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FDIC Consumer News - Summer 1998

Important Update: Changes in FDIC Deposit Insurance Coverage

The FDIC deposit insurance rules have undergone a series of changes starting in the fall of 2008. As a result, certain previously published information related to FDIC insurance coverage may not reflect the current rules. For details about the changes, visit Changes in FDIC Deposit Insurance Coverage. For more information about FDIC insurance, go to www.fdic.gov/deposit/deposits/index.html or call toll-free 1-877-ASK-FDIC (1-877-275-3342). For the hearing-impaired, the number is 1-800-925-4618.

Treasury to Encourage, Not Require, Electronic Payment of Federal Benefits

The U.S. Treasury Department has decided to encourage recipients of federal benefit checks to receive their payments electronically, not require them to do so.

Readers of FDIC Consumer News will recall that a 1996 law requires the electronic payment of most Social Security, disability, veterans’ and other federal benefits starting in 1999. Congress passed the law to make payments safer and more reliable because paper checks frequently get lost, stolen or forgotten. Also, it would substantially cut the government’s processing costs. The Treasury, which is responsible for carrying out the law, issued a proposal in September of 1997 that would have required electronic payments in most cases, but would allow people facing certain “hardships” to apply to continue receiving paper checks in the mail.

After hearing from consumer organizations and other groups concerned about a program that mandates electronic payments, the Treasury announced in June it would greatly broaden the waiver categories for people who wish to continue receiving paper checks. Treasury Under Secretary John D. Hawke, Jr., said the final rule will ensure that “recipients are not forced into choices that are not right for them.” The Treasury Department also will conduct a major education campaign emphasizing that no payment will be withheld or delayed because of the new rules, and explaining to recipients their options (including continuing to be paid by paper check).

For more information, contact the Treasury’s Financial Management Service, 401 14th Street, SW, Room 420, Washington, DC 20227, phone (202) 874-6540 or go to the Treasury’s Internet site (www.fms.treas.gov and click on EFT ‘99.)

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Last Updated 08/02/1999 communications@fdic.gov