Full Text of HB4462 102nd General Assembly
HB4462ham001 102ND GENERAL ASSEMBLY | Rep. Jay Hoffman Filed: 2/22/2022
| | 10200HB4462ham001 | | LRB102 22844 BMS 36534 a |
|
| 1 | | AMENDMENT TO HOUSE BILL 4462
| 2 | | AMENDMENT NO. ______. Amend House Bill 4462 on page 1, | 3 | | line 5, by deleting "29,"; and
| 4 | | on page 1, line 19, by replacing " Section " with " Section 15 | 5 | | or "; and | 6 | | on page 2, line 1, after " union ", by inserting " in accordance | 7 | | with the terms of the credit union's written business plan | 8 | | submitted to the Secretary under subsection (e) "; and | 9 | | on page 3, by replacing lines 1 through 9 with the following:
| 10 | | " must submit the business plan to the Secretary. The Secretary | 11 | | may, in his or her sole discretion, approve the business plan, | 12 | | disapprove the business plan, or require the credit union to | 13 | | modify the business plan to seek approval of the target market | 14 | | as an occupational, community, or associational common bond or | 15 | | common bonds, pursuant to 38 Ill. Adm. Code 190.10. The credit |
| | | 10200HB4462ham001 | - 2 - | LRB102 22844 BMS 36534 a |
|
| 1 | | union must be advised in writing of the findings of the | 2 | | Secretary in support of the determination and the specific and | 3 | | reasonable time period in which to file a modified plan. If the | 4 | | Secretary approves the business plan the credit union shall be | 5 | | required to add the target market to its field of | 6 | | membership. "; and | 7 | | by deleting line 8 on page 11 through line 3 on page 13; and | 8 | | on page 15, line 6, by replacing "or" with " or "; and | 9 | | on page 15, line 8, after "subsection (3),", by inserting " ; or | 10 | | (iii) an external independent audit of the credit union's | 11 | | financial statements in accordance with subsection (5) "; and | 12 | | on page 17, line 4, after "Board", by inserting " , or the | 13 | | regulatory basis of accounting identified in subsection (5) "; | 14 | | and | 15 | | on page 17, line 15, after " losses ", by inserting " and | 16 | | complies with the Department's rule addressing loan loss | 17 | | accounting procedures in 38 Ill. Adm. Code 190.70 "; and | 18 | | on page 28, by replacing lines 1 through 7 with the following: | 19 | | " (15)(A) In shares, stocks, or member units of | 20 | | financial technology companies in the total amount not |
| | | 10200HB4462ham001 | - 3 - | LRB102 22844 BMS 36534 a |
|
| 1 | | exceeding 10% of the net worth of the credit union, so long | 2 | | as: | 3 | | (i) the credit union is well capitalized as | 4 | | defined under applicable supervisory capital | 5 | | classification criteria at the time a specific | 6 | | investment is made and at all times during the term of | 7 | | the investment; and | 8 | | (ii) the credit union and the financial technology | 9 | | company are operated in a manner that demonstrates to | 10 | | the public the separate corporate existence of the | 11 | | credit union and financial technology company. | 12 | | (B) Before investing in a financial technology | 13 | | company, the credit union shall obtain a written legal | 14 | | opinion as to whether the financial technology company is | 15 | | established in a manner that will limit potential exposure | 16 | | of the credit union to no more than the loss of funds | 17 | | invested in the financial technology company and the legal | 18 | | opinion shall: | 19 | | (i) address factors that have led courts to | 20 | | "pierce the corporate veil", such as inadequate | 21 | | capitalization, lack of separate corporate identity, | 22 | | common boards of directors and employees, control of | 23 | | one entity over another, and lack of separate books | 24 | | and records; and | 25 | | (ii) be provided by independent legal counsel of | 26 | | the credit union. |
| | | 10200HB4462ham001 | - 4 - | LRB102 22844 BMS 36534 a |
|
| 1 | | (C) Before investing in the financial technology | 2 | | company, the credit union shall enter into a written | 3 | | investment agreement with the financial technology company | 4 | | and the agreement shall contain the following clauses: | 5 | | (i) the financial technology company will: (I) | 6 | | provide the Department with access to the books and | 7 | | records of the financial technology company relating | 8 | | to the investment made by the credit union, with the | 9 | | costs of examining those records borne by the credit | 10 | | union in accordance with the per diem rate established | 11 | | by the Department by rule; (II) follow generally | 12 | | accepted accounting principles; and (III) provide the | 13 | | credit union with its financial statements on at least | 14 | | a quarterly basis and certified public accountant | 15 | | audited financial statements on an annual basis; and | 16 | | (ii) the financial technology company and credit | 17 | | union agree to terminate their contractual | 18 | | relationship: (I) upon 90 days' written notice to the | 19 | | parties by the Secretary that the safety and soundness | 20 | | of the credit union is threatened pursuant to the | 21 | | Department's cease and desist and suspension authority | 22 | | in Sections 8 and 61; and (II) immediately upon the | 23 | | parties' receipt of written notice from the Secretary | 24 | | when the Secretary reasonably concludes, based upon | 25 | | specific facts set forth in the notice to the parties, | 26 | | that the credit union will suffer immediate, |
| | | 10200HB4462ham001 | - 5 - | LRB102 22844 BMS 36534 a |
|
| 1 | | substantial, and irreparable injury or loss if it | 2 | | remains a party to the investment agreement. | 3 | | (D) The termination of the investment agreement | 4 | | between the financial technology company and credit union | 5 | | shall in no way operate to relieve the financial | 6 | | technology company from repaying the investment or other | 7 | | obligation due and owing the credit union at the time of | 8 | | termination. | 9 | | (E) Any financial technology company in which a credit | 10 | | union invests pursuant to this paragraph (15) that | 11 | | directly or indirectly originates, purchases, facilitates, | 12 | | brokers, or services loans to consumers in Illinois shall | 13 | | not charge an interest rate that exceeds the applicable | 14 | | maximum rate established by the Board of the National | 15 | | Credit Union Administration from time to time for payday | 16 | | alternative loans pursuant to 12 CFR 701.21(c)(7). "; and | 17 | | on page 30, immediately below line 2, by inserting the | 18 | | following: | 19 | | "Section 99. Effective date. This Act takes effect upon | 20 | | becoming law, except that Section 16.5 of the Illinois Credit | 21 | | Union Act takes effect January 1, 2023.".
|
|