Illinois General Assembly - Full Text of Public Act 094-0150
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Public Act 094-0150


 

Public Act 0150 94TH GENERAL ASSEMBLY



 


 
Public Act 094-0150
 
SB0173 Enrolled LRB094 06716 MKM 36815 b

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

Effective Date: 7/8/2005