H.R. 3468 — what changed
Credit Union Share Insurance Fund Parity Act
From Introduced in House to Engrossed in House. 1 section amended between Introduced in House and Engrossed in House.
Sec. 2 Insurance of amounts held on behalf of others
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Section 207(k)(1) 207(k) of the Federal Credit Union Act (12 U.S.C. 1787(k)(1)) 1787(k)) is amended—
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in subparagraph (A), by inserting after “deposits in the name of the member” the following: “or held in the member’s account on behalf of another person”; andparagraph (1)(A)—
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by inserting after “payable to any member” the following: “, or to any person with funds lawfully held in a member account,”; and
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by striking “and paragraphs (5) and (6)”;
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in subparagraph (C), paragraph (2)(A), by striking the period and inserting the following: “, or where a member holds funds for the use of a nonmember. Coverage for an account established by a member shall be consistent with that of the Federal Deposit Insurance Corporation regardless of the membership status of the owner of the funds that are deposited in an account established by a credit union member.”.“(as determined under paragraph (5))”;
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by redesignating paragraph (5) as paragraph (6); and
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by inserting after paragraph (4) the following:
added “(5) Coverage for Interest On Lawyers Trust Accounts (IOLTA) and other similar escrow accounts
added “(A) Pass-through insurance—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.
added “(B) Treatment of IOLTAs
added “(i) Treatment as escrow accounts—For share insurance purposes, IOLTAs are treated as escrow accounts.
added “(ii) 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.
added “(C) Definitions—For purposes of this paragraph:
added “(i) Interest on lawyers trust account—The terms “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.
added “(ii) Pass-through share insurance—The term “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 Administration.
added “(D) 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.”