Bill Text: MI HB5020 | 2015-2016 | 98th Legislature | Engrossed
Bill Title: Financial institutions; credit unions; examinations by department of insurance and financial services; revise requirements and provide for confidentiality of certain documents. Amends sec. 207 of 2003 PA 215 (MCL 490.207). TIE BAR WITH: HB 5017'15, HB 5018'15, HB 5019'15, HB 5021'15, HB 5022'15
Spectrum: Moderate Partisan Bill (Republican 8-2)
Status: (Passed) 2016-06-09 - Assigned Pa 155'16 With Immediate Effect [HB5020 Detail]
Download: Michigan-2015-HB5020-Engrossed.html
HB-5020, As Passed House, December 9, 2015
SUBSTITUTE FOR
HOUSE BILL NO. 5020
A bill to amend 2003 PA 215, entitled
"Credit union act,"
by amending section 207 (MCL 490.207).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec.
207. (1) The commissioner director
or his or her
authorized agent shall examine the condition and affairs of each
domestic credit union, and may examine the condition and affairs of
any
subsidiary of a domestic credit union, not less frequently than
at
least once every 18 months. The commissioner
director shall
determine whether the domestic credit union transacts its business
in the manner prescribed by law and the rules promulgated under
law.
(2) In connection with an examination under subsection (1),
the
commissioner director or the commissioner's director's
authorized
agent may examine under oath a director, board member,
officer, agent, or employee of a domestic credit union concerning
the affairs and business of the domestic credit union. The
commissioner
director or the commissioner's director's authorized
agent may examine an affiliate of a domestic credit union if
necessary
to fully disclose the relation relationship
between the
domestic credit union and the affiliate and the effect of the
relation
upon relationship on the domestic credit union.
(3)
The commissioner director may examine a branch or branches
located in this state of a foreign credit union.
(4)
In an examination under this section, the commissioner
director may use an examination made under the federal credit union
act,
chapter 750, 48 Stat. 1216, 12 U.S.C. 12 USC 1751 to 1795k,
any other federal law related to the chartering or insuring of
financial institutions, or the law of another state governing the
activities of foreign credit unions organized in or regulated by
that
state. The commissioner director
may require a credit union to
furnish a copy of any report required by a federal or state credit
union regulatory agency.
(5)
The commissioner director may contract with another state
credit union regulatory agency to assist in the conduct of
examinations of domestic credit unions with 1 or more branches
located in that other state and in examinations of foreign credit
unions with 1 or more branches located in this state.
(6)
The contents of a report of examination of a domestic
credit
union and examination-related
documents, materials, or
information
that are prepared or obtained under
this section act
remain
the property of the commissioner. A person who disseminates
all
or part of a domestic credit union's report of examination for
purposes
other than the legitimate business purposes of the
domestic
credit union or as otherwise authorized by this act
violates
this act and is subject to the administrative remedies
granted
the commissioner under this part.director.
Any document,
material, or information related to an examination under this act
is confidential by law and privileged, is not subject to the
freedom of information act, 1976 PA 442, MCL 15.231 to 15.246, is
not subject to subpoena, and is not subject to discovery or
admissible in evidence in any private civil action. However, the
director is authorized to use the documents, materials, or
information in the furtherance of any supervisory activity or legal
action brought as part of the director's duties.
(7) The director, or any person that received documents,
materials, or information while acting under the director's
authority, is not permitted and may not be required to testify in
any private civil action concerning any confidential documents,
materials, or information described in subsection (6).
(8) To assist in the performance of the director's duties
under this act, the director may do any of the following:
(a) Share documents, materials, or information, including the
confidential and privileged documents, materials, or information
that are subject to subsection (6), with other state, federal, and
international regulatory agencies, and with state, federal, and
international law enforcement authorities, provided that the
recipient agrees to maintain the confidentiality and privileged
status of the documents, materials, or information.
(b) Receive documents, materials, or information, including
otherwise confidential and privileged documents, materials, or
information, from regulatory and law enforcement officials of other
foreign or domestic jurisdictions. The director shall maintain as
confidential or privileged any documents, materials, or information
received with notice or the understanding that the documents,
materials, or information the director receives are confidential or
privileged under the laws of the jurisdiction that is the source of
the documents, materials, or information.
(c) Enter into agreements governing the sharing and use of
information that are consistent with this subsection.
(9) The disclosure of any documents, materials, or information
to the director, or the sharing of documents, materials, or
information under subsection (8), is not a waiver of, and shall not
be construed as a waiver of, any privilege applicable to or claim
of confidentiality in those documents, materials, or information.
(10) This article does not prohibit the director from
releasing final, adjudicated actions that are open to public
inspection under the freedom of information act, 1976 PA 442, MCL
15.231 to 15.246, to a database or other clearinghouse service
maintained by the National Credit Union Administration or its
affiliates or subsidiaries.
(11) A person to which confidential and privileged documents,
materials, or information is disclosed shall not further
disseminate those confidential and privileged documents, materials,
or information.
(12) Any person on which a demand for production of
confidential and privileged documents, materials, or information is
made, whether by subpoena, order, or other judicial or
administrative process, must withhold production of the
confidential and privileged documents, materials, or information
and must notify the director of the demand. If the director is
notified of a demand under this subsection, the director may
intervene for the purpose of enforcing the limitations of this
section or seeking the withdrawal or termination of the attempt to
compel production of the confidential and privileged documents,
materials, or information.
(13) Any request for discovery or disclosure of confidential
and privileged documents, materials, or information, whether by
subpoena, order, or other judicial or administrative process, shall
be made to the director, and the director shall determine within 7
days whether to disclose the documents, materials, or information
under this act. If the director determines that the documents,
material, or information will not be disclosed, the director's
decision is subject to judicial review.
(14) The judicial review of a decision of the director under
subsection (13) may include in camera judicial review of the
confidential and privileged documents, materials, or information.
After judicial review, a court may only order disclosure of the
portions of the confidential and privileged documents, materials,
or information that are relevant and otherwise unobtainable by the
requesting party.
(15) The director may immediately appeal any court order
described in subsection (14) that compels disclosure of
confidential and privileged documents, materials, or information,
and the order is automatically stayed pending the outcome of the
appeal.
(16) In an addendum to a report of an examination under this
section, the director or his or her authorized agent may suggest
best practices or other improvements in the operation of a domestic
credit union that are not required by law or regulation or to
address safety and soundness of the domestic credit union. The
manner in which a domestic credit union addresses issues concerning
its operations is within the discretion of the credit union in the
exercise of its business judgment, except as required by law or
regulation or to address a concern over safety and soundness. The
director shall not take action against a domestic credit union
under this act based on a failure or refusal of a domestic credit
union to follow a best practice or other recommended improvement in
the operation of the domestic credit union that is suggested
informally by an examiner or that is contained in an addendum to a
report of examination.
(17) Within 1 year after the effective date of the amendatory
act that added this subsection, the director shall issue guidance
to promote consistency and due process in the examination process
under this section, including, but not limited to, establishing
guidelines that define the scope of the examination process and
clarify how examination issues will be resolved.
Enacting section 1. This amendatory act takes effect 90 days
after the date it is enacted into law.
Enacting section 2. This amendatory act does not take effect
unless all of the following bills of the 98th Legislature are
enacted into law:
(a) Senate Bill No.____ (request no. 02768'15) or House Bill
No. 5017.
(b) Senate Bill No.____ (request no. 02769'15) or House Bill
No. 5018.
(c) Senate Bill No.____ (request no. 02772'15) or House Bill
No. 5021.
(d) Senate Bill No.____ (request no. 02773'15) or House Bill
No. 5022.
