State of Illinois
91st General Assembly
Legislation

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91_SB0098eng

 
SB98 Engrossed                                LRB9101012JSpcA

 1        AN ACT to amend the Illinois Credit Union Act by changing
 2    Sections 5 and 42.

 3        Be  it  enacted  by  the People of the State of Illinois,
 4    represented in the General Assembly:

 5        Section 5.  The Illinois Credit Union Act is  amended  by
 6    changing Sections 5 and 42 as follows:

 7        (205 ILCS 305/5) (from Ch. 17, par. 4406)
 8        Sec. 5. Place of business.
 9        (1)  A  credit  union  may  change its principal place of
10    business within this State upon 45 days prior written  notice
11    to  approval  of the Department, provided that a credit union
12    with a neighborhood or community common bond may not relocate
13    its principal place of business outside of  its  neighborhood
14    or  community the Director's approval shall be based upon the
15    same criteria as for the formation of a new credit union.
16        (2)  A credit union may share office space  with  one  or
17    more  credit  unions  and  contract  with any person, firm or
18    corporation,  including  another  credit  union,  to  provide
19    facilities or personnel.
20    (Source: P.A. 81-329.)

21        (205 ILCS 305/42) (from Ch. 17, par. 4443)
22        Sec. 42.  Shares in trust.
23        (1)  Shares may be issued in trust to a member as trustee
24    or to an individual or corporate  trustee.   If  a  corporate
25    trustee  is  a bank or trust company, shares may be issued to
26    the corporate trustee only if such bank or trust  company  is
27    organized  under  the  laws  of the State of Illinois or is a
28    nationally chartered bank located principally in the State of
29    Illinois.  An individual trustee shall be  a  member  of  the
30    credit  union  unless  the  person  establishing the trust in
 
SB98 Engrossed              -2-               LRB9101012JSpcA
 1    respect to which such shares are issued or  each  beneficiary
 2    of  the trust is a member of the credit union and the name of
 3    each beneficiary is disclosed to the  credit  union.   Shares
 4    may  also be issued in the name of an individual or corporate
 5    representative under the Illinois  Probate  Act  of  1975  as
 6    amended,  for  or  in  respect to a member of a credit union.
 7    Shares may also be issued in trust under the Illinois Funeral
 8    or Burial Funds Act, for or in  respect  to  a  member  of  a
 9    credit  union,  to  a  trustee  licensed under said Act.  Any
10    credit union which issues shares in trust as provided in this
11    Section must be insured  by  the  NCUA  or  another  approved
12    insurer.   No  trustee or beneficiary, unless a member in his
13    own right, shall be permitted to  vote,  obtain  loans,  hold
14    office  or  be required to pay an entrance or membership fee.
15    Payment of part or all of such  shares  to  such  trustee  or
16    member  shall,  to  the extent of such payment, discharge the
17    liability  of  the  credit  union  to  the  member  and   the
18    beneficiary and the credit union shall be under no obligation
19    to see to the application of such payment.
20        (2)  If  a  credit union's shares are insured as provided
21    for in this Act, such credit union shall have power to act as
22    trustee or custodian under individual retirement accounts  or
23    plans  established  pursuant  to  Section  401(d)  or  (f) or
24    Section 408(a) of the Internal  Revenue  Code  and  any  laws
25    amendatory or supplementary thereto for its members or groups
26    or  organizations  of  its members provided the funds of such
27    accounts or plans are invested solely in (1)  share  accounts
28    of,  or  (2)  share  accounts  and obligations issued by such
29    credit union.  All funds  held  in  such  fiduciary  capacity
30    shall  be  maintained  in accordance with applicable statutes
31    and  regulations  promulgated  thereunder  by  any  authority
32    exercising  jurisdiction  over  such  trusts   or   custodial
33    accounts.
34        (3)  Notwithstanding any language to the contrary in this
 
SB98 Engrossed              -3-               LRB9101012JSpcA
 1    Section 42, a credit union may act as trustee or custodian of
 2    individual   retirement  plans  of  its  members  established
 3    pursuant to the Employee Retirement Income  Security  Act  of
 4    1974  or  self-employed retirement plans established pursuant
 5    to the Self-Employed Individuals Retirement Act of 1962,  and
 6    any  laws  amendatory or supplementary to such Acts, provided
 7    that:
 8        (a)  All contributions of funds are initially made  to  a
 9    share account in the credit union;
10        (b)  Any  subsequent transfer of funds to other assets is
11    solely at the direction of the member and  the  credit  union
12    performs  only  custodial  duties,  exercises  no  investment
13    discretion  and provides no investment advice with respect to
14    plan assets;
15        (c)  The member  is  notified  of  the  fact  that  share
16    insurance   coverage  is  limited  to  funds  held  in  share
17    accounts; and
18        (d)  The  credit  union  complies  with  all   applicable
19    provisions of this Act and applicable laws and regulations as
20    may  be  promulgated by any authority exercising jurisdiction
21    over such trust or custodial accounts.
22    (Source: P.A. 85-1273.)

23        Section 99.  Effective date.  This Act takes effect  upon
24    becoming law.

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