Government payments are typically originated by federal agencies through the Treasury Department's Financial Management Service (FMS), which in turn delivers payment instructions to the Federal Reserve for
subsequent delivery to banks or processors.
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Small banks, especially those in remote locations, depend more heavily on the Federal Reserve for
check collection than do big banks in larger cities.
Although it is difficult to quantify results in this area, it is important to note that the federal law enforcement community looks toward, and relies on, the Federal Reserve for
assistance and guidance with respect to money laundering matters.
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By temporarily selling some of its foreign currency holdings to the Federal Reserve for
dollars through warehousing, the ESF was able to continue to purchase foreign currencies even after it had exhausted its initial dollar resources.