposed under this title shall be liable to the aggrieved applicant in an
ferred on it by law. The exercise of the authorities of any of the
amount equal to the sum of any actual damages sustained by such
agencies referred to in subsection (a) for the purpose of enforcing
applicant acting either in an individual capacity or as a representative
compliance with any requirement imposed under this title shall in
of a class.
no way preclude the exercise of such authorities for the purpose of
"(b) Any creditor who fails to comply with any requirement
enforcing compliance with any other provision of law not relating
imposed under this title shall be liable to the aggrieved applicant for
to the prohibition of discrimination on the basis of sex or marital
punitive damages in an amount not greater than $10,000, as determined
status with respect to any aspect of a credit transaction.
by the court, in addition to any actual damages provided in section
"(c) Except to the extent that enforcement of the requirements
706(a) Provided, however, That in pursuing the recovery allowed
imposed under this title is specifically committed to some other Gov-
under this subsection, the applicant may proceed only in an individual
ernment agency under subsection (a), the Federal Trade Commission
capacity and not as a representative of a class.
shall enforce such requirements. For the purpose of the exercise by
(c) Section 706(b) notwithstanding, any creditor who fails to
the Federal Trade Commission of its functions and powers under the
Federal Trade Commission Act, a violation of any requirement
comply with any requirement imposed under this title may be liable
for punitive damages in the case of a class action in such amount as
imposed under this title shall be deemed a violation of a requirement
the court may allow, except that as to each member of the class no
imposed under that Act. All of the functions and powers of the Fed-
eral Trade Commission under the Federal Trade Commission Act are
minimum recovery shall be applicable, and the total recovery in such
available to the Commission to enforce compliance by any person with
action shall not exceed the lesser of $100,000 or 1 percent of the net
the requirements imposed under this title, irrespective of whether that
worth of the creditor. In determining the amount of award in any
person is engaged in commerce or meets any other jurisdictional tests
class action, the court shall consider, among other relevant factors, the
15 USC 58.
in the Federal Trade Commission Act.
amount of any actual damages awarded, the frequency and persistence
"(d) The authority of the Board to issue regulations under this title
of failures of compliance by the creditor, the resources of the creditor,
does not impair the authority of any other agency designated in this
the number of persons adversely affected, and the extent to which
section to make rules respecting its own procedures in enforcing com-
the creditor's failure of compliance was intentional.
pliance with requirements imposed under this title.
'(d) When a creditor fails to comply with any requirement imposed
under this title, an aggrieved applicant may institute a civil action for
"§ 705. Relation to State laws
preventive relief, including an application for a permanent or tempo-
15 USC 1691d.
"(a) A request for the signature of both parties to a marriage for
rary injunction, restraining order, or other action.
the purpose of creating a valid lien, passing clear title, waiving
(e) In the case of any successful action to enforce the foregoing
inchoate rights to property, or assigning earnings, shall not constitute
liability, the costs of the action, together with a reasonable attorney's
discrimination under this title: Provided, however, That this pro-
fee as determined by the court shall be added to any damages awarded
vision shall not be construed to permit a creditor to take sex or marital
by the court under the provisions of subsections (a), (b), and (c)
of this section.
"(f) No provision of this title imposing anv liability shall apply
to any act done or omitted in good faith in conformity with any rule,
Pub. Law 93-495
- 26 -
October 28, 1974
October 28, 1974
- 27 -
Pub. Law 93-495
88 STAT. 1525
88 STAT. 1526
regulation, or interpretation thereof by the Board, notwithstanding
money order, traveler's check, or similar written instrument was
that after such act or omission has occurred, such rule, regulation, or
purchased, that State shall be entitled exclusively to escheat or
interpretation is amended, rescinded, or determined by judicial or
take custody of the sum payable on such instrument, to the extent
other authority to be invalid for any reason.
of that State's power under its own laws to escheat or take custody
"(g) Without regard to the amount in controversy, any action under
of such sum;
this title may be brought in any United States district court, or in
(2) if the books and records of such banking or financial orga-
any other court of competent jurisdiction, within one year from the
nization or business association do not show the State in which
date of the occurrence of the violation.
such money order, traveler's check, or similar written instrument
"§ 707. Effective date
was purchased, the State in which the banking or financial
15 USC 1691
"This title takes effect upon the expiration of one year after the
organization or business association has its principal place of
note.
date of its enactment.".
business shall be entitled to escheat or take custody of the sum
payable on such money order, traveler's check, or similar written
instrument, to the extent of that State's power under its own laws
TITLE VI-DISPOSITION OF ABANDONED MONEY
to escheat or take custody of such sum, until another State shall
ORDERS AND TRAVELER'S CHECKS
demonstrate by written evidence that it is the State of purchase;
or
FINDINGS
(3) if the books and records of such banking or financial orga-
nizations or business association show the State in which such
12 USC 2501.
SEC. 601. The Congress finds and declares that—
money order, traveler's check, or similar written instrument was
(1) the books and records of banking and financial organiza-
purchased and the laws of the State of purchase do not provide
tions and business associations engaged in issuing and selling
for the escheat or custodial taking of the sum payable on such
money orders and traveler's checks do not, as a matter of business
instrument, the State in which the banking or financial organi-
practice, show the last known addresses of purchasers of such
zation or business association has its principal place of business
instruments;
shall be entitled to escheat or take custody of the sum payable
(2) a substantial majority of such purchasers reside in the
on such money order, traveler's check, or similar written instru-
States where such instruments are purchased;
ment, to the extent of that State's power under its own laws to
(3) the States wherein the purchasers of money orders and
escheat or take custody of such sum, subject to the right of the
traveler's checks reside should, as a matter of equity among the
State of purchase to recover such sum from the State of principal
several States, be entitled to the proceeds of such instruments in
place of business if and when the law of the State of purchase
the event of abandonment;
makes provision for escheat or custodial taking of such sum.
(4) it is a burden on interstate commerce that the proceeds of
such instruments are not being distributed to the States entitled
APPLICABILITY
thereto; and
(5) the cost of maintaining and retrieving addresses of pur-
SEC. 604. This title shall be applicable to sums payable on money 12 USC 2501
chasers of money orders and traveler's checks is an additional
orders, traveler's checks, and similar written instruments deemed note.
burden on interstate commerce since it has been determined that
abandoned on or after February 1, 1965, except to the extent that
most purchasers reside in the State of purchase of such instru-
such sums have been paid over to a State prior to January 1, 1974.
ments.
Approved October 28, 1974.
DEFINITIONS
12 USC 2502.
SEC. 602. As used in this title-
(1) "banking organization" means any bank, trust company,
savings bank, safe deposit company, or a private banker engaged
in business in the United States;
(2) "business association" means any corporation (other than
a public corporation), joint stock company, business trust, partner-
ship, or any association for business purposes of two or more
individuals; and
LEGISLATIVE HISTORY:
(3) "financial organization" means any savings and loan asso-
ciation, building and loan association, credit union, or investment
HOUSE REPORTS: No. 93-751 (Comm. on Banking and Currency)
company engaged in business in the United States.
and No. 93-1429 (Comm. of Conference).
SENATE REPORT No. 93-902 (Comm. on Banking, Housing and Urban Affairs).
CONGRESSIONAL RECORD, Vol. 120 (1974):
STATE ENTITLED TO ESCHEAT OR TAKE CUSTODY
Feb. 5, considered and passed House.
June 13, considered and passed Senate, amended.
12 USC 2503.
SEC: 603. Where any sum is payable on a money order, traveler's
Oct. 9, House agreed to conference report.
check, or other similar written instrument (other than a third party
Oct. 10, Senate agreed to conference report.
bank check) on which a banking or financial organization or a busi-
ness association is directly liable-
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 10, No. 44:
(1) if the books and records of such banking or financial
Oct. 29, Presidential statement.
organization or business association show the State in which such
not comm
Electronic
Frends
Tuesday 12/3/74
Transfer
9:34 Charlie Joyce called concerning the National Commission on
Electronic Funds Transfer, which was established by a
bill (H. R. 11221), which the President signed on October 28.
(See attached note of previous call from George Glaser,
which Charlie took care of for us.)
Charlie has never received a letter from Glaser, which
Glaser said he would be writing to the President, with a copy
to you and a copy to Charlie Joyce.
Charlie has had calls from many computer people to ask how
to make inputs. He doesn't know what to tell them or who
to contact.
I checked again with our Records section, and they now have
copies of the bill, which they will send over.
(Copy now attached)
ВЕРАЦО FORD LIBRANT
Glaser
George
Tuesday 11/12/74
4:10 Returned George Glaser's call of yesterday to Mr. Buchen.
(415) 342-4133
Mr. Glaser is the President of AFIPS
He said they had seen the recent announcement of the Presidential
commission National on electronic funds transfer. (about a week ago)
(Now a Commission on electronic fund transfers. The AFIPS
Board of Directors discussed this the other day; they have a fund
transfer project and are in touch with the Federal Reserve. The
Board passed a resolution urging the President to include in appointments
by the President to this Commission one or more technical persons.
There is no one designated now for the Commission who comes from a
computer related agency. There are however five positions on the
Commission to be appointed as representatives of the private sector. He said:
"We were hoping that we could urge the President to put someone who knows about
computers on the Commission. " I suggested possibly writing a letter to
Mr. Buchen -- and suggested I would check with Charlie Joyce first.
Checked wi th Charlie Joyce and he is familiar with the bill and would
talk with Mr. Glaser if he called. Said there is indeed a bill --
H. R. 11221, an act to increase deposit insurance to establish
-----
electronic fund transfers.
Wasn't sure it was signed.
Called Jerry Jones' office who said the bill was signed by the President
on October 28.
Checked with Tom Jones for a copy; they advise GPO is more than a
week behind on printing so it may be another week before we get a copy.
Gave Charlie Joyce the bill number and the date of signing; he said
he would talk to Glaser. Glaser talked with him and will write a
letter to the President, witha copy to Mr. Buchen and Mr. Joyce.
When Glaser comes to town within the near future, he will meet
with Mr. Joyce.
FORD is LIBRARY GERALD
December 6, 1974
MEMORANDUM FOR:
Bill Walker
FROM:
Philip Buchen
SUBJECT:
National Commission on Electronic
Fund Transfers
Attached is a letter from Willis H. Ware of the Rand
Corporation, expressing some thoughts about appointments
to be made to this Commission.
I think he has made a valid point that the data processing
people should be represented. Also, as you may remember,
Vice President Ford made a major address on the right of
privacy to the national meeting of the American Federation
of Information Processing Societies in Chicago during the
month of May 1974. At that time he assured the groups
involved in that convention that he was concerned to have their
strong interest in the right of privacy reflected within the
Federal government on all matters substantially affecting
informational privacy. Certainly the use of electronic fund
transfer systems would have such an effect.
Attachment
PWBuchen:ed
FORD it LIBRARY 938470
1
25th
Year
Rand
SANTA MONICA, 90406
WILLIS H. WARE
Corporate Research Staff
December 2, 1974
Mr. Philip Buchen
General Counsel to the President
The White House
Washington, D. C. 20500
Dear Phil:
I'd like to make the following suggestion to you
privately. I've seen recent publicity concerning
the National Commission to Study the Electronic
Fund Transfer System. I'd like to express the
following view on it -- which maybe you've heard
from me before.
To me, the EFTS proposal by the banking industry
is another example of a major decision with intense
societal impact that is being made by an industry
for its own expedience and convenience, but without
adequate consideration of the implications for soci-
ety and individuals. The information that I have
seen on the Commission tends to support this view
in that it would appear the Commission will be pop-
ulated largely by members of the banking and other
financial institutions. I do not see any suggestion,
for example, that the group will include social
psychologists, sociologists, or even data processing
people who, as you know, are very concerned about
the civil libertarian and privacy consequences of
something like an EFTS.
I would ask that you use your good offices to help
assure that the Commission reflects a balanced group
of people that will produce a study that looks ade-
quately at all aspects of the proposal rather than
one that simply looks at the positive attributes of
it as seen from the vantage point of the country's
financial industry. If you would like suggestions
for possible participants from the data processingo
community, I might suggest that you contact Dr
George
THE RA ND CORPORATION, 1700 MAIN STREET, SANTA MONICA, CALIFORNIA 90406, PHONE: (213) 393-0411
Mr. Philip Buchen
Page Two
December 2, 1974
Glaser at 225 Warren Road, San Mateo, California
94402, whom you met for the first time at lunch
with me last May in Chicago. Dr. Glaser is cur-
rently President of the American Federation of
Information Processing Societies which, as you know,
is the major spokesman in this country for the com-
puter people.
I continue to see Doug Metz and Carole Parsons and
David Martin at frequent intervals, so I'm well
up to date on developments on the privacy front.
Let's hope things go through smoothly before the end
of the year.
Sincerely,
Willis
Willis H. Ware
Corporate Research
Staff
WHW:ph
SERALD FORD LIBRARY
not Comm. on
Electing Friends
alips memo
Transfers
George Glaser
Dec. 12,1974
Phil-
We talked after my letter to
you had been typed so I'm sending
conversation. it primasily as a reminder of out
is directed to the attention of
my letter to the President
Mr. Halker as you suggested.
We have four candidates
to recommend if we are asked;
one of them is me. But any one
of us would be able to offer and
business a experience that we believe
combination of technical
could be helpful
again, many thanks for your George help.
FORD is LIBRARY GERALD
of information Processing
alips
forma
94402
December 12, 1974
Mr. Philip W. Buchen
General Counsel to the President
The White House
Washington, D. C. 20500
Dear Phil:
The attached letter to the President
conveys the substance of a resolution passed by
the AFIPS Board of Directors concerning the National
Commission on Electronic Fund Transfers. I'm sending
you a copy because I would be very grateful for any
assistance you might give us in seeing that the
proper individual on the President's staff is aware
of our offer to help and our request that someone
with a background in computer and communications
technologies be appointed to the Commission.
In particular, we would welcome the opportunity to
suggest several candidates from private life for
appointment to the Commission, if that would be
helpful.
At the suggestion of Mrs. Daughtrey of
your staff, I also am sending a copy of the attached
letter to Mr. Charles C. Joyce in the Office of
Telecommunications Policy. I have alerted Mr. Joyce
that our letter was forthcoming and, although he
obviously could not guarantee that the President
would accept our suggestion, he did indicate that
he would follow up on our letter upon its arrival
at the White House.
I very much appreciate any assistance you
might give us and I look forward to seeing you again.
Best of luck with your new duties.
Sincerely,
George George Claser
BERALD FORD LIBRARY
enclosures
December 12, 1974
The President
The White House
Washington, D. C. 20500
Mr. President:
Last May, you addressed AFIPS' National
Computer Conference in Chicago on the mission of the
Domestic Council Committee on the Right of Privacy.
We enjoyed that occasion very much and were honored
by your presence.
You will recall that in your Chicago speech
you invited AFIPS and its Constituent Societies to
become involved in the work of the Domestic Council
Committee on the Right of Privacy. We accepted
your invitation and subsequently began a dialogue
with Philip Buchen while he served as Executive
Director of the Committee; that dialogue has continued
with his successor. Mr. Buchen has expressed his
appreciation for our help; we, in turn, are most
grateful for the opportunity you gave us.
As the leading professional society in the
information processing industry, AFIPS would now like
to offer its assistance to you in the work of the
National Commission on Electronic Fund Transfers. To
this end, our Board of Directors has passed a resolu-
tion (copy attached) expressing its recognition of
the importance of the issues surrounding fund transfers
and pledging its assistance in whatever fashion you
deem most appropriate. The Board also respectfully
urges you to appoint to the Commission one or more
individuals from private life who have an understanding
of computer and communications technologies and their
potential economic and social consequences. We do
so because we believe that the Commission will be
faced with a number of complex technical issues
FORD
GERALD
LIBRAR
- 2 -
during the course of its deliberations, and that it
could function most effectively if individuals with
the appropriate technical backgrounds were included
among its members.
Should we be invited, we would be pleased
to suggest candidates from among the nearly 100,000
professional members of our fifteen Constituent
Societies.
Respectfully yours,
George Glaser
FORD is LIBRARY
AMERICAN FEDERATION OF
INFORMATION PROCESSING SOCIETIES, INC.
November 8, 1974
RESOLVED by the Board of Directors: that the
American Federation of Information Processing Societies,
Inc. :
1) believes that the matters to be considered
and acted upon by the National Commission on
Electronic Fund Transfers are of major im-
portance to American society and the world;
2) pledges its assistance to the Commission
in whatever fashion is most appropriate to
intelligent and effective action; and
3) urges the President of the United States to
include in his appointments from private
life to the Commission one or more individuals
who have an understanding of computer and
communications technologies and their
potential economic and social consequences.
FORD it LIBRARY GERALD
December 12, 1974
Mr. Charles C. Joyce, Jr.
Assistant Director for Governmental
Communications
Office of Telecommunications Policy
1800 G Street, N.W.
Washington, D. C. 20504
Dear Mr. Joyce:
Several weeks ago, we discussed the fact
that I would be writing to the President to convey
a resolution passed by the AFIPS Board of Directors
offering to help in the work of the National
Commission on Electronic Fund Transfers, and urging
the President to appoint to the Commission one or
more individuals from private life who have back-
grounds in computer and communications technologies.
A copy of that letter is attached. I would sincerely
appreciate any assistance you might give us in seeing
that it comes to the attention of the appropriate
member of the President's staff.
I also have sent a copy to Mr. Philip
Buchen who, as former Executive Director of the
Domestic Council Committee on the Right of Privacy,
has had some recent experience in working with
AFIPS volunteers. Should you have any questions
about that experience, I hope you will contact him.
I also am enclosing a copy of a brochure
that will give you some idea of the breadth and
depth of technical specialties represented among
our members. Although the brochure is a recent
one, it is already out of date; the Data Processing
Management Association and the Institute of Internal
FORD i LIBRARY QERALD
- 2 -
Auditors have joined AFIPS since the brochure was
printed.
Please call me if you wish to suggest
any further action we might take. We are very
grateful for your help.
Sincerely,
George Glaser
enclosure
cc: Philip W. Buchen
FORD : LIBRARY GERALD
Dec. 18, 1974
EF is
To:
Bill Walker
From:
Phil Buchen
FORD i LIBRARY
year
Willis
Rand
SANTA MONICA, CA.90406
WILLIS H. WARE
Corporate Research Staff
December 11, 1974
Mr. Philip Buchen
General Counsel to the President
The White House
Washington, D. C. 20500
Dear Phil:
I thought about trying to reach you by phone, but
decided against it because I know your schedule
must approximate the impossible. I'd like to give
you another suggestion with regard to the EFTS
Commission.
As I quickly learned from the HEW Committee activity,
a very competent and efficient Executive Secretary
is an absolute must on a committee exercise of any
substantial size. The EFTS Commission will just have
to be supported by a very capable secretariat or it
will very quickly bog down in nitty-gritty details.
I know none of that is news to you. In this con-
nection, I would like to recommend to you David
B. H. Martin as a very thorough and efficient person
for the EFTS Commission Executive Secretary. I
understand from talking with David recently that he
will be leaving HEW about the first of the year; and
from his point of view, therefore, the timing would
be very convenient.
I have enclosed for your information a biographical
data sheet on him, and it speaks for itself. However,
I would like to emphasize some of the strong points
that I personally found in David's performance for
the HEW group. First of all, he was very thorough
and aggressive in seeking out individuals and organ-
izations that had points of view to be presented to
the group. Secondly, he performed very heroically
during a trying period for the Committee when it was
running essentially without a Chairperson. Third,
and very importantly from my point of view, when it
came time to construct the final report, I found FORD
RALD
LIBRARI
THE RAND CORPORATION, 1700 MAIN STREET, SANTA MONICA, CALIFORNIA 90406, PHONE: (21) 393-0411
Mr. Philip Buchen
December 11, 1974
Page Two
David to be a very effective person, not only in
contributing to the substance of the report, but
also in actually writing the material. At the
peak of our activity, he was coordinating and
managing a group of probably half a dozen individ-
uals, each of whom was writing various sections
and appendices for our book. As you will note
from his biography, his background is very well
suited to a task such as the EFTS Commission.
Because of his service in various legislative
posts, he is very familiar with government opera-
tions and with the political overlay that controls
how things are done. As a result of his tour of
duty at HEW, he has become very keenly tuned to
the social implications and consequences of tech-
nology, especially computer-based technology. As
you know, I regard this as an essential component
of the EFTS examination. While his exposure to
the financial community is minimal, I would argue
this is an attribute because one can then look at
the situation without the traditional and historic
blinders of an individual steeped in the business.
As you can tell from my comments, my recommenda-
tion of David Martin for the EFTS Secretariat is
without reservation and as strong as I can pos-
sibly convey in words. If it would be helpful,
I would be glad to discuss this further as you
might require.
I'll take this opportunity to wish you and your
family the finest of Christmas holidays and the
best success in your many undertakings for the
New Year.
Sincerely,
Wells
Willis H. Ware
Corporate Research
Staff
QERMLO FORD LIBRARY
WHW:ph
Biographical Data
David B. H. Martin, Esq.
Permanent Address:
Current Address:
94 Blake Road
3620 Prospect Street, N.W.
Hamden, Connecticut 06517
Washington, D.C. 20007
Born: Danbury, Connecticut, August 14, 1925
Education: Graduated from The Buckley School, New York
City, in 1939; St. Paul's School, Concord, New Hampshire
in 1942; Yale College (B.A.) in 1947 (Class of 1945W) ;
Harvard Law School (L.L.B.) in June, 1949.
Employment: July, 1970 to January, 1975: Special Assistant
to the Secretary of Health, Education, and Welfare: also
Executive Director of the Secretary's Advisory Committee
on Automated Personal Data Systems (March 1972-August,
1973); and Director, Fair Information Practice Staff of
DHEW (February, 1974-November, 1974).
March, 1970 - July, 1970: Senior Consultant and Acting
Deputy Director, Urban Law Institute, The National Law
Center, The George Washington University, Washington, D.C.
November, 1968 - December, 1969: Executive Director,
Commonwealth of Massachusetts Housing Finance Agency.
July, 1966 - November, 1968: Director of Governmental
Relations, Office of University Development, Yale University.
July, 1961 - June, 1966: Special Assistant to the Provost
and to the President (for Governmental Relations), Yale
University.
1959 - 1961: Special Assistant to the Assistant Secretary
for Legislation, U.S. Department of Health, Education, and
Welfare, Washington, D.C. Elliot L. Richardson, Robert A.
Forsythe, and Wilbur Cohen were the Assistant Secretaries
with whom I worked.
1958 - 1959: Legislative Assistant to U.S. Senator
Leverett Saltonstall (R-Mass.), Washington, D.C.
1949 - 1958: Associated in general law practice with the
firm of Peabody, Brown, Rowley and Storey, Boston, Mass.
FORD & LIBRARY GERALD
Public service activities:
During years in private law practice (1949-1958), spent
much time rendering legal services to Massachusetts towns
for which law firm served as Town Counsel. Also was active
in taxpayers associations and the Massachusetts Federation
of Taxpayers Associations.
Author of legislation for Governor Christian A. Herter
(1956) creating the Massachusetts Higher Education Assistance
Corporation, whose Higher Education Loan Plan was established
as the first arrangement for guaranteeing bank loans to
college students and subsequently widely imitated by other
States, by United Student Aid Funds, Inc., and ultimately
by the U.S. Office of Education in the Federal Insured Loan
Program, Served as Counsel and Secretary of the Corporation,
1957-1959.
One of the principal authors and the principal draftsman
of the legislation establishing the Cape Cod National
Seashore (1961). This legislation established new principles
which have seen further application in subsequent national
seashore legislation for Pt. Reyes, California, Padre Island,
Texas, et al.
Conceived and helped to develop College and University
Reports, published since 1965 by Commerce Clearing House, Inc.
which furnishes comprehensive information on Federal govern-
ment programs affecting higher education interests. Served
from 1965 through 1968 as a member of its Advisory Editorial
Board.
Author of legislation establishing three new State agen-
cies in Connecticut: Connecticut Research Commission (1965) ;
Connecticut Commission on Aid to Higher Education (1967) ;
Connecticut Health and Educational Facilities Authority
(1965). Served by appointment of Governor John Dempse 23 =
member of each of these agencies from their inception'and also,
by election of its members, as Vice Chairman and Chairman of
the Connecticut Health and Educational Facilities Authority.
Conceived and developed the system for support of college
and university community service programs administered by
the Connecticut Commission on Aid to Higher Education;
directed the preparation and publication of the Commission's
1967 catalogue of Resources of Connecticut Colleges and
Universities for Community Service Programs.
FORD : LIBRARY GERALD
Page 3
December, 1974
Served (1963-1964) as member of the Board of Directors
of Community Progress, Inc. (CPI - New Haven's anti-poverty
community action program agency); also conseived, organized,
and served as Executive Secretary of CPI's Research
Advisory Committee (1965-1967)
Elected member (1968-1969) of the Legislative Council
of Hamden, Connecticut. Served as member of the Council's
Committees on Education-Library; Public Safety, Health and
Welfare; and as Chairman of the Council's Budget Advisory
Committee. In this latter capacity and as Vice Chairman
of the Town's Program Budgeting Advisory Committee, spurred
the design and start of development of a planning-programming-
budgeting system (PPBS) for the Town's general government
budget and for the budget of the Board of Education.
Served in 1969 as a member of Massachasetts Governor
Francis W. Sargent's ad hoc committee for the U.S. Depart-
ment of Housing and Urban Development's Operation Break-
through. Developed legislative specifications for imple-
mentation of Operation Breakthrough in Massachusetts at the
State, regional, and municipal levels.
Served under the Connecticut Municipal Employees Relations
Act, from its enactment in 1965 through 1968, as a Fact
Finder-Mediator for the Connecticut Board of Mediation and
Arbitration to settle labor disputes involving employees of
Connecticut cities and towns.
Helped to conceive, organize, and carry out the Women's
Action Program of DHEW (1971-1972) ; co-aithor of its first
report (January, 1972) to the Secretary of HEW.
Conceived, organized, and directed the work of the
Secretary (of HEW) 's Advisory Committee on Automated Personal
Data Systems; co-author of its report, Records, Computers, and the
Rights of Citizens (July, 1973). Have provided advice and
drafting assistance regarding Federal and State legislation
and regulations that have grown out of the recommendations
of the report. Have written journal articles, papers,
speeches, legislative testimony, and given presentations
regarding issues and initiatives in thefields of privacy
rights, record-keeping practice, and information law and
policy (1972-1974).
BERALD FORD LIBRARY
Page 4
December, 1974
Developed the conceptual framework and plan for the con-
duct of a major study of the administration of the Freedom
of Information Act proposed by Attorney General Elliot L.
Richardson (1973). (Due to unforeseen circumstances, the
study was not undertaken.)
U.S. Participant at Seminar on Human Rights and Scien-
tific and Technological Developments organized by the United
Nations Division of Human Rights in co-operation with the
Government of Austria. Vienna, Austria, 19 June-1 July,
1972.
Co-author (with Alan F. Westin and Daniel H. Lufkin) of
The Impact of Computer-Based Information Systems on Citizen
Liberties in the Advanced Industrial Nations: A Report for
the German Marshall Fund of the United States (September,
1973, unpublished).
U.S. Delegate to 6th and 7th Sessions of the Data Bank
Panel, Computer Utilization Group, Directorate for Scientific
Affairs, Organization for Economic Cooperation and Development
(O.E.C.D.). Paris, France, 11-12 September 1973; 27 June, 1974.
Delivered invited paper as participant at Seminar on
Policy Issues in Data Protection - Concepts and Perspectives
organized by Computer Utilization Group, Directorate for
Scientific Affairs, Organization for Economic Cooperation
and Development (O.E.C.D.). Paris, France, 24-26 June, 1974.
Miscellaneous:
Admitted to practice law before Massachusetts Supreme
Judicial Court, U.S. District Court for the District of
Massachusetts, U.S. District Court for the District of
Columbia, U.S. Supreme Court, U.S. Court of Military Appeals,
National Labor Relations Board, Federal Communications Com-
mission, Civil Aeronautics Board.
Served in U.S. Naval Reserve in World War II, including
service as Communications Officer on the destroyer, USS
KILLEN. Served in Organized U.S. Naval Reserve from 1947
to 1952; discharged as Lisutenant (Senior Grade).
Have been an active member and officer of numerous profes-
sional and community organizations.
BERALD FORD LIBRARY
Electronic
Tunds
February 5, 1975
Transfer
Operations
MEMORANDUM FOR:
WILLIAM WALKER
FROM:
PHILIP BUCHEN
Please see attached recommendation for appoint-
ment of Dick Francis to the Commission on
Electronic Funds Transfer Operations.
Attachment
PWBuchen:sk 2/6/75
TURD i LIBRARY QERALD
February 6, 1975
Mr. Harry Calcutt
Attorney and Counselor
State Bank Building
Traverse City, Michigan 49684
Dear Harry:
Thank you very much for your letter concerning the
qualifications of Dick Francis for appointment to
the Presidential Commission on Electronic Funds
Transfer Operations.
I have sent a copy of your letter to the Director,
Office of Presidential Appointments so that recom-
mendation of Mr. Francis can be added to the others
who favor this appointment.
I became interested in this subject when I was working
on the staff of the Vice President's Committee on the
Right of Privacy, but since August I have had little
time to pursue developments in this area.
I look forward to seeing you again when I return to
Michigan and I an sending my best regards,
Sincerely,
Philip W. Buchen
Counsel to the President
CC: Mr. William Walker
PWBuchen:sk 2/6/75
FORD LIBRARY is DERALD
MURCHIE, CALCUTT & SONDEE
ATTORNEYS AND COUNSELORS
STATE BANK BUILDING
TRAVERSE CITY, MICHIGAN 49684
AREA CODE 616 947-7190
ROBERT B. MURCHIE
January 15, 1975
MANISTEE OFFICE
HARRY CALCUTT
325 FIRST STREET
RONALD W. SONDEE
MANISTEE. MICHIGAN 49650
AREA CODE 616 723-4521
KRIS A. VAN THIELEN
JACK E. BOYNTON
PERSONAL PLEASE FORWARD
Mr. Philip W. Buchen
Buchen, Weathers, Richardson & Dutcher
740 Old Kent Building
Grand Rapids, Michigan 49502
Re:
Presidential Commission on Electronic
Funds Transfer Operations
Dear Phil:
This is directed to you as the result of your proximity to the throne
and with the hope that you will see that it goes in the right pigeonhole or
even give the matter a nudge if it seems appropriate. Incidentally, it gives
all of us in the Middlewest a great deal of reassurance to know that the Wash-
ington directions are designed to some extent by Michigan lawyers. Perhaps
this minor matter fits in some category under your jurisdiction.
The point of my request is the prospective appointments of twenty
or thirty people from the financial industry to a Commission to study the mat-
ter of the electronic transfer of funds and its impact on the banking system.
I believe that the study is instigated by the possibilities of the use of credit
card type documents to be issued by banks which will provide instant credit
or deposits through electronic media to be situated in supermarkets and similar
locations.
While I was in Lansing the other day on a banking matter, I had
dinner with my friend, Dick Francis, who is now the Financial Institutions
Commissioner for the State of Michigan (responsible for the savings and loan
industry, the banking industry, and credit unions). I've known Dick as the
result of his service as General Counsel and Vice President of Michigan Life
Insurance Company during the last ten or fifteen years in which I've served on
the Board of Directors of that company. When Michigan was in need of an
GERALD FORD LIBRARY
Insurance Commissioner I recommended Dick Francis to Bill Milliken for that
job, but Bill in his wisdom had seen fit to fill the Commissioner offices from
people outside the industry affected rather than within the industry. As a
result he utilized Dick Francis' services as the Financial Institutions head,
rather than in the insurance field.
Dick Francis has devoted a great deal of study to an area in which
he was ill-informed when he took office. He recently made a good decision
on a tough issue involving the so-called loan-production offices of the Mich-
igan National Bank in which he catagorized them as branches and thus subject
to control, rather than a non-branch office. His decisions in that regard and
other matters have been complimented recently in an article appearing in the
American Banker, a national industry publication. He's been a student of,
and is interested in the problems of electronic transfer of funds, and his
appointment to the Presidential Commission would be useful to the public and
fits in his framework of interest.
If there's anything you can-do to-help in regard to such an appoint-
ment, I'd be most grateful and I'm sure he would. I know personally that he's
favored for such an appointment by both the savings and loan and the banking
industries in Michigan, each of which will be affected. Look forward to a
visit with you when you come home. Best regards.
Sincerely,
Harry Calcutt Calcute
HC:db
GERAALO FORD LIBRARY
-2-
EF EFTS
February 6, 1975
Mr. Harry Calcutt
Attorney and Counselor
State Bank Building
Traverse City, Michigan 49684
Dear Harry:
Thank you very much for your letter concerning the
qualifications of Dick Francis for appointment to
the Presidential Commission on Electronic Funds
Transfer Operations.
I have sent a copy of your letter to the Director,
Office of Presidential Appointments so that recom-
mendation of Mr. Francis can be added to the others
who favor this appointment.
I became interested in this subject when I was working
on the staff of the Vice President's Committee on the
Right of Privacy, but since August I have had little
time to pursue developments in this area.
I look forward to seeing you again when I return to
Michigan and I am sending my best regards,
Sincerely,
Philip W. Buchen
Counsel to the President
CC: Mr. William Walker
PWBuchen:sk 2/6/75
GERALD LIBRARY ? FORD
Fredue, Date
EF EFTS
THE WHITE HOUSE
WASHINGTON
February 6, 1975
MEMORANDUM FOR:
WILLIAM WALKER
FROM:
PHILIP BUCHEN IW.B.
Please see attached recommendation for appoint-
ment of Dick Francis to the Commission on
Electronic Funds Transfer Operations
Attachment
FORD LIBRARA
MURCHIE, CALCUTT & SONDEE
ATTORNEYS AND COUNSELORS
STATE BANK BUILDING
TRAVERSE CITY, MICHIGAN 49684
AREA CODE 616 947-7190
ROBERT B. MURCHIE
January 15, 1975
MANISTEE OFFICE
325 FIRST STREET
HARRY CALCUTT
MANISTEE. MICHIGAN 49660
RONALD W. SONDEE
AREA CODE 616 723-4321
KRIS A VAN THIELEN
JACK E BOYNTON
PERSONAL -- PLEASE FORWARD
Mr. Philip W. Buchen
Buchen, Weathers, Richardson & Dutcher
740 Old Kent Building
Grand Rapids, Michigan 49502
Re:
Presidential Commission on Electronic
Funds Transfer Operations
Dear Phil:
This is directed to you as the result of your proximity to the throne
and with the hope that you will see that it goes in the right pigeonhole or
even give the matter a nudge if it seems appropriate. Incidentally, it gives
all of US in the Middlewest a great deal of reassurance to know that the Wash-
ington directions are designed to some extent by Michigan lawyers. Perhaps
this minor matter fits in some category under your jurisdiction.
The point of my request is the prospective appointments of twenty
or thirty people from the financial industry to a Commission to study the mat-
ter of the electronic transfer of funds and its impact on the banking system.
I believe that the study is instigated by the possibilities of the use of credit
card type documents to be issued by banks which will provide instant credit
or deposits through electronic media to be situated in supermarkets and similar
locations.
While I was in Lansing the other day on a banking matter, I had
dinner with my friend, Dick Francis, who is now the Financial Institutions
Commissioner for the State of Michigan (responsible for the savings and loan
industry, the banking industry, and credit unions). I've known Dick as the
result of his service as General Counsel and Vice President of Michigan Life
Insurance Company during the last ten or fifteen years in which I've served on
the Board of Directors of that company. When Michigan was in need of an
FORD & LIBRARY
Insurance Commissioner I recommended Dick Francis to Bill Milliken for that
job, but Bill in his wisdom had seen fit to fill the Commissioner offices from
people outside the industry affected rather than within the industry. As a
result he utilized Dick Francis' services as the Financial Institutions head,
rather than in the insurance field.
Dick Francis has devoted a great deal of study to an area in which
he was ill-informed when he took office. He recently made a good decision
on a tough issue involving the so-called loan-production offices of the Mich-
igan National Bank in which he catagorized them as branches and thus subject
to control, rather than a non-branch office. His decisions in that regard and
other matters have been complimented recently in an article appearing in the
American Banker, a national industry publication. He's been a student of,
and is interested in the problems of electronic transfer of funds, and his
appointment to the Presidential Commission would be useful to the public and
fits in his framework of interest.
If there's anything you can do to help in regard to such an appoint-
ment, I'd be most grateful and I'm sure he would. I know personally that he's
favored for such an appointment by both the savings and loan and the banking
industries in Michigan, each of which will be affected. Look forward to a
visit with you when you come home. Best regards.
Sincerely,
Harry Calcutt Calcute
HC:db
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