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DIRECTIONS
From : Ministry of Finance
Date : January 27,2004
Ref. No. : Tai-Tsai-Rong-(2)-0922001878
Attachment: As described below.
Subject : Financial institutions should comply with the provisions as set out in the explanation, below when handling customers' instructions regarding application of borrowed funds secured by pledges of time deposits and transfers from a customer's demand saving deposit account, consolidated time or demand deposit account or savings account to his/her checking account, the instructions with respect to which are stated on the back of a check or a promissory note issued by the customer mandating a financial institution to pay. Please take note and forward.
Explanation:
1. Customers as mentioned in the subject above shall not be limited to personals Instructions for such fund transfers must be made in writing. The account into which the funds are transferred shall be limited to the customer's own checking account with the instructed financial institution. Instructions shall be made individually and may not be made through a general authorization. However, the above does not apply to amount limited checks or bank guaranteed amount limited checks where the balance is not sufficient to cover the checks and the fund transfer is made from the customer's demand deposit account or saving account.
2. Financial institutions should design the blank for signing/chopping on the back side of a check or a promissory note for fund transfers in a manner which clearly distinguishes such blank from the blank for endorsement so that non-sequential endorsements or re-endorsements can be avoided.
3. The letter from this Ministry, dated of August 7, 2000 (Ref. No.: Tai-Tsai-Jung-89744816) is hereby canceled. |