[Code of Federal Regulations]
[Title 31, Volume 2]
[Revised as of July 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 31CFR354.5]

[Page 347]
 
                  TITLE 31--MONEY AND FINANCE: TREASURY
 
         CHAPTER II--FISCAL SERVICE, DEPARTMENT OF THE TREASURY
 
PART 354--REGULATIONS GOVERNING BOOK-ENTRY SECURITIES OF THE STUDENT LOAN MARKETING ASSOCIATION (SALLIE MAE)--Table of Contents
 
Sec. 354.5  Obligations of Sallie Mae; no adverse claims.

    (a) Except in the case of a security interest in favor of the United 
States or a Federal Reserve Bank or otherwise as provided in 
Sec. 354.4(c)(1), for the purposes of this part 354, Sallie Mae and the 
Federal Reserve Banks shall treat the Participant to whose Securities 
Account an interest in a Book-entry Sallie Mae Security has been 
credited as the person exclusively entitled to issue a Transfer Message, 
to receive interest and other payments with respect thereof and 
otherwise to exercise all the rights and powers with respect to such 
Security, notwithstanding any information or notice to the contrary. 
Neither the Federal Reserve Banks nor Sallie Mae is liable to a Person 
asserting or having an Adverse Claim to a Security Entitlement or to a 
Book-entry Sallie Mae Security in a Participant's Securities Account, 
including any such claim arising as a result of the transfer or 
disposition of a Book-entry Sallie Mae Security by a Federal Reserve 
Bank pursuant to a Transfer Message that the Federal Reserve Bank 
reasonably believes to be genuine.
    (b) The obligation of Sallie Mae to make payments of interest and 
principal with respect to Book-entry Sallie Mae Securities is discharged 
at the time payment in the appropriate amount is made as follows:
    (1) Interest on Book-entry Sallie Mae Securities is either credited 
by a Federal Reserve Bank to a Funds Account maintained at such Bank or 
otherwise paid as directed by the Participant.
    (2) Book-entry Sallie Mae Securities are redeemed at maturity or 
pursuant to a call for redemption in accordance with their terms by a 
Federal Reserve Bank withdrawing the securities from the Participant's 
Securities Account in which they are maintained and by either crediting 
the amount of the redemption proceeds, including both principal and 
interest where applicable, to a Funds Account at such Bank or otherwise 
paying such principal and interest, as directed by the Participant.

[[Page 348]]