The California Credit Union Law (CCUL) provides for the licensure and regulation of credit unions by the Commissioner of Business Oversight and makes a willful violation of that law a crime. The law prohibits a member of the board of directors, supervisory committee, or credit committee from receiving compensation for services as a member of the board of directors or those committees, subject to an exception for reasonable health, accident, and similar insurance and specified expense reimbursement.
This bill would prohibit a member of the audit committee from receiving compensation for services as a member of those committees and would authorize reimbursement to those committee members for the travel expenses incurred for one guest per director or committee member.
The Nonprofit Mutual Benefit Corporation
Law prohibits a credit union from expelling a member without providing that member specified due process, including 15 days’ prior notice of the expulsion, suspension, or termination and the reasons therefor and an opportunity to be heard, as specified, before the effective date of the expulsion. The CCUL authorizes the board of directors of a credit union to expel a member for specified causes, including conviction for a criminal offense involving moral turpitude, unless the bylaws of the credit union expressly reserve that duty to members and entitles an expelled member to appeal the expulsion to the members, as specified.
This bill would authorize the board of directors to expel a member for abusive, threatening, or harassing behavior toward credit union staff, volunteers, or members, or the abuse of credit union systems or property and would authorize that expulsion to take effect immediately and without advance notice or an opportunity to be heard, if the board
of directors or its designee determines that immediate expulsion is reasonably necessary for the protection of the credit union or its staff, volunteers, or members. The bill would require a member expelled in that manner be provided written notice within 5 days after the effective date of that expulsion and would entitle the member, and a member expelled by the board of directors for any of the other specified causes, to appeal that expulsion to the supervisory or audit committee, as applicable.
The CCUL authorizes a credit union to purchase a promissory note upon which a member is the primary obligor, authorizes a credit union to issue shares to specified entities, and prohibits a credit union from entering into any loan or approved line of credit, including both used and unused portions, on which the official is a borrower, coborrower, cosigner, endorser, or guarantor with an official, as defined, of the credit union.
This bill would revise and recast those provisions, including by repealing the authorization to purchase a promissory note upon which a member is the primary obligor and would authorize a credit union to issue shares to a member or nonmember state or federal credit union.
The CCUL authorizes a member to withdraw from membership in the credit union at any time, as specified, and authorizes a credit union to transfer a member who has no outstanding obligations with the credit union and whose share account is below the amount established by the bylaws to inactive status.
This bill would authorize a credit union to deem an inactive member to have withdrawn from membership, subject to specified notice and other conditions.
Existing law, subject to specified exceptions, makes it a crime for a person to contrive, prepare, set up, propose, or draw any
lottery, whether it is called a lottery, raffle, gift enterprise, or other name. The CCUL authorizes a credit union to sponsor or participate in a savings promotion that provides savings account depositors with a chance to win designated prizes if the credit union satisfies certain requirements and prohibits these savings promotions from being considered a lottery or raffle within the meaning of those aforementioned criminal provisions, as provided.
This bill would specify that those provisions apply to any credit union authorized to do business in the state that is chartered under the laws of this state, another state, or specified federal law.
By expanding the scope of the crime of willfully violating the provisions of the CCUL, this bill would create a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and
school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.