North Dakota Administrative Code

union service organizations. State credit unions may invest in credit union service organizations or subsidiary credit union service organizations, subject to the limitation provided for in this chapter and subject to approval by order of the board. History: Effective January 1, …

Unless the context otherwise requires, terms in this chapter have the following meanings: 1. "Affiliated" means those credit unions that have either invested in or made loans to a credit union service organization. 2. "Credit union service organization" means a financial service …

An application to establish, make an initial investment, or increase the amount of an investment in a credit union service organization must be submitted to the commissioner in writing and must contain the following: 1. A full explanation and complete documentation of the propose…

A public hearing by the board may be required on applications to invest in credit union service organizations whenever the board or commissioner determines that it is in the public interest to hold such a hearing or whenever a credit union or party requests an opportunity to be h…

1. A state credit union, upon being granted authority under section 13-03-23-03, and complying with all applicable state licensing requirements, may invest in those credit union service organizations or subsidiary credit union service organizaitons that provide one or more of the…

or subsidiary credit union service organizations. The following limitations apply to state credit unions for investments in credit union service organizations or subsidiary credit union service organizations: 1. A credit union may not invest in shares, stocks, or obligations of c…

Individuals who serve as officials or senior management employees of an affiliated state credit union, and immediate family members of such individuals, may not receive any salary, commission, investment income, or other income or compensation from a credit union service organiza…

A credit union shall allow the commissioner or the commissioner's examiner, at the commissioner's discretion, to inspect or examine all the books or records of the credit union service organization and subsidiary credit union service organization for the purpose of determining co…

service organization. 1. A credit union and a credit union service organization or subsidiary credit union service organization must be operated in a manner that demonstrates to the public the separate corporate existence of the credit union and the credit union service organizat…

All credit unions are required to have a fidelity bond for credit union employees and officials and for other insurance coverage for losses such as theft, holdup, vandalism, and similar losses caused by persons outside the credit union. History: Effective January 1, 2007. General…

1. The board of directors of each credit union must at least annually review its fidelity and other insurance coverage to ensure that it is adequate in relation to the potential risks facing the credit union and the minimum requirements set by the state credit union board. 2. The…

At a minimum, the bond coverage must: 1. Be purchased in an individual policy from a company holding a certificate of authority from the secretary of the treasury. 2. Include fidelity bonds that cover fraud and dishonesty by all employees, directors, officers, supervisory committ…

1. The minimum required amount of fidelity bond coverage for any single loss is computed based upon a credit union's total assets. Assets Minimum Bond $0 to $4,000,000 Lesser of total assets or $250,000 $4,000,001 to $50,000,000 $100,000 plus $50,000 for each million or fraction …

1. The maximum amount of allowable deductibles is computed based on a credit union's asset size, as follows: Assets Maximum Deductible $0 - $100,000 No deductibles allowed $100,001 - $250,000 $1,000 $250,001 - $1,000,000 $2,000 Over $1,000,000 $2,000 plus 1/1000 of total assets u…

The state credit union board may require additional coverage when the board determines that a credit union's current coverage is inadequate. The credit union must purchase this additional coverage within thirty days. History: Effective January 1, 2007. General Authority: NDCC 6-0…

1. "Compensated person" means any accounting or auditing professional, excluding a credit union employee, who is compensated for performing more than one supervisory committee audit or verification of members' accounts per calendar year, or both. 2. "Confirm" or "confirmation" re…

1. Basic. The supervisory committee is responsible for ensuring that the board of directors and management of the credit union: a. Meet required financial reporting objectives; and b. Establish practices and procedures sufficient to safeguard members' assets. 2. Specific. To carr…

1. Annual audit requirement. A credit union is required to obtain an annual supervisory committee audit or financial statement audit that occurs at least once every calendar year (period of performance) and must cover the period elapsed since the last audit period (period effecti…

1. Verification obligation. The supervisory committee, at least every two years, shall cause the accounts of members to be verified against the records of the treasurer of the credit union. 2. Methods. Any of the following methods may be used to verify members' passbooks and acco…

1. Unrelated to officials. A compensated auditor who performs a supervisory committee audit on behalf of a credit union may not be related by blood or marriage to any management employee, member of either the board of directors, the supervisory committee, or the credit committee,…

1. Audit report. Upon completion or receipt, or both, of the written report of a financial statement audit or a supervisory committee audit, the supervisory committee must verify that the audit was performed and reported in accordance with the terms of the engagement letter presc…

Failure of a supervisory committee or its independent compensated auditor or other person, or any of them, to comply with the requirements of this section, or the terms of the engagement letter required by this section, is ground for: 6 1. The commissioner to reject the superviso…

1. Audit by alternative licensed person. The state credit union board may compel a credit union to obtain a supervisory committee audit which meets the minimum requirements of section 13-03-25-03 and which is performed by an independent person who is licensed by the state for any…

1. "Gap analysis" is a simple interest rate risk measurement method that reports the mismatch between rate sensitive assets and rate sensitive liabilities over a given time period. Gap can only suffice for simple balance sheets that primarily consist of short-term bullet type inv…

1. Any credit union that has assets of less than fifty million dollars must maintain a basic written policy that provides a credit union board-approved framework for managing interest rate risk. 2. Any credit union that has assets of fifty million dollars or more is required to h…

1. Any credit union that has assets of less than fifty million dollars shall maintain a basic written policy that provides a credit union board-approved framework for managing liquidity and a list of contingent liquidity sources that can be employed under adverse circumstances. 2…

1. "Cash basis" method of income recognition is set forth in generally accepted accounting principles and means while a loan is in nonaccrual status, some or all of the cash interest payments received may be treated as interest income on a cash basis as long as the remaining reco…

1. The board and management shall adopt and adhere to an explicit written policy and standards that control the use of loan workouts, and establish controls to ensure the policy is consistently applied. These policies must: a. Be commensurate with the size and complexity of the c…

status. 1. The past due status of all loans must be calculated consistent with loan contract terms, including amendments made to loan terms through a formal restructure. Credit unions shall report delinquency on the call report consistent with this policy. 2. Troubled debt restru…

1. Policy or procedure must prohibit the accrual of interest or fees on any loan upon which principal or interest has been in default for a period of ninety days or more. 2. Policy or procedure must require loans to be placed in nonaccrual status if maintained on a cash or cost r…

1. "Debt collector" means any collection agency, employee of a collection agency, and any person engaging, directly or indirectly, in debt collection, and includes any person who sells, or offers to sell, forms represented to be a collection system, device, or scheme, intended or…

No collection agency or debt collector shall: 1. Publish or cause to be published any list of debtors, except for credit reporting purposes, advertise or threaten to advertise for sale any debt as a means of forcing payment thereof, or use similar devices or methods of intimidati…

Licensed collection agencies may only appoint debt collectors who are of good moral character, are knowledgeable in collection agency practices and ethics, have a good credit reputation, and have a reputation for fair and honest dealings. The name and address of a person appointe…

No debt collector may: 1. Perform legal services, furnish legal advice, or falsely represent, directly or by implication, that the debt collector is an attorney. 2. Solicit assignments of claims for the purpose of suit or at the instigation of an attorney. 3. Institute judicial p…

No debt collector may collect or attempt to collect any debt by means of any threat, coercion, or attempt to coerce. Without limiting the general application of the foregoing, no debt collector may: 1. Use, or expressly or implicitly threaten the use of violence or other criminal…

No debt collector may oppress, harass, or abuse any person in connection with the collection of or attempt to collect any debt alleged to be due and owing by that person or another. Without limiting the general application of the foregoing, no debt collector may: 1. Use profane o…

No debt collector may unreasonably publicize information relating to any alleged indebtedness or debtor. Without limiting the general application of the foregoing, no debt collector may: 1. Communicate any information relating to a debtor's indebtedness to any employer or the emp…

No debt collector may use any fraudulent, deceptive, or misleading representation or means to collect or attempt to collect debts or to obtain information concerning debtors. Without limiting the general application of the foregoing, no debt collector may: 1. Use any name while e…

No debt collector may use unfair or unconscionable means to collect or attempt to collect any debt. Without limiting the general application of the foregoing, no debt collector may: 1. Seek or obtain any written statement or acknowledgment in any form that specifies that a debtor…

No debt collector may use, distribute, sell, or prepare for use, any written communication that violates or fails to conform to United States postal laws and regulations. History: Amended effective July 1, 1984. General Authority: NDCC 13-05-06 Law Implemented: NDCC 13-05-06

The client's share of collections must be deposited into a trust account in a financial institution insured by a federal agency within forty-eight hours. History: Amended effective July 1, 1984. General Authority: NDCC 13-05-06 Law Implemented: NDCC 13-05-07

Disbursements of twenty-five dollars or more from the trust account to clients must be made no later than thirty days after the monthly closing for the month in which the money was collected. Disbursements of less than twenty-five dollars must be made no later than sixty days aft…

No debt collector may accept currency or coin as payment for a debt without issuing an original receipt to the debtor and maintaining a duplicate receipt as a part of the debt collector's permanent records. History: Effective July 1, 1984; amended effective April 1, 2013. General…

A collection agency, upon a written or oral request by the debtor, shall provide a written statement to the debtor indicating the current balance of the remaining debt, the total of all interest charged, and a record of all payments applied to that debt. The statement must includ…

Maintain a high standard of business principles and never be guilty of conduct which will bring reproach upon the industry or the commissioner of financial institutions. History: Amended effective June 1, 2002. General Authority: NDCC 13-05-06 Law Implemented: NDCC 13-05-06(3)

Not have been engaged or be engaged in any activities supporting or aiding any organization that advocates the overthrow of the constitutionally established government of its country. General Authority: NDCC 13-05-06 Law Implemented: NDCC 13-05-06(3)

Comply with all city, county, state, and federal laws relating to the ownership and operation of a collection business and provision of collection services. General Authority: NDCC 13-05-06 Law Implemented: NDCC 13-05-06(3)

Do business under a designation or business name or identification that does not mislead creditors, consumers, or the general public into believing that it is some other type of business than it is. General Authority: NDCC 13-05-06 Law Implemented: NDCC 13-05-06(3)

Operate under a name or in any manner which does not imply that such agency is a branch of or associated with any department of the federal government or of any state or municipal government, and refrain from using any seal, insignia, envelope, or other device which simulates tha…

Ensure that all personnel are familiar with the laws under which the collection business is conducted, the rules and regulations, and the code of ethics and that they fully respond to and comply with them. General Authority: NDCC 13-05-06 Law Implemented: NDCC 13-05-06(3)