31 C.F.R. § 355.6 What happens if the presenting bank breaches its warranty?
Title 31 - Money and Finance: Treasury
If the presenting bank breaches its warranty, the payor Reserve Bank may either return the check to the presenting bank or send notice of the breach to the presenting bank. If the presenting bank does not make prompt restitution when it receives the returned check or notice of breach, we may begin appropriate collection procedures.
Title 31: Money and Finance: Treasury
PART 355—REGULATIONS GOVERNING FISCAL AGENCY CHECKS
§ 355.6 What happens if the presenting bank breaches its warranty?