Full Text of SB0173 94th General Assembly
SB0173eng 94TH GENERAL ASSEMBLY
|
|
|
SB0173 Engrossed |
|
LRB094 06716 MKM 36815 b |
|
| 1 |
| AN ACT concerning regulation.
| 2 |
| Be it enacted by the People of the State of Illinois,
| 3 |
| represented in the General Assembly:
| 4 |
| Section 5. The Illinois Credit Union Act is amended by | 5 |
| changing Sections 13, 42, 47, and 70 as follows:
| 6 |
| (205 ILCS 305/13) (from Ch. 17, par. 4414)
| 7 |
| Sec. 13. General powers. A credit union may:
| 8 |
| (1) Make contracts; sue and be sued; and adopt and use | 9 |
| a common seal
and alter the same;
| 10 |
| (2) Acquire, lease (either as lessee or lessor), hold, | 11 |
| pledge, mortgage,
sell and dispose of real property, either | 12 |
| in whole or in part, or any interest
therein, as may be | 13 |
| necessary or incidental to its present or future
operations | 14 |
| and needs, subject to such limitations as may be imposed
| 15 |
| thereon in rules and regulations promulgated by the | 16 |
| Director; acquire, lease
(either as lessee or lessor), | 17 |
| hold, pledge, mortgage, sell and dispose of
personal | 18 |
| property, either in whole or in part, or any interest | 19 |
| therein,
as may be necessary or incidental to its present | 20 |
| or future operations
and needs;
| 21 |
| (3) At the discretion of the Board of Directors, | 22 |
| require the payment of
an entrance fee or annual membership | 23 |
| fee, or both, of any person admitted to
membership;
| 24 |
| (4) Receive savings from its members in the form of | 25 |
| shares of various
classes, or special purpose share | 26 |
| accounts; act as custodian of its members'
accounts; issue | 27 |
| shares in trust as provided in this Act;
| 28 |
| (5) Lend its funds to its members and otherwise as | 29 |
| hereinafter provided;
| 30 |
| (6) Borrow from any source in accordance with policy | 31 |
| established by the
Board of Directors to a maximum of 50% | 32 |
| of capital, surplus and reserves;
|
|
|
|
SB0173 Engrossed |
- 2 - |
LRB094 06716 MKM 36815 b |
|
| 1 |
| (7) Discount and sell any obligations owed to the | 2 |
| credit union;
| 3 |
| (8) Honor requests for withdrawals or transfers of all | 4 |
| or any part of
member share accounts, and any classes | 5 |
| thereof, in any manner approved by
the credit union Board | 6 |
| of Directors;
| 7 |
| (9) Sell all or substantially all of its assets or | 8 |
| purchase all or
substantially all of the assets of another | 9 |
| credit union, subject to the
prior approval of the | 10 |
| Director;
| 11 |
| (10) Invest surplus funds as provided in this Act;
| 12 |
| (11) Make deposits in banks, savings banks, savings and | 13 |
| loan associations,
trust companies; and invest in shares, | 14 |
| classes of shares or share certificates
of other credit | 15 |
| unions;
| 16 |
| (12) Assess charges and fees to members in accordance | 17 |
| with board
resolution;
| 18 |
| (13) Hold membership in and pay dues to associations | 19 |
| and organizations;
to invest in shares, stocks or | 20 |
| obligations of any credit union organization;
| 21 |
| (14) Declare dividends and pay interest refunds to | 22 |
| borrowers as provided
in this Act;
| 23 |
| (15) Collect, receive and disburse monies in | 24 |
| connection with providing
negotiable checks, money orders | 25 |
| and other money-type instruments, and for
such other | 26 |
| purposes as may provide benefit or convenience to its | 27 |
| members,
and charge a reasonable fee for such services;
| 28 |
| (16) Act as fiscal agent for and receive deposits from | 29 |
| the federal
government, this state or any agency or | 30 |
| political subdivision thereof;
| 31 |
| (17) Receive savings from nonmembers in the form of | 32 |
| shares or share
accounts in the case of credit unions | 33 |
| serving predominantly low-income
members. The term "low | 34 |
| income
members" shall mean those members who make less than | 35 |
| 80% of the average for
all wage earners as established by | 36 |
| the Bureau of Labor Statistics or those
members whose |
|
|
|
SB0173 Engrossed |
- 3 - |
LRB094 06716 MKM 36815 b |
|
| 1 |
| annual household income falls at or below 80% of the
median | 2 |
| household income for the nation as established by the | 3 |
| Census Bureau. The
term "predominantly" is defined as a | 4 |
| simple majority;
| 5 |
| (18) To Establish, maintain, and operate terminals as | 6 |
| authorized by
the Electronic Fund Transfer Act; and
| 7 |
| (19) Subject to Article XLIV of the Illinois Insurance | 8 |
| Code, to act
as the agent for any fire, life, or other | 9 |
| insurance company authorized by the
State of Illinois, by | 10 |
| soliciting and selling insurance and collecting premiums
| 11 |
| on policies issued by such company; and may receive for | 12 |
| services so rendered
such fees or commissions as may be | 13 |
| agreed upon between the said credit union
and the insurance | 14 |
| company for which it may act as agent; provided, however,
| 15 |
| that no such credit union shall in any case assume or | 16 |
| guarantee the payment of
any premium on insurance policies | 17 |
| issued through its agency by its principal;
and provided | 18 |
| further, that the credit union shall not guarantee the | 19 |
| truth of
any statement made by an assured in filing his | 20 |
| application for insurance ; and .
| 21 |
| (20) Make reasonable contributions to civic, | 22 |
| charitable, or service organizations not organized for | 23 |
| profit; religious corporations; and fundraisers benefiting | 24 |
| persons in the credit union's service area.
| 25 |
| (Source: P.A. 92-608, eff. 7-1-02; revised 1-20-03.)
| 26 |
| (205 ILCS 305/42) (from Ch. 17, par. 4443)
| 27 |
| Sec. 42. Shares in trust.
| 28 |
| (1) Shares may be issued in trust to a member
as trustee or | 29 |
| to an individual or corporate trustee. If a corporate trustee
| 30 |
| is a bank or trust company, shares may be issued to the | 31 |
| corporate trustee
only if such bank or trust company is | 32 |
| organized under the laws of
the State of Illinois or is a | 33 |
| nationally chartered bank located principally
in the State of | 34 |
| Illinois. An individual trustee shall be a member of the
credit | 35 |
| union unless the person establishing the trust in respect to |
|
|
|
SB0173 Engrossed |
- 4 - |
LRB094 06716 MKM 36815 b |
|
| 1 |
| which
such shares are issued or each beneficiary of the trust | 2 |
| is a member of the
credit union and the name of each | 3 |
| beneficiary is disclosed to the credit
union. Shares may also | 4 |
| be issued in the name of an individual or corporate
| 5 |
| representative under the Illinois Probate Act of 1975 for or
in | 6 |
| respect to a member of a credit union. Shares may also be | 7 |
| issued in
trust under the Illinois Funeral or Burial Funds Act, | 8 |
| for or in respect
to a member of a credit union, to a trustee | 9 |
| licensed under said Act.
Any credit union which issues shares | 10 |
| in trust as provided in this Section
must be insured by the | 11 |
| NCUA or another approved insurer. Payment of part or all of | 12 |
| such shares to such trustee or member
shall, to the extent of | 13 |
| such payment, discharge the liability of the credit
union to | 14 |
| the member and the beneficiary and the credit union shall be | 15 |
| under
no obligation to see to the application of such payment.
| 16 |
| (2) If a credit union's shares are insured as provided for | 17 |
| in this Act,
such credit union shall have power to act as | 18 |
| trustee or custodian under
individual retirement accounts or | 19 |
| plans , health savings accounts, and similar tax-advantaged | 20 |
| savings plans established pursuant to the Internal Revenue Code | 21 |
| for its members or groups or
organizations
of its members | 22 |
| provided the funds of such accounts or plans are invested
| 23 |
| solely in (1) share accounts of, or (2) share accounts and | 24 |
| obligations issued
by such credit union. All funds held in such | 25 |
| fiduciary capacity shall be
maintained in accordance with | 26 |
| applicable statutes and regulations promulgated
thereunder by | 27 |
| any authority exercising jurisdiction over such trusts or
| 28 |
| custodial accounts.
| 29 |
| (3) Notwithstanding any language to the contrary in this | 30 |
| Section 42, a
credit union may act as trustee or custodian of | 31 |
| individual retirement plans
of its members established | 32 |
| pursuant to the Employee Retirement Income
Security Act of 1974 | 33 |
| or self-employed retirement plans established pursuant
to the | 34 |
| Self-Employed Individuals Retirement Act of 1962, and any laws
| 35 |
| amendatory or supplementary to such Acts, provided that:
| 36 |
| (a) All contributions of funds are initially made to a |
|
|
|
SB0173 Engrossed |
- 5 - |
LRB094 06716 MKM 36815 b |
|
| 1 |
| share account in
the credit union;
| 2 |
| (b) Any subsequent transfer of funds to other assets is | 3 |
| solely at the
direction of the member and the credit union | 4 |
| performs only custodial
duties, exercises no investment | 5 |
| discretion and provides no investment
advice with respect | 6 |
| to plan assets;
| 7 |
| (c) The member is notified of the fact that share | 8 |
| insurance coverage is
limited to funds held in share | 9 |
| accounts; and
| 10 |
| (d) The credit union complies with all applicable | 11 |
| provisions of this Act
and applicable laws and regulations | 12 |
| as may be promulgated by any authority
exercising | 13 |
| jurisdiction over such trust or custodial accounts.
| 14 |
| (Source: P.A. 91-131, eff. 7-16-99; 92-608, eff. 7-1-02.)
| 15 |
| (205 ILCS 305/47) (from Ch. 17, par. 4448)
| 16 |
| Sec. 47. Loan Applications. Every application for a loan | 17 |
| shall be made
in the manner prescribed by
writing upon a form, | 18 |
| which the Credit Committee, credit manager, or loan
officer | 19 |
| prescribes . The application shall state the purpose for which | 20 |
| the
loan is desired, and the security, if any, offered. Each | 21 |
| loan shall be evidenced
by a written document or by a record | 22 |
| electronically stored or generated by any electronic or | 23 |
| computer-generated process that accurately reproduces or | 24 |
| records the agreement, transaction, act, occurrence, or event. | 25 |
| The signature of any party to the loan includes any symbol | 26 |
| executed or adopted, or any security procedure employed or | 27 |
| adopted, using electronic means or otherwise, by or on behalf | 28 |
| of a person with intent to authenticate a record .
| 29 |
| (Source: P.A. 81-329.)
| 30 |
| (205 ILCS 305/70) (from Ch. 17, par. 4471)
| 31 |
| Sec. 70. Use of name, sentence. | 32 |
| (a) No individual
person , firm, association,
or body | 33 |
| politic and corporate, including, without limitation, any | 34 |
| corporation, limited liability company, general partnership, |
|
|
|
SB0173 Engrossed |
- 6 - |
LRB094 06716 MKM 36815 b |
|
| 1 |
| limited partnership, or joint venture that is not an authorized | 2 |
| user
partnership,
or corporation, except corporations | 3 |
| organized under this Act, the credit
union acts of other | 4 |
| states, or under the Federal Credit Union Act,
associations
of | 5 |
| such corporations, or subsidiaries of such associations, may | 6 |
| use any
name or title which contains the words
"credit union" | 7 |
| or any abbreviation thereof, and such use is a Class A
| 8 |
| Misdemeanor. For purposes of this Section, "authorized user" | 9 |
| means a corporation organized under this Act, the credit union | 10 |
| act of another state, or the Federal Credit Union Act, any | 11 |
| association of such a corporation, and subsidiaries and | 12 |
| affiliates of such an association.
| 13 |
| (b) If the Director of the Division of Financial | 14 |
| Institutions of the Department of Financial and Professional | 15 |
| Regulation finds that an individual or entity that is not an | 16 |
| authorized user has transacted or intends to transact business | 17 |
| in this State in a manner that has a substantial likelihood of | 18 |
| misleading the public by: (i) implying that the business is a | 19 |
| credit union or (ii) using or intending to use the words | 20 |
| "credit union", or any abbreviation thereof, in connection with | 21 |
| its business, then the Director of the Division of Financial | 22 |
| Institutions may direct the individual or entity to cease and | 23 |
| desist from transacting its business or using the words "credit | 24 |
| union", or any abbreviation thereof. If the individual or | 25 |
| entity persists in transacting its business or using the words | 26 |
| "credit union", or any abbreviation thereof, then the Director | 27 |
| of the Division of Financial Institutions may impose a civil | 28 |
| penalty of up to $10,000 for each violation. Each day that the | 29 |
| individual or entity continues transacting business or using | 30 |
| the words "credit union", or any abbreviation thereof, in | 31 |
| connection with its business shall constitute a separate | 32 |
| violation of these provisions.
| 33 |
| (Source: P.A. 92-293, eff. 8-9-01.)
| 34 |
| Section 99. Effective date. This Act takes effect upon | 35 |
| becoming law.
|
|