95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008
SB0228

 

Introduced 2/7/2007, by Sen. Ira I. Silverstein

 

SYNOPSIS AS INTRODUCED:
 
205 ILCS 105/3-8   from Ch. 17, par. 3303-8

    Amends the Illinois Savings and Loan Act of 1985. Provides that an association may not disclose to any person, except to the member or holder of capital or his or her duly authorized agent, any financial records relating to that member or holder of capital of that association unless the financial records are disclosed in response to a lawful subpoena, summons, warrant, citation to discover assets, or court order that meets the requirements of specified criteria (now, a disclosure may only be made in response to a lawful subpoena, summons, warrant, or court order). Makes corresponding changes in provisions concerning disclosure procedures and the reimbursement of costs associated with disclosure compliance.


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A BILL FOR

 

SB0228 LRB095 07906 MJR 28068 b

1     AN ACT concerning regulation.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 5. The Illinois Savings and Loan Act of 1985 is
5 amended by changing Section 3-8 as follows:
 
6     (205 ILCS 105/3-8)  (from Ch. 17, par. 3303-8)
7     Sec. 3-8. Access to books and records; communication with
8 members.
9     (a) Every member or holder of capital shall have the right
10 to inspect the books and records of the association that
11 pertain to his account. Otherwise, the right of inspection and
12 examination of the books and records shall be limited as
13 provided in this Act, and no other person shall have access to
14 the books and records or shall be entitled to a list of the
15 members.
16     (b) For the purpose of this Section, the term "financial
17 records" means any original, any copy, or any summary of (i) a
18 document granting signature authority over a deposit or
19 account; (ii) a statement, ledger card, or other record on any
20 deposit or account that shows each transaction in or with
21 respect to that account; (iii) a check, draft, or money order
22 drawn on an association or issued and payable by an
23 association; or (iv) any other item containing information

 

 

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1 pertaining to any relationship established in the ordinary
2 course of an association's business between an association and
3 its customer, including financial statements or other
4 financial information provided by the member or holder of
5 capital.
6     (c) This Section does not prohibit:
7         (1) The preparation, examination, handling, or
8     maintenance of any financial records by any officer,
9     employee, or agent of an association having custody of
10     those records or the examination of those records by a
11     certified public accountant engaged by the association to
12     perform an independent audit.
13         (2) The examination of any financial records by, or the
14     furnishing of financial records by an association to, any
15     officer, employee, or agent of the Commissioner of Banks
16     and Real Estate or federal depository institution
17     regulator for use solely in the exercise of his duties as
18     an officer, employee, or agent.
19         (3) The publication of data furnished from financial
20     records relating to members or holders of capital where the
21     data cannot be identified to any particular member, holder
22     of capital, or account.
23         (4) The making of reports or returns required under
24     Chapter 61 of the Internal Revenue Code of 1986.
25         (5) Furnishing information concerning the dishonor of
26     any negotiable instrument permitted to be disclosed under

 

 

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1     the Uniform Commercial Code.
2         (6) The exchange in the regular course of business of
3     (i) credit information between an association and other
4     associations or financial institutions or commercial
5     enterprises, directly or through a consumer reporting
6     agency or (ii) financial records or information derived
7     from financial records between an association and other
8     associations or financial institutions or commercial
9     enterprises for the purpose of conducting due diligence
10     pursuant to a purchase or sale involving the association or
11     assets or liabilities of the association.
12         (7) The furnishing of information to the appropriate
13     law enforcement authorities where the association
14     reasonably believes it has been the victim of a crime.
15         (8) The furnishing of information pursuant to the
16     Uniform Disposition of Unclaimed Property Act.
17         (9) The furnishing of information pursuant to the
18     Illinois Income Tax Act and the Illinois Estate and
19     Generation-Skipping Transfer Tax Act.
20         (10) The furnishing of information pursuant to the
21     federal "Currency and Foreign Transactions Reporting Act",
22     (Title 31, United States Code, Section 1051 et seq.).
23         (11) The furnishing of information pursuant to any
24     other statute that by its terms or by regulations
25     promulgated thereunder requires the disclosure of
26     financial records other than by subpoena, summons,

 

 

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1     warrant, or court order.
2         (12) The exchange of information between an
3     association and an affiliate of the association; as used in
4     this item, "affiliate" includes any company, partnership,
5     or organization that controls, is controlled by, or is
6     under common control with an association.
7         (13) The furnishing of information in accordance with
8     the federal Personal Responsibility and Work Opportunity
9     Reconciliation Act of 1996. Any association governed by
10     this Act shall enter into an agreement for data exchanges
11     with a State agency provided the State agency pays to the
12     association a reasonable fee not to exceed its actual cost
13     incurred. An association providing information in
14     accordance with this item shall not be liable to any
15     account holder or other person for any disclosure of
16     information to a State agency, for encumbering or
17     surrendering any assets held by the association in response
18     to a lien or order to withhold and deliver issued by a
19     State agency, or for any other action taken pursuant to
20     this item, including individual or mechanical errors,
21     provided the action does not constitute gross negligence or
22     willful misconduct. An association shall have no
23     obligation to hold, encumber, or surrender assets until it
24     has been served with a subpoena, summons, warrant, court or
25     administrative order, lien, or levy.
26         (14) The furnishing of information to law enforcement

 

 

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1     authorities, the Illinois Department on Aging and its
2     regional administrative and provider agencies, the
3     Department of Human Services Office of Inspector General,
4     or public guardians: (i) upon subpoena by the investigatory
5     entity or the guardian, or (ii) if there is suspicion by
6     the association that a customer who is an elderly or
7     disabled person has been or may become the victim of
8     financial exploitation. For the purposes of this item (14),
9     the term: (i) "elderly person" means a person who is 60 or
10     more years of age, (ii) "disabled person" means a person
11     who has or reasonably appears to the association to have a
12     physical or mental disability that impairs his or her
13     ability to seek or obtain protection from or prevent
14     financial exploitation, and (iii) "financial exploitation"
15     means tortious or illegal use of the assets or resources of
16     an elderly or disabled person, and includes, without
17     limitation, misappropriation of the elderly or disabled
18     person's assets or resources by undue influence, breach of
19     fiduciary relationship, intimidation, fraud, deception,
20     extortion, or the use of assets or resources in any manner
21     contrary to law. An association or person furnishing
22     information pursuant to this item (14) shall be entitled to
23     the same rights and protections as a person furnishing
24     information under the Elder Abuse and Neglect Act, the
25     Illinois Domestic Violence Act of 1986, and the Abuse of
26     Adults with Disabilities Intervention Act.

 

 

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1         (15) The disclosure of financial records or
2     information as necessary to effect, administer, or enforce
3     a transaction requested or authorized by the member or
4     holder of capital, or in connection with:
5             (A) servicing or processing a financial product or
6         service requested or authorized by the member or holder
7         of capital;
8             (B) maintaining or servicing an account of a member
9         or holder of capital with the association; or
10             (C) a proposed or actual securitization or
11         secondary market sale (including sales of servicing
12         rights) related to a transaction of a member or holder
13         of capital.
14         Nothing in this item (15), however, authorizes the sale
15     of the financial records or information of a member or
16     holder of capital without the consent of the member or
17     holder of capital.
18         (16) The disclosure of financial records or
19     information as necessary to protect against or prevent
20     actual or potential fraud, unauthorized transactions,
21     claims, or other liability.
22         (17)(a) The disclosure of financial records or
23     information related to a private label credit program
24     between a financial institution and a private label party
25     in connection with that private label credit program. Such
26     information is limited to outstanding balance, available

 

 

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1     credit, payment and performance and account history,
2     product references, purchase information, and information
3     related to the identity of the customer.
4         (b)(l) For purposes of this paragraph (17) of
5     subsection (c) of Section 3-8, a "private label credit
6     program" means a credit program involving a financial
7     institution and a private label party that is used by a
8     customer of the financial institution and the private label
9     party primarily for payment for goods or services sold,
10     manufactured, or distributed by a private label party.
11         (2) For purposes of this paragraph (17) of subsection
12     (c) of Section 3-8, a "private label party" means, with
13     respect to a private label credit program, any of the
14     following: a retailer, a merchant, a manufacturer, a trade
15     group, or any such person's affiliate, subsidiary, member,
16     agent, or service provider.
17     (d) An association may not disclose to any person, except
18 to the member or holder of capital or his duly authorized
19 agent, any financial records relating to that member or holder
20 of capital of that association unless:
21         (1) The member or holder of capital has authorized
22     disclosure to the person; or
23         (2) The financial records are disclosed in response to
24     a lawful subpoena, summons, warrant, citation to discover
25     assets, or court order that meets the requirements of
26     subsection (e) of this Section.

 

 

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1     (e) An association shall disclose financial records under
2 subsection (d) of this Section pursuant to a lawful subpoena,
3 summons, warrant, citation to discover assets, or court order
4 only after the association mails a copy of the subpoena,
5 summons, warrant, or court order to the person establishing the
6 relationship with the association, if living, and, otherwise,
7 his personal representative, if known, at his last known
8 address by first class mail, postage prepaid, unless the
9 association is specifically prohibited from notifying that
10 person by order of court.
11     (f)(1) Any officer or employee of an association who
12 knowingly and willfully furnishes financial records in
13 violation of this Section is guilty of a business offense and,
14 upon conviction, shall be fined not more than $1,000.
15     (2) Any person who knowingly and willfully induces or
16 attempts to induce any officer or employee of an association to
17 disclose financial records in violation of this Section is
18 guilty of a business offense and, upon conviction, shall be
19 fined not more than $1,000.
20     (g) However, if any member desires to communicate with the
21 other members of the association with reference to any question
22 pending or to be presented at a meeting of the members, the
23 association shall give him upon request a statement of the
24 approximate number of members entitled to vote at the meeting
25 and an estimate of the cost of preparing and mailing the
26 communication. The requesting member then shall submit the

 

 

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1 communication to the Commissioner who, if he finds it to be
2 appropriate and truthful, shall direct that it be prepared and
3 mailed to the members upon the requesting member's payment or
4 adequate provision for payment of the expenses of preparation
5 and mailing.
6     (h) An association shall be reimbursed for costs that are
7 necessary and that have been directly incurred in searching
8 for, reproducing, or transporting books, papers, records, or
9 other data of a customer required to be reproduced pursuant to
10 a lawful subpoena, warrant, citation to discover assets, or
11 court order.
12 (Source: P.A. 93-271, eff. 7-22-03; 94-495, eff. 8-8-05;
13 94-851, eff. 6-13-06.)