Chapter 171

Section 1. As used in this chapter the following words shall, unless the context otherwise requires, have the following meanings:— ''Central Credit Union Fund, Inc.'', the corporation established by chapter 216 of the acts of 1932. ''Commissioner'', the commissioner of banks. ''C…

Section 10. The by-laws may be amended at any annual meeting, or at a special meeting called for the purpose, by a majority vote of all of the members present and entitled to vote; provided, however, that the notice of the meeting and of the proposed amendment is given each membe…

Section 11. The annual meeting of the corporation shall be held at such time and place as the by-laws prescribe but not later than one hundred and twenty days after the close of the fiscal year. The fiscal year of every credit union shall end at the close of business on the last …

Section 12. The business and affairs of a credit union shall be managed by a board of not less than 7 directors. A credit union may limit the number of employees serving as directors in its by-laws. The directors shall be elected at the annual meetings. All members of said board …

Section 13. The board of directors shall have the general direction of the affairs of the corporation and shall meet not less than once each month. A quorum shall consist of not less than a majority of the directors. If less than a quorum is present, a majority of those present m…

Section 14. The board of directors may expel from a credit union a member who: (i) has not carried out the member's engagements with the credit union; (ii) has been convicted of a criminal offense; (iii) neglects or refuses to comply with this chapter or the by-laws of the credit…

Section 15. The directors, at a regularly scheduled meeting or at a special meeting of the directors called for the purpose and thereafter at their first meeting after the annual meeting, shall elect from their own number a chairman of the board and a clerk and shall elect person…

Section 16. The auditing committee shall keep fully informed at all times as to the financial condition of the credit union. The auditing committee shall: (i) hold meetings not less than once each month; (ii) keep records of the meetings; (iii) certify the monthly statements subm…

Section 17. The credit committee, if any, shall hold meetings not less than once in each month, act on all applications for loans and approve, in writing, all personal loans granted and the security, if any, pledged therefor, except as provided in this section. The credit committ…

Section 18. Investments authorized by section sixty-seven and other applicable sections may be made by the investment committee and a report of any such investments shall be submitted to the board of directors at its regular meeting next following the date upon which any such inv…

Section 19. No person shall be a director of two credit unions at the same time and no person holding the office of president, treasurer, member of the credit committee, member of the auditing committee or bookkeeper or an employee having access to securities or cash in a credit …

Section 2. Ten or more persons, the majority of whom reside in the commonwealth, who have associated themselves by a written agreement with the intention of forming a corporation for the purpose of accumulating and receiving the savings of its members in payment for shares or on …

Section 20. No member of the board of directors shall receive compensation for his services as a member of the board or as a member of any committee. A director may be reimbursed for actual expenses incurred in the performance of responsibilities of director or as a member of any…

Section 21. The treasurer and all other officers and employees of a credit union having access to its cash or negotiable securities shall give bond to the credit union at its expense in such amounts and with such surety or sureties and conditions as the commissioner may prescribe…

Section 22. In addition to the duties imposed by law upon the treasurer of a credit union or the officer or employee thereof charged with the duties and functions usually preformed by the treasurer, he shall also be responsible for the performance of all acts and duties required …

Section 23. Any officer, director, agent or employee of any credit union, who knowingly and wilfully does any act forbidden to him or to such credit union by any provision of chapter one hundred and sixty-seven or one hundred and seventy-one, or who knowingly and wilfully aids or…

Section 24. A credit union may indemnify its directors, officers, employees and other agents to whatever extent specified in or authorized by a by-law adopted pursuant to law. Such indemnification may include payment by the credit union of expenses incurred in defending a civil o…

Section 25. A credit union may provide group life insurance, group accident and health insurance or group medical, surgical or hospital insurance or benefits or all or any combination thereof, for its employees, officers, and directors. Directors ineligible for the group benefit …

Section 26. Annually, not more than 30 days after the last business day of December, a credit union shall make a report to the commissioner in such form as the commissioner may prescribe accurately showing its condition at the close of business on that day and containing such oth…

Section 27. Each such corporation shall prepare a balance sheet, in accordance with generally accepted accounting principles, which presents fairly its condition as of the last business day of its fiscal year. A copy of said balance sheet shall be made available to a depositor up…

Section 28. Each credit union shall preserve all of its records of original and final entry, including cancelled checks and withdrawal and deposit slips, for a period of at least six years from the date of making the same or from the date of the last entry thereof. Such records s…

Section 29. The capital of a credit union shall be unlimited in amount and shall consist of shares and deposits. Shares shall be of a par value of not less than five dollars but not more than twenty-five dollars each and shall be subscribed and paid for in such manner as the by-l…

Section 3. A notice of the intention of the subscribers to form such a credit union shall be given to the commissioner. Credit unions shall be organized under the provisions of sections two to six, inclusive, after such notice and hearing, if any, as the commissioner may require.…

Section 30. Every member of a credit union shall hold 1 share and may hold shares or make deposits, or both, therein, in his own name and he may jointly, with one or more persons, hold shares or make deposits, or both. An organizational member may purchase shares or make deposits…

Section 31. A credit union may authorize accounts that would allow withdrawals by negotiable or transferable instruments for the purpose of making transfers to third parties. Such accounts shall be designated as negotiable withdrawal order accounts. Said accounts shall be subject…

Section 31A. A credit union may execute and deliver for a member such guarantees as may be incidental or usual in the transfer of investment securities.

Section 32. A share or deposit authorized by section 30 may, if the directors of the credit union so determine, be received as a term share or deposit, subject to this section. Notwithstanding any prior provisions of the law to the contrary, any such shares or deposits shall be r…

Section 32A. Notwithstanding any general or special law to the contrary, a credit union may accept a funeral trust account, as defined in regulations promulgated by the board of registration in embalming and funeral directing.

Section 32B. A natural person not more than 18 years of age or not less than 65 years of age may choose 1 demand deposit account and 1 savings account upon which no service, maintenance or other similar charge shall be imposed; provided, however, that any such demand deposit acco…

Section 35. A credit union may act as trustee or custodian under a profit-sharing plan instituted by a person, partnership or corporation within the meaning of section 401(a) of the Internal Revenue Code of 1954 including the provisions of P.L. 94–455. A credit union may act as t…

Section 36. Any designation of any beneficiary in connection with and as provided by an instrument intended to establish a pension, profit-sharing or other deferred compensation or retirement plan, trust or custodial account described in one or more of the following sections of t…

Section 37. A credit union may receive shares or deposits, under the terms of a written plan approved by the commissioner, from any labor union, association, trust, public utility, partnership, corporation, college, university, insurance company, charity, any city, town, county o…

Section 38. Any credit union may establish an account to receive deposits from a lessor acting as a trustee for funds received and held by such trustee pursuant to paragraph (a) of subsection (3) of section fifteen B of chapter one hundred and eighty-six. Such account may be esta…

Section 39. Shares and deposits may be received and held in the name of a member with one or more persons as joint tenants, payable to such member or his survivors, and any part or all of the shares or deposits and dividends or interest represented by joint accounts may be withdr…

Section 4. The first meeting of the incorporators shall be called by a notice signed either by the incorporator who is designated in the agreement for the purpose or by a majority of the incorporators, and such notice shall state the time, place and purposes of the meeting. Not l…

Section 40. Subject to the foregoing limitations in respect to shares and deposits and requirements relative to notice, shares may be subscribed for and deposits may be accepted in the name of one or two persons in trust for another provided the name and residence of the benefici…

Section 41. Shares may be issued and deposits received in the name of a minor, and such shares and deposits may, subject to the policy of the credit union, be withdrawn by such minor or by his parent or guardian and, in either case, payment made on such withdrawals shall be valid…

Section 41A. No credit union shall assess any fee, charge or other assessment against any account, established for personal, family or household purposes, of a depositor or shareholder who, as the payee of a check, draft or money order, of which the payee is not also the maker, d…

Section 42. Deposits or shares standing in the individual name of a deceased depositor or shareholder shall, except as otherwise provided in this chapter, be paid to his legal representative; but if the total of the deposits and shares does not exceed $10,000 and there has been n…

Section 43. A credit union may require from a shareholder or depositor ninety days' notice of his intention to withdraw any or all of his shares and sixty days' notice of his intention to withdraw any or all of his deposits.

Section 46. When a passbook or other instrument as evidence of a shareholder's or a depositor's account issued by any credit union has been lost, stolen or destroyed, the person in whose name it was issued, or in the case of a joint account, by the joint owners thereof may make w…

Section 47. Any agreement between a depositor or shareholder and any credit union which exculpates such credit union when an account, or any part thereof, is paid by such credit union to a person unlawfully presenting a passbook, or other instrument as evidence of such account is…

Section 48. A person indebted to a credit union may, when proceeded against for the collection of such indebtedness or for the enforcement of any security therefor, set off or recoup the amount of a deposit or shares in such credit union held and owned by him at the time of the c…

Section 49. Whenever a credit union, as a consequence of a default of a debt owed to said credit union by a depositor or shareholder, makes a transfer of funds of such depositor or shareholder to reduce or extinguish said debt, such depositor or shareholder shall be notified fort…

Section 5. The clerk or secretary and a majority of the directors elected at such first meeting shall make and sign, under penalties of perjury, articles of organization in duplicate, setting forth: (a) a true copy of the agreement of association, the names of the subscribers the…

Section 50. In the event that any shares or accounts which are pledged as security for any loan are sold, forfeited, transferred, assigned or credited for the non-performance of the conditions of such loan or on the foreclosure thereof or for any other lawful purpose, a duly auth…

Section 51. No credit union shall be required to recognize an adverse claim to shares or a deposit standing on its books to the credit of or for the account of any person, except by virtue of the service upon it of appropriate process issued by a court of competent jurisdiction i…

Section 52. The supreme judicial court or any justice thereof sitting in equity may, on petition of a credit union or the board of the credit union, approved by the commissioner, approve or order a reduction of the account of each shareholder or depositor therein whenever the val…

Section 53. For the purposes of this section, the following terms shall have the following meanings:— ''Account'', a (i) share, share certificate or share draft account of a member of a credit union or a nonmember served by a credit union serving predominantly low-income members,…

Section 57. The capital, deposits and surplus of a credit union shall be invested in loans to members, with approval of the credit committee, as provided in section seventeen and, when so required herein, of the board of directors. All applications for loans shall be made in writ…