NU Online News Service, Oct. 9, 2003, 12:12 p.m. EST – The U.S. House of Representatives approved a conference report on H.R. 1474 Wednesday by a voice vote.
The bill, the Check Clearing for the 21st Century Act, would let U.S. banks and other U.S. financial institutions clear checks by exchanging checks electronically. The bill preempts state laws that require financial institutions to return checks to the customers who wrote the checks.
Today financial institutions must present and return the original paper checks.
The clearing process now in place is “a tedious and antiquated process with increasing potential for fraud,” House Financial Services Committee Chairman Michael Oxley, R-Findlay, Ohio, says in a statement about the bill. “The current system uses the equivalent of the pony express.”
Rep. Melissa Hart, R-Ellwood City, Pa., introduced H.R. 1474. Banking groups and the Federal Reserve Board have given the bill strong support.
Links to the text of the bill and other information about the bill are on the Web at http://thomas.loc.gov/cgi-bin/bdquery/z?d108:h.r.01474: