Circular No. 559 — Amends Rules Governing the Opening, Maintenance, and Closing of Demand Deposit Accounts Operable by Check; Revokes Circular 162 and Circular Letters 50, 68, and 96

CIRCULAR NO. 000559

To
Banking Establishments, Savings Banks, and Credit Cooperatives participating in the Check and Other Papers Clearing Service

We communicate that the Board of this Central Bank, in a session held on this date, resolved to amend the rules governing the opening, maintenance, and closing of demand deposit accounts freely operable by check, currently consolidated in the Manual of Norms and Instructions - MNI 16-9-12-22 to 57:

I - for the opening of demand deposit accounts, it is mandatory to complete a proposal form, which must record:

a) full name and qualification of the depositor, including CPF or CGC;

b) reference sources;

c) agreed deposit conditions;

d) warning that the depositor's name may be included in the Registry of Issuers of Bounced Checks, in case of improper use of checks;

e) signature of the depositor;

f) date of account opening and respective number;

g) dispatch from the branch administrator authorizing the account opening;

h) authorization mentioned in MNI 16-8-1-41, when applicable;

II - the requirement contained in item "a" of the previous item, regarding the inclusion of CPF or CGC in the proposal form, only prevails for natural or legal persons who are, or will become, subject to the obligation to register in the Natural Person Registry or the General Registry of Contributors;

III - the opening of a demand deposit account freely operable by check with the abbreviated name of the depositor is prohibited, unless titled by an individual firm duly registered with the competent authority;

IV - at the bank's convenience, the proposal form may be used as an autograph card;

V - the depositor's autographs must be certified by a natural or legal person considered reputable by the bank, admitting, in the impossibility of certification, the verification of the signature by comparison with that of a valid identification document;

VI - the provision of the first checkbook for the operation of a new account can only be made after the bank has certified the depositor's integrity, having consulted the reference sources and confirmed the veracity of the information contained in the proposal form;

VII - before the provision of the first checkbook, the account must be operated by means of a receipt or by separate, nominative checks, in favor of the issuer themselves;

VIII - the refusal of payment of checks by the drawee bank must be based on one of the following reasons:

a) insufficient funds;

b) discrepancy or insufficiency in the issuer's signature;

c) written counter-order from the issuer;

d) account closed;

e) absence or irregularity of the clearing stamp;

f) formal irregularity or error in completion;

g) improper clearing;

IX - when refusing payment of a check, the drawee bank must:

a) register on the back of the check, in a dated and signed declaration by an authorized employee, the time of presentation, the reason for return, and the existence or not of sufficient funds;

b) if the check is returned due to lack of funds, note the occurrence on the back of the proposal form;

X - the service fee referred to in MNI 3-9-28, equivalent to 3% (three percent) of the highest current reference value - allowing rounding up, for the fraction of cruzeiro - which is charged by the Operator at the time of returning the document to the Clearing House and reverts to the benefit of the Check and Other Papers Clearing Service, applies under the following conditions:

a) at the expense of the drawee bank and transferable to the issuer, when the return of the check results from lack of funds, discrepancy or insufficiency in the signature, written counter-order from the issuer, or closed account;

b) at the expense of the presenting bank and non-transferable to third parties, when the check is returned due to absence or irregularity of the clearing stamp, formal irregularity or error in completion, or improper clearing;

XI - when the return occurs through the Check and Other Papers Clearing Service, in addition to the measures indicated in item IX, the drawee bank fills out, in duplicate, the specific form instituted by the Operator:

a) for the check challenged for the second time, with insufficient funds, which has been re-presented after the minimum interval of two business days, counted from the business day immediately following the day of its first presentation;

b) for the check returned due to a closed account;

XII - the first copy of the form referred to in the previous item is sent to the Operator, in the corresponding return session, for the purpose of including the account holder's name in the Registry of Issuers of Bounced Checks;

XIII - the second copy, accompanied by the returned check, is destined for the remitting bank, which will deliver it to its client. The form must contain the information that the issuer of the challenged check will henceforth appear in the Registry of Issuers of Bounced Checks;

XIV - each occurrence communicated in the manner of items XII and XIII subjects the drawee bank, from 02.01.81, to the payment of a service fee equivalent to 50% (fifty percent) of the highest current reference value, disregarding the fraction of cruzeiro, the collection of which is carried out by the Operator, via debit to its deposit account and only reimbursable to the client if they do not appear in the Registry of Issuers of Bounced Checks;

XV - it is the responsibility of the Operator to monitor, during the return session, compliance with the provisions of items XI to XIII. Any irregularity found will be immediately communicated to the Central Bank by the Operator for the adoption of appropriate administrative procedures;

XVI - the issuer of bounced checks considered habitual, understood as one whose proposal form shows the return of six or more checks under those conditions, within a period of 180 days, will have their name communicated in writing to the Operator by the drawee bank, for inclusion in the Registry of Issuers of Bounced Checks. The failure to take this measure can only be admitted, on an exceptional basis, with a justified explanation to the Central Bank;

XVII - the Registry of Issuers of Bounced Checks will contain the following identifying data, for each occurrence:

a) code number of the bank/branch that commanded the inclusion;

b) check number that gave rise to the record;

c) full name of the account holder;

d) domicile location;

e) CPF or CGC or, in their justified absence, number of identity document;

f) reference number given by the Operator;

XVIII - the Check and Other Papers Clearing Service discloses, every fifteen days, to the banking financial institutions registered in the Service in each Clearing House, the occurrences included in the Registry of Issuers of Bounced Checks in the immediately preceding fifteen-day period. Establishments that require extra quantities of Registry lists, to be distributed to their branches, may obtain them through agreements with the Operator;

XIX - other financial institutions and Credit Protection Services, or similar, legally constituted, registered, and recorded at the Bank of Brazil, also have access to the Registry of Issuers of Bounced Checks, through agreements signed with the Operator and for exclusive use in registration forms;

XX - the occurrences referred to in item XVIII will be consolidated, each month, into a single list prepared in alphabetical order of account holders. The Operator may also provide, through agreements signed with interested parties, magnetic tape files containing the names appearing in the Registry of Issuers of Bounced Checks, or the consolidated lists of names, already printed, in extra quantities to be distributed to their branches;

XXI - the Registry of Issuers of Bounced Checks has only a managerial function, leaving it to the discretion of each bank to open, maintain, or close demand deposit accounts whose holder appears in it, except for eventual cases subject to determination by the Central Bank;

XXII - to effectuate the closing of demand deposit accounts, if decided, the bank must:

a) transfer the balance, within the same accounting title, to the impersonal subtitle "Accounts in Closing", which may accept withdrawals provided the balance is sufficient;

b) issue a notice to the holder, requesting the withdrawal of the available balance and, if applicable, the return of unused checks;

c) note the occurrence in the account holder's proposal form;

XXIII - when filling out the form referred to in item II, in the case of a check issued by an account holder of a joint account, only the name of the issuing holder should be indicated, adding the type of current account;

XXIV - in the case of deposit accounts titled by federal, state, and municipal departments, only the names of the respective persons responsible for issuing the bounced check (attorneys, directors, collectors, mayors) should be included in the Registry of Issuers of Bounced Checks;

XXV - an account opened for the credit of salaries, pensions, or allowances should not be closed in the event that its holder appears in the Registry of Issuers of Bounced Checks, it being admitted, at the bank's discretion, its operation exclusively by means of a separate, nominative check, in favor of the holder themselves, or against a receipt;

XXVI - occurrences are excluded from the Registry of Issuers of Bounced Checks:

a) automatically, if included for more than 24 months;

b) at the request of the drawee bank or on the initiative of the Operator itself, if the inclusion was commanded by proven error;

c) at any time, at the request of the drawee bank, in which it declares that the check giving rise to the occurrence has been settled;

d) by determination of the Central Bank;

XXVII - the request for exclusion of registration in the Registry of Issuers of Bounced Checks, formulated under the terms of item "c" of the previous item, subjects the interested party to the payment of a service fee to the drawee bank, corresponding to 50% (fifty percent) of the highest current reference value, per occurrence, disregarding the fraction of cruzeiro;

XXVIII - the fee provided for in item XIV will revert to a fund managed by the Central Bank destined to sponsor campaigns for the disclosure of check usage;

XXIX - in locations where the Check and Other Papers Clearing Service does not exist, the discipline established herein applies, insofar as applicable, to cases of returned checks in the manner of item VIII;

XXX - the names contained in the current Monthly Lists of Closed Accounts, referred to in MNI 16-9-12-41 and 50, must be considered included in the Registry of Issuers of Bounced Checks for a period of 180 days, constituting, at the discretion of each bank, a subsidy to evaluate the integrity of the depositor.

2. This Circular will enter into force on the date of its publication, revoking Circular No. 162, of 26.08.71, and Circular Letters No. 50, 68, and 96, of 03.09.71, 31.08.72, and 16.10.73.

Brasília-DF, July 29, 1980

Antonio Chagas Meirelles
Director