LETTER OF CREDIT

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Definitions

to expedite Flag missions, FBOs may only advance monies to Flag missionaires against a Flag letter of credit. A letter of credit, as a term, is found in banking practice. A bank issues them and a person holding one can go to another bank somewhere else and draw out money against the letter of credit. The letter of credit is issued for expenses up to a certain sum. When money is issued, in addition to usual bank procedures, the sum is debited on the back of the letter of credit with a signature of the cash issuing bank. We will follow this same practice except that Flag Treasury is the issuer and org FBOs are the banks that give out the funds and debit them on the back. (LRH ED 271 INT)