Independent treasury act

The Act was passed in 1840 and took the federal government out of the nation's banking system. It established federal depositories for public funds instead of keeping the money in national or state (pet) banks. President Martin Van Buren proposed the Act in 1837, partly in response to the panic of 1837 which had caused many people to lose their money during that period as well as public funds being lost. Under the Act, bank notes were phased out for payments to and from the government and only hard money was to be accepted--coin gold or silver. Sub treasuries were created for federal funds in several major cities, like Boston, New York, and Philadelphia. Wikipedia has an article on the Independent Treasury Act.