H. R. 3468
IN THE SENATE OF THE UNITED STATES
May 7, 2014
Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs
To amend the Federal Credit Union Act to extend insurance coverage to amounts held in a member account on behalf of another person, and for other purposes.
This Act may be cited as the
Credit Union Share Insurance Fund Parity Act.
Insurance of amounts held on behalf of others
Section 207(k) of the Federal Credit Union Act (12 U.S.C. 1787(k)) is amended—
in paragraph (1)(A)—
by inserting after
payable to any member the following:
, or to any person with funds lawfully held in a member account,; and
and paragraphs (5) and (6);
in paragraph (2)(A), by striking
(as determined under paragraph (5));
by redesignating paragraph (5) as paragraph (6); and
by inserting after paragraph (4) the following:
Coverage for Interest On Lawyers Trust Accounts (IOLTA) and other similar escrow accounts
The Administration shall provide pass-through share insurance for the deposits or shares of any interest on lawyers trust account (IOLTA) or other similar escrow accounts.
Treatment of IOLTAs
Treatment as escrow accounts
For share insurance purposes, IOLTAs are treated as escrow accounts.
Treatment as member accounts
IOLTAs and other similar escrow accounts are considered member accounts for purposes of paragraph (1), if the attorney administering the IOLTA or the escrow agent administering the escrow account is a member of the insured credit union in which the funds are held.
For purposes of this paragraph:
Interest on lawyers trust account
interest on lawyers trust account and
IOLTA mean a system in which lawyers place certain client funds in interest-bearing or dividend-bearing
accounts, with the interest or dividends then used to fund programs such
as legal service organizations who provide services to clients in need.
Pass-through share insurance
pass-through share insurance means, with respect to IOLTAs and other similar escrow accounts, insurance coverage based on the
interest of each person on whose behalf funds are held in such accounts by
the attorney administering the IOLTA or the escrow agent administering a
similar escrow account, in accordance with regulations issued by the
Rule of construction
No provision of this paragraph shall be construed as authorizing an insured credit union to accept the deposits of an IOLTA or similar escrow account in an amount greater than such credit union is authorized to accept under any other provision of Federal or State law.
Passed the House of Representatives May 6, 2014.
Karen L. Haas,