(205 ILCS 620/Art. I heading) ARTICLE I.
GENERAL PROVISIONS
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(205 ILCS 620/1-1) (from Ch. 17, par. 1551-1)
Sec. 1-1.
Short Title.
This Act shall be known and may
be cited as the "Corporate Fiduciary Act".
(Source: P.A. 85-858.)
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(205 ILCS 620/1-2) (from Ch. 17, par. 1551-2)
Sec. 1-2.
Policy of Act.
The General Assembly finds
that corporate fiduciaries perform a vital service in the
administration of trusts, guardianship, receiverships, estates
and other fiduciary capacities; that it is in the public
interest that prior to accepting any fiduciary appointment, a
corporate fiduciary meet minimum qualifications with respect to
financial capacity as well as managerial competence and
integrity; that the operation of a corporate fiduciary is
impressed with a public interest such that it should be
supervised as an activity affecting the general welfare of the
people of the State of Illinois; and that a corporate fiduciary
should obtain its authority, conduct its operations and be
supervised as provided in this Act.
(Source: P.A. 90-655, eff. 7-30-98.)
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(205 ILCS 620/1-3) (from Ch. 17, par. 1551-3)
Sec. 1-3.
Scope of Act; application to national banks,
federally chartered savings and loan associations or federally
chartered savings banks. After January 1, 1988, no national bank
chartered by the Comptroller of the Currency and having its main office
in Illinois or federal savings
and loan association or federal savings bank chartered by the
Federal Home Loan Bank Board and having its main office in Illinois
shall be required to obtain a
certificate of authority under this Act or in any manner submit
to the regulation or supervision pursuant to this Act, but such
national bank, federal savings and loan association or federal
savings bank shall only be required to obtain the authority to
accept and execute trusts from the particular federal agency
which granted its charter, to be exempt from the provisions of
this Act.
Nothing in this Section 1-3 shall exempt national banks, federal savings
and loan associations or federal savings banks whose main offices are
located outside of Illinois from compliance with the provisions of Article
IV of this Act.
On January 1, 1988, any certificate of authority which has
been issued under the provisions of this Act to a national bank,
federally chartered savings and loan association or federally
chartered savings bank in Illinois shall expire and be of no
further force and effect and upon the request of the
Commissioner, shall be surrendered.
After January 1, 1988, a State bank that has a
certificate
of authority under this Act and proposes to convert to a
national bank and a State chartered savings and loan association
and a State chartered savings bank that has a certificate of authority under
this Act and proposes to convert to a federally chartered savings
and
loan association or federally chartered savings bank, shall
notify the Commissioner of such fact and upon obtaining its
charter from the relevant federal regulator, shall surrender its
certificate of authority issued pursuant to this Act.
(Source: P.A. 91-97, eff. 7-9-99.)
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(205 ILCS 620/1-4) (from Ch. 17, par. 1551-4)
Sec. 1-4.
Effect on existing corporate fiduciaries.
With respect to any existing corporate fiduciary:
(a) any existing certificate of authority shall continue in
full force and effect except as provided in Section 1-3 of this
Act;
(b) all existing appointments in any fiduciary capacity and
any existing contracts by such corporate fiduciary shall continue
in full force and effect; and
(c) no corporate fiduciary which holds a current and valid
certificate of authority under this Act shall be required to
submit an application to obtain a certificate of authority unless
the certificate of authority of such corporate fiduciary
subsequently shall have been relinquished or revoked and such
corporate fiduciary thereafter seeks to again obtain a
certificate of authority.
(Source: P.A. 85-858.)
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(205 ILCS 620/1-5) (from Ch. 17, par. 1551-5)
Sec. 1-5.
Definitions.
The words and phrases defined in
Sections following this Section and preceding Section 1-6 have the meanings
ascribed to them
in those Sections, except to the extent that any such word or
phrase is specifically qualified by its context.
(Source: P.A. 89-364, eff. 8-18-95.)
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(205 ILCS 620/1-5.01) (from Ch. 17, par. 1551-5.01)
Sec. 1-5.01.
"Bank" shall have the same meaning ascribed
to the term in Section 2 of the Illinois Banking Act.
(Source: P.A. 85-858.)
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(205 ILCS 620/1-5.02) (from Ch. 17, par. 1551-5.02)
Sec. 1-5.02.
"Capital" shall have the meaning ascribed to the term "capital"
or "paid-in capital" in the particular Act under which the corporate fiduciary
was organized and received its charter or certificate of incorporation.
(Source: P.A. 88-408.)
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(205 ILCS 620/1-5.03) (from Ch. 17, par. 1551-5.03)
Sec. 1-5.03.
"Commissioner" means the Secretary of Financial and Professional Regulation or a person authorized by the Secretary, the Division of Banking Act, or this Act to act in the Secretary's stead, and, beginning on January 1, 2011 (the effective date of Public Act 96-1163), all references in this Act to the Commissioner of Banks and Real Estate are deemed, in appropriate contexts, to be references to the Secretary of Financial and Professional Regulation.
(Source: P.A. 96-1163, eff. 1-1-11; 96-1365, eff. 7-28-10; 97-333, eff. 8-12-11.)
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(205 ILCS 620/1-5.04)
Sec. 1-5.04. (Repealed).
(Source: P.A. 85-858. Repealed by P.A. 97-492, eff. 1-1-12.)
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(205 ILCS 620/1-5.05) (from Ch. 17, par. 1551-5.05)
Sec. 1-5.05.
Corporate fiduciary.
"Corporate fiduciary" means a trust
company; the trust department of a bank, savings bank,
savings and loan association, or foreign banking corporation issued a
certificate of authority pursuant to the Foreign Banking Office Act; or
any person that is required to and has received a
certificate of
authority
under this Act authorizing the exercise of trust powers.
The term "corporate fiduciary" also includes a national bank or federally
chartered savings and loan association or savings bank which is authorized
by the appropriate federal agency to accept and execute trusts and which
has its principal place of business in this State, whenever in this Act
such construction is necessary so that the national bank or federally
chartered savings and loan association or savings bank may enjoy and
exercise in this State all of the powers, rights and privileges authorized
or permitted to a corporate fiduciary holding a certificate of authority
under this Act.
(Source: P.A. 89-364, eff. 8-18-95; 89-567, eff. 7-26-96.)
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(205 ILCS 620/1-5.06) (from Ch. 17, par. 1551-5.06)
Sec. 1-5.06.
"Court" means a court of competent
jurisdiction.
(Source: P.A. 85-858.)
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(205 ILCS 620/1-5.07) (from Ch. 17, par. 1551-5.07)
Sec. 1-5.07.
"Depository institution" includes banks,
savings and loan associations, savings banks, and credit unions.
(Source: P.A. 91-97, eff. 7-9-99.)
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(205 ILCS 620/1-5.07a) Sec. 1-5.07a. Division of Banking. "Division of Banking" means the Division of Banking of the Department of Financial and Professional Regulation.
(Source: P.A. 96-1163, eff. 1-1-11.) |
(205 ILCS 620/1-5.07b) Sec. 1-5.07b. Division. "Division" means the Division of Banking within the Department of Financial and Professional Regulation.
(Source: P.A. 96-1365, eff. 7-28-10; 97-333, eff. 8-12-11.) |
(205 ILCS 620/1-5.075) (This Section was renumbered as Section 1-5.07b by P.A. 97-333.) Sec. 1-5.075. (Renumbered).
(Source: P.A. 96-1365, eff. 7-28-10. Renumbered by P.A. 97-333, eff. 8-12-11.) |
(205 ILCS 620/1-5.08) (from Ch. 17, par. 1551-5.08)
Sec. 1-5.08.
"Foreign corporation" means:
(a) any bank, savings and loan association, savings bank, or other
corporation now or hereafter organized under the laws of any
state or territory of the United States of America, including the
District of Columbia, other than the State of Illinois;
(b) any national banking association having its principal
place of business in any state or territory of the United States
of America, including the District of Columbia, other than the
State of Illinois; and
(c) any federal savings and loan association or federal
savings bank having its principal place of business in any state
or territory of the United States of America, including the
District of Columbia, other than the State of Illinois.
(Source: P.A. 91-97, eff. 7-9-99.)
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(205 ILCS 620/1-5.09) (from Ch. 17, par. 1551-5.09)
Sec. 1-5.09.
"Person" means an individual, corporation,
partnership, joint venture, trust estate, limited liability company, or
unincorporated
association.
(Source: P.A. 90-424, eff. 1-1-98.)
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(205 ILCS 620/1-5.09a) Sec. 1-5.09a. Secretary. "Secretary" means the Secretary of Financial and Professional Regulation, or a person authorized by the Secretary or by this Act to act in the Secretary's stead.
(Source: P.A. 96-1163, eff. 1-1-11.) |
(205 ILCS 620/1-5.10) (from Ch. 17, par. 1551-5.10)
Sec. 1-5.10.
"Surplus" means the aggregate of (i) amounts paid in
excess of the par value of capital stock and preferred stock; (ii) amounts
contributed other than for capital stock and preferred stock and allocated
to the surplus account; and (iii) amounts transferred from undivided profits.
(Source: P.A. 86-754.)
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(205 ILCS 620/1-5.11) (from Ch. 17, par. 1551-5.11)
Sec. 1-5.11.
Trust company.
"Trust company" means a corporation
incorporated or a limited liability company organized in this State that
holds a certificate of authority issued
pursuant to this Act.
(Source: P.A. 89-364, eff. 8-18-95; 90-424, eff. 1-1-98.)
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(205 ILCS 620/1-5.12)
Sec. 1-5.12.
Fiduciary.
"Fiduciary" means trustee, executor,
administrator, receiver, guardian, assignee for the benefit of creditors, or
any holder of a similar position of trust.
(Source: P.A. 89-364, eff. 8-18-95.)
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(205 ILCS 620/1-5.13)
Sec. 1-5.13.
Trust business.
"Trust business" means the holding out by a
person to the public by advertising, solicitation, or other means that the
person is available to act as a fiduciary in this State, or the accepting or
undertaking to perform the duties of a fiduciary as a significant part of its
regular business.
(Source: P.A. 89-364, eff. 8-18-95.)
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(205 ILCS 620/1-5.14)
Sec. 1-5.14.
Compliance period.
A person who becomes a fiduciary or who
becomes engaged in the trust business and thereby is required to obtain a
certificate of authority from the Commissioner either by the coming into force
of this amendatory Act of 1995 or by the loss of an exemption listed in or by
rule authorized under Section 2-4.5 of this Act shall have 180 days to either
liquidate
the fiduciary or trust business or to obtain a certificate from the
Commissioner. During this 180-day period the person shall not be guilty of a
Class A misdemeanor.
(Source: P.A. 89-364, eff. 8-18-95.)
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(205 ILCS 620/1-6) (from Ch. 17, par. 1551-6)
Sec. 1-6. General corporate powers. A corporate
fiduciary shall have the powers:
(a) if it is a State bank, those powers granted under | ||
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(b) if it is a State savings and loan association, | ||
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(c) if it is a State savings bank, those powers | ||
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(d) if it is a corporation organized under the | ||
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(e) subject to Article XLIV of the Illinois Insurance | ||
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The Commissioner may specify powers of corporate fiduciaries generally
or of a particular corporate fiduciary and
by rule or order limit or restrict such powers of corporate
fiduciaries or a particular corporate fiduciary if he finds the exercise of
such power by corporate fiduciaries generally or of the corporate
fiduciary in particular may tend to be an unsafe or unsound practice, or if
such power is otherwise not in the interest of beneficiaries of
any fiduciary appointment.
(Source: P.A. 101-48, eff. 1-1-20.)
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(205 ILCS 620/1-6a)
Sec. 1-6a.
Non-English language transactions.
A corporate fiduciary may
conduct
transactions in a language other than English through an employee or agent
acting as interpreter or through an interpreter provided by the customer.
(Source: P.A. 92-578, eff. 6-26-02.)
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(205 ILCS 620/1-7) (from Ch. 17, par. 1551-7)
Sec. 1-7. Office locations; corporate fiduciaries.
(a) Any corporate fiduciary may establish branch offices at any
location. Any corporate fiduciary that seeks to establish a branch office
shall, if it is a trust company, apply for and obtain approval for the
branch office from the Secretary.
(b) Any trust company that proposes to establish a subsidiary,
whether by incorporating the subsidiary or by acquiring the subsidiary,
shall apply for and obtain prior approval from the Secretary 60 days
prior to commencing business by the subsidiary, if newly incorporated, or
prior to its acquisition, if it is acquired, provided the Secretary may
specify circumstances and conditions when a trust company may directly or
indirectly acquire a subsidiary without prior approval.
(Source: P.A. 100-48, eff. 8-11-17.)
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(205 ILCS 620/1-8) (from Ch. 17, par. 1551-8)
Sec. 1-8.
Change of name or location.
A corporate fiduciary holding a
certificate of authority
issued pursuant to this Act must notify and receive written approval from
the Commissioner before changing its name or changing the location of its
corporate headquarters. A corporate fiduciary which is a State bank
chartered by the Commissioner and which accomplishes a change of name in
compliance with Section 13 of the Illinois Banking Act or a
change of location in compliance with Section 13 of the Illinois
Banking
Act, as now or hereafter amended, shall be deemed to have complied with
this Section 1-8.
(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/1-9)
Sec. 1-9.
Name indicating fiduciary capacity; limitation.
No corporation
that is not a corporate fiduciary as defined in Section 1-5.05 of this Act or a
foreign corporation having received a certificate of authority under Section
4-5 of this Act shall be allowed to use the word "trust", "trustee", or
"fiduciary" in its corporate name unless the Commissioner has approved that use
after finding that the corporation will not be engaged in business as a
corporate fiduciary and that the use of the word "trust", "trustee", or
"fiduciary" by the corporation will not be misleading to the public.
(Source: P.A. 88-408.)
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(205 ILCS 620/Art. II heading) ARTICLE II.
CERTIFICATE OF AUTHORITY AND ORGANIZATION
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(205 ILCS 620/2-1) (from Ch. 17, par. 1552-1)
Sec. 2-1.
(a) Any corporation which has been or shall be
incorporated under the general corporation laws of this State for
the purpose of accepting and executing trusts, and any state
bank, state savings and loan association, state savings bank, or
other special corporation now or hereafter authorized by law to
accept or execute trusts, may be appointed to act as a fiduciary
in any capacity a natural person or corporation may act, and
shall include, but not be limited to, acting as assignee or trustee
by deed, and executor, guardian or trustee by will, custodian
under the Illinois Uniform Transfers to Minors Act and such appointment
shall be of like force as in case of appointment of a natural
person and shall be designated a corporate fiduciary.
(b) No corporate fiduciary shall dissolve or cease its corporate
existence without prior notice to and approval by the Commissioner and
compliance with the requirements of Section 7-1 of this Act.
(Source: P.A. 100-863, eff. 8-14-18.)
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(205 ILCS 620/2-2) (from Ch. 17, par. 1552-2)
Sec. 2-2.
(a) Whenever application shall be made to any
court in this State for the appointment of any receiver,
assignee, guardian, executor, administrator or other trustee or
fiduciary appointed by the court, it shall be lawful for such
court to appoint any corporate fiduciary as such trustee,
fiduciary, receiver, assignee, guardian, executor or
administrator. Provided, any such appointment as guardian shall
apply to the estate only, and not to the person.
(b) Any court having appointed and having jurisdiction of
any receiver, executor, administrator, guardian, assignee or
other trustee or fiduciary appointed by the court, upon the
application of such officer, trustee or fiduciary, or upon the
application of any person having an interest in the estate
administered by such officer, trustee or fiduciary, after such
notice to the other parties in interest as the court may direct,
and after a hearing upon such application, may order such
officer, trustee or fiduciary to deposit any moneys then in his,
her or its custody, or which may come into his, her or its
custody thereafter, and until the further order of the court,
with any corporate fiduciary, and upon deposit of such money, and
its receipt and acceptance by the corporate fiduciary, the
officer, trustee or fiduciary shall be discharged from further
care or responsibility therefor. Such deposits shall be paid out
only upon the orders of said court.
(c) Whenever, in the judgment of any court having
jurisdiction of any estate in process of administration by any
assignee, receiver, executor, administrator, guardian, or other
trustee or fiduciary, the bond required by law of such officer
shall seem burdensome or excessive, upon application of such
officer, trustee or fiduciary, and after such notice to the
parties in interest as the court shall direct, and after a
hearing on such application, the court may order the officer,
trustee or fiduciary to deposit with any corporate fiduciary for
safe keeping, such portion or all of the personal assets of the
estate as it shall deem proper, and thereupon, the court shall,
by an order entered of record, reduce the bond to be given, or
theretofore given by such officer, trustee or fiduciary, so as to
cover only the estate remaining in the custody of the officer,
trustee or fiduciary, and the property as deposited shall
thereupon be held by the corporate fiduciary under the orders and
directions of the court.
(Source: P.A. 85-858.)
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(205 ILCS 620/2-3) (from Ch. 17, par. 1552-3)
Sec. 2-3.
Corporate fiduciaries shall be entitled to and
shall be allowed reasonable compensation for all the services
performed by them under the provisions of this Act and the
corporate fiduciary shall be reimbursed for all proper expenses
incurred in the performance of their duties under this Act.
(Source: P.A. 85-858.)
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(205 ILCS 620/2-4) (from Ch. 17, par. 1552-4)
Sec. 2-4.
Certificate of authority.
(a) It shall not be lawful for any person to engage in the trust
business, after the effective date of this amendatory Act of 1995, without
first filing an application for and procuring from the
Commissioner, a certificate of authority stating that such
person has complied with the requirements of this
Act and is qualified to engage in the trust business.
(b) No natural person or natural persons, firm or partnership, or
corporation not having been authorized under this Act shall transact a trust
business. A person who violates this Section is guilty
of a Class A misdemeanor, and the Attorney General or State's Attorney of the
county in which the violation occurs may restrain the violation by a complaint
for injunctive relief.
(Source: P.A. 89-364, eff. 8-18-95.)
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(205 ILCS 620/2-4.5)
Sec. 2-4.5.
Exemptions.
For the purposes of this Act, a person does not
engage in the trust business by:
(1) the rendering of fiduciary services by an attorney-at-law admitted to
the
practice of law in this State;
(2) rendering services as a certified or registered public accountant in the
performance of duties as such;
(3) acting as a trustee or receiver in bankruptcy;
(4) engaging in the business of an escrow agent;
(5) receiving rents and proceeds of sale as a licensed real estate broker on
behalf of the principal;
(6) acting as trustee under a deed of trust made only as security for the
payment of money or for the performance of another act;
(7) acting in accordance with its authorized powers as a religious,
charitable, educational, or other not-for-profit corporation or as a charitable
trust or as an unincorporated religious organization;
(8) engaging in securities transactions as a dealer or salesman;
(9) acting as either a receiver under the supervision of a court or as
an assignee for the benefit of creditors under the supervision of a court;
or
(10) engaging in such other activities that the Commissioner may prescribe
by
rule.
(Source: P.A. 89-364, eff. 8-18-95.)
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(205 ILCS 620/2-5) (from Ch. 17, par. 1552-5)
Sec. 2-5.
The application for a certificate of authority
shall be filed with the Commissioner, signed by the president or
vice president and attested by the corporate secretary or cashier
and acknowledged before some officer authorized by law to
acknowledge deeds. The application shall set forth:
(a) the name and address of the applicant;
(b) a statement of the proposed management including
experience in administering trusts;
(c) the duration of the proposed corporate fiduciary which
may be perpetual;
(d) the amount of capital, surplus and reserve for
operating expenses of the corporate fiduciary or which will be
committed to the trust department if the applicant is a bank,
savings and loan association or savings bank;
(e) a description of the capital structure of the corporate
fiduciary including the number of shares of stock, the classes of
such stock, the par value if any, and the amount for which each
share is to be sold;
(f) a list of the powers, fiduciary appointments and fiduciary
functions the corporate fiduciary wishes to exercise; and
(g) such other relevant information as the Commissioner may
require to support the findings the Commissioner is required to
make to issue a certificate of authority under this Act.
(Source: P.A. 86-754.)
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(205 ILCS 620/2-6) (from Ch. 17, par. 1552-6)
Sec. 2-6.
Upon the filing of an application for a certificate of authority,
the Commissioner shall cause to be made an investigation of the truth of the
statements therein and the background of the management and controlling
shareholder or shareholders and shall not approve the application and issue a
certificate of authority unless he shall be of the opinion and finds:
(a) that the proposed capital at least meets the minimum amounts as
determined pursuant to this Act including amounts deemed necessary to support
the scope of the proposed operations;
(b) that the general character and experience of the proposed management is
such as to assure reasonable promise of successful, safe and sound operation;
and
(c) that the prior business affairs of the persons who will control the
corporate fiduciary or the proposed management personnel, whether as a
stockholder, director, officer, or customer, were conducted in a safe, sound
manner, and lawful manner.
(Source: P.A. 88-408.)
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(205 ILCS 620/2-6.5)
Sec. 2-6.5.
Directors.
(a) The business and affairs of a corporate fiduciary
shall
be managed by its board of directors, which shall exercise its powers
in accordance with this Section.
(b) The directors shall be elected as provided in this Act. Any
omission to
elect a director or directors shall not impair any of the rights and
privileges
of the corporate fiduciary or of any person in any way interested.
The
existing directors shall hold office until their successors are elected
and qualify.
(c) Notwithstanding the provisions of any certificate of authority
heretofore or hereafter issued, the number of directors, not fewer than 5,
may be fixed from time to time by the stockholders at any meeting of the
stockholders called for the purpose of electing directors or changing
the number thereof by the affirmative vote of at least two-thirds of the
outstanding stock entitled to vote at the meeting, and the number so fixed
shall be the board regardless of vacancies until the number of directors
is thereafter changed by similar action.
(d) Except as otherwise provided in this subsection, directors shall
hold
office until the next annual meeting of the stockholders succeeding their
election or until their successors are elected and qualify. If the board of
directors consists of 6 or more members, in lieu of electing the
membership
of the whole board of directors annually, the by-laws of a corporate
fiduciary
may provide that the directors shall be divided into either 2 or 3 classes,
each class to be as nearly equal in number as is possible. The term of
office
of directors of the first class shall expire at the first annual meeting of the
stockholders after their election, that of the second class shall expire at the
second annual meeting after their election, and that of the third class, if
any,
shall expire at the third annual meeting after their election. At each annual
meeting after classification, the number of directors equal to the number of
the class whose terms expire at the time of the meeting shall be elected to
hold office until the second succeeding annual meeting if there are 2
classes
or until the third succeeding annual meeting if there are 3 classes.
Vacancies
may be filled by stockholders at a special meeting called for the purpose.
If authorized by the corporate fiduciary's by-laws or an amendment thereto,
the directors of a corporate fiduciary may properly fill a vacancy or
vacancies
arising between stockholders' meetings, but at no time may the number of
directors selected to fill a vacancy in this manner during any interim period
between stockholders' meetings exceed one-third of the total membership
of the board of directors.
(e) The board of directors shall hold regular meetings at least once
each month, provided that, upon prior written approval by the
Commissioner,
the board of directors may hold regular meetings less frequently than once
each month but at least once each calendar quarter. A special meeting of the
board of directors may be held as provided by the by-laws. A special
meeting of the board of directors may also be held as provided in Section 5-5
of this Act. A majority of the board of directors shall constitute a quorum
for the transaction of business unless a greater number is required by the
by-laws. The act of the majority of the directors present at a meeting
at
which a quorum is present shall be the act of the board of directors unless
the act of a greater number is required by the by-laws.
(f) A member of the board of directors shall be elected president. The
board of directors may appoint other officers, as the by-laws may provide,
and fix their salaries to carry on the business of the corporate fiduciary.
The board of directors may make and amend by-laws (not inconsistent with
this Act) for the government of the corporate fiduciary and may, by the
affirmative vote of a majority of the board of directors, establish
reasonable compensation of all directors for services to the
corporation
as directors, officers, or otherwise. An officer, whether elected or
appointed
by the board of directors or appointed pursuant to the by-laws, may be
removed by the board of directors at any time.
(g) The board of directors shall cause suitable books and records of
all the corporate fiduciary's transactions to be kept.
(h) The provisions of this Section do not apply to a corporate fiduciary
that is a trust department of a bank, savings bank, savings and loan
association, or foreign banking corporation issued a certificate of authority
pursuant to the Foreign Banking Office Act.
(Source: P.A. 92-485, eff. 8-23-01.)
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(205 ILCS 620/2-7) (from Ch. 17, par. 1552-7)
Sec. 2-7.
A corporate fiduciary so incorporated or
authorized after January 1, 1988, shall have minimum capital as determined by the Commissioner as
necessary for safe and sound operation of a corporate
fiduciary. The Commissioner shall record such organization
capital requirements in the Office of the
Secretary of State.
During the time that a corporate fiduciary shall continue in its
fiduciary business, it shall not withdraw, or permit to be withdrawn,
either in the form of dividends or otherwise, any portion of its capital
except as approved by the Commissioner. The Commissioner may, after a
corporate fiduciary has been incorporated or authorized require additional
capital if the Commissioner finds the condition and operations of the
corporate fiduciary or its proposed scope of operations require such
additional capital to achieve or maintain a safe and sound condition.
(Source: P.A. 90-301, eff. 8-1-97.)
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(205 ILCS 620/2-8) (from Ch. 17, par. 1552-8)
Sec. 2-8.
Collateralizing fiduciary assets.
(a) A corporate fiduciary shall not be required and shall not have the power
to collateralize or secure fiduciary funds except as provided in this Section.
(b) All funds, both principal and income, deposited with or held in a
fiduciary capacity by any corporate fiduciary awaiting investment or
distribution, and not otherwise subject to direction regarding investment or
non-investment, shall to the extent reasonable under existing circumstances, be
prudently invested for the beneficiaries at a rate of return commensurate with
that available on trust quality investments.
(c) Funds, both principal and income awaiting investment or distribution,
may be deposited in deposit accounts or other investment vehicles of the
corporate fiduciary, or of any affiliate of the corporate fiduciary; and funds,
both principal and income awaiting investment or distribution which need not be
invested hereunder for the beneficiaries may be commingled with the corporate
fiduciary's own funds and used by the corporate fiduciary in the conduct of its
business, provided that in either case the following apply:
(1) The corporate fiduciary or, in the case of the | ||
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(2) The market value of the collateral may not be | ||
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(3) No collateral shall be required or authorized if | ||
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(4) No collateral shall be required or authorized | ||
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(d) Funds shall not be held commingled and uninvested or undistributed for
an account any longer than is reasonable under existing circumstances for the
proper management of the account.
(e) The collateralization required in this Section is not required or
authorized if the corporate fiduciary or affiliate has in force a surety bond
meeting the requirements of this Section if it is in a form approved by the
Commissioner and if it indemnifies the owners, settlors, or beneficiaries of
funds held in a fiduciary capacity against loss due to the failure of the
corporate fiduciary or affiliate and is issued by a licensed insurance company
authorized to transact business in the State that has been approved by the
Commissioner for the purpose of issuing surety bonds under this Section. A
corporate fiduciary or affiliate may also satisfy the requirements of this
Section by a combination of a surety bond and collateralization as provided in
this Section.
(f) In the event of the failure of the corporate fiduciary or affiliate in
which the corporate fiduciary has made a deposit or commingled funds, the
owners
of the fiduciary funds shall have a first lien, to the extent of their
interest in such funds, on the cash and securities used as collateral hereunder
or the surety bond in addition to their claim against the estate of the
corporate fiduciary.
(Source: P.A. 88-636, eff. 9-9-94; P.A. 88-662, eff. 9-16-94; 89-364, eff.
8-18-95.)
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(205 ILCS 620/2-9) (from Ch. 17, par. 1552-9)
Sec. 2-9.
(Repealed).
(Source: P.A. 85-858. Repealed by 89-364, eff. 8-18-95.)
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(205 ILCS 620/2-10) (from Ch. 17, par. 1552-10)
Sec. 2-10.
Every company may receive, by gift, legacy or
otherwise, moneys or real or personal property, or the income or avails of
such moneys or property, in trust, in perpetuity, for the improvement,
maintenance, ornamentation, repair, care and preservation of any burial lot
or grave, vault, tomb, or other such structures, in any cemetery, upon such
terms and in such manner as may be provided by the terms of the gift,
legacy or other conveyance of the moneys or property
in trust and
assented to by the company. Any such trust in perpetuity created, and held
by any such company, before July 1, 1943, shall, notwithstanding the
absence of statutory authority therefor, be valid unless within 3 years
after July 1, 1943, the trust is terminated by a court of competent
jurisdiction.
(Source: P.A. 85-858.)
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(205 ILCS 620/2-11)
Sec. 2-11.
Retention of agents and advisors.
A corporate fiduciary may
hire and compensate, as an additional expense of the trust or estate,
agents, advisors (including financial, investment, and other advisors), and
brokers (including brokers for the sale or purchase of securities or other
property) to assist or advise the corporate fiduciary in the performance of
its duties, including persons and entities associated or affiliated with the
corporate fiduciary.
(Source: P.A. 89-205, eff. 1-1-96; 89-364, eff. 8-18-95; 90-298, eff. 8-1-97.)
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(205 ILCS 620/2-12)
Sec. 2-12.
Reproductions of documents.
Notwithstanding any other provision
of law, if a corporate fiduciary possesses,
records, or creates any document, memorandum, writing, entry, representation,
or combination thereof, of any act, transaction, occurrence, event, or
agreement (including, without limitation, a trust agreement or amendment
thereto, but excluding in all events an original will or codicil thereto) and
in the regular course of business has caused any or all of the same to be
recorded, copied, or reproduced by photographic, photostatic, facsimile,
microfiche, optical, or electronic imaging, or any other electronic or
computer-generated process that accurately reproduces or forms a medium for so
reproducing the original, the original may be destroyed in the regular course
of business and such recording, copy, or reproduction shall be admissible in
evidence in the same manner as the original in any proceeding, whether the
original is in existence or not. This Section shall not be construed to
exclude from evidence any document or copy thereof that is otherwise admissible
under the rules of evidence.
(Source: P.A. 90-298, eff. 8-1-97; 90-655, eff. 7-30-98.)
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(205 ILCS 620/2-13)
Sec. 2-13.
Employment of persons with convictions.
Except
with the prior written consent of the Commissioner, no person having a
certificate of authority under this Act shall knowingly employ or otherwise
permit an individual to serve as an officer, director, employee, or agent if
the individual has been convicted of a felony or of any criminal offense
relating to dishonesty or breach of trust.
(Source: P.A. 90-301, eff. 8-1-97; 90-655, eff. 7-30-98.)
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(205 ILCS 620/Art. III heading) ARTICLE III.
MERGERS, CHANGE OF CONTROL, SUCCESSOR TRUSTEE
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(205 ILCS 620/3-1) (from Ch. 17, par. 1553-1)
Sec. 3-1.
Merger.
The merger procedure required of a trust company
where there is to
be a resulting trust company by consolidation or merger shall be:
(1) The board of directors of each party to the merger shall, by a
majority of the entire board, approve a merger agreement which shall contain:
(a) The name of each party to the merger and its | ||
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(b) With respect to the resulting trust company (i) | ||
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(c) Provisions stating the method, terms and | ||
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(d) A statement that the agreement is subject to | ||
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(e) Provisions governing the manner of disposing of | ||
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(f) Such other provisions as the Commissioner may | ||
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(2) After approval by the board of directors of each party to the merger, the
merger agreement shall be submitted to the Commissioner for approval, together
with certified copies of the authorizing resolutions of each board of directors
showing approval by a majority of the entire board of each party to the
merger.
(3) After receipt by the Commissioner of the papers specified in paragraph
(2), he shall approve or disapprove the merger agreement. The Commissioner
shall not approve the merger agreement unless he shall be of the opinion and
shall find:
(a) That the resulting trust company meets the | ||
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(b) That the same matters exist in respect of the | ||
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If the Commissioner disapproves an agreement, he shall state his objection
and give an opportunity to the parties to the merger to amend the merger
agreement to obviate such objections.
(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/3-2) (from Ch. 17, par. 1553-2)
Sec. 3-2.
Change in control.
(a) Before a change may occur in the ownership of outstanding
stock or membership interests of any trust company whether by sale and
purchase, gift, bequest or
inheritance, or any other means, which will result in control or a change in
the
control of the trust company or before a change in the control of a holding
company having control of the outstanding stock or membership interests of
a
trust company whether by
sale and purchase, gift, bequest or inheritance, or any other means, which
will
result in control or a change in control of the trust company or holding
company,
the Commissioner shall be of the opinion and find:
(1) that the general character of its proposed | ||
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(2) that the future earnings prospects, after the | ||
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(3) that the prior business affairs of the persons | ||
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(b) Persons desiring to purchase control of an existing trust company and
persons obtaining control by gift, bequest or inheritance, or any other means
shall
submit to the Commissioner:
(1) a statement of financial worth; and
(2) satisfactory evidence that the prior business | ||
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(c) Whenever a bank makes a loan or loans, secured, or to be secured, by 25%
or more of the outstanding stock of a trust company, the president or other
chief executive officer of the lending bank shall promptly report such fact to
the Commissioner upon obtaining knowledge of such loan or loans, except that no
report need be made in those cases where the borrower has been the owner of
record of the stock for a period of one year or more, or the stock is that of a
newly-organized trust company prior to its opening.
(d) (1) Before a purchase of substantially all the assets and an
assumption of substantially all the liabilities of a trust company or before a
purchase of substantially all the trust assets and an assumption of
substantially all the trust liabilities of a trust company, the Commissioner
shall be of the opinion and find:
(i) that the general character of the acquirer's | ||
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(ii) that the acquirer's future earnings prospects, | ||
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(iii) that any prior involvement by the acquirer or | ||
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(iv) that customers' interests will not be | ||
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(v) that adequate provision has been made for all | ||
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(2) Persons desiring to purchase substantially all the assets and assume
substantially all the liabilities of a trust company or to purchase
substantially all the trust assets and assume substantially all the trust
liabilities of a trust company shall submit to the Commissioner:
(i) a statement of financial worth; and
(ii) satisfactory evidence that the prior business | ||
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(e) The reports required by subsections (a), (b),
(c), and (d) of this Section 3-2
shall contain the following information to the extent that it is known by the
person making the report: (1) the number of shares involved; (2) the names of
the sellers (or transferors); (3) the names of the purchasers (or transferees);
(4) the names of the beneficial owners if the shares are registered in another
name; (5) the purchase price; (6) the total number of shares owned by the
sellers (or transferors), the purchasers (or transferees) and the beneficial
owners both immediately before and after the transaction; and, (7) in the case
of a loan, the name of the borrower, the amount of the loan, and the name of
the trust company issuing the stock securing the loan and the number of shares
securing the loan. In addition to the foregoing, such reports shall contain
such other information as may be available and which is requested by the
Commissioner to inform the Commissioner of the effect of the transaction upon
the trust company or trust companies whose stock or assets
and
liabilities are involved.
(f) Whenever such a change as described in subsection (a) of
this Section
3-2 occurs, each trust company shall report promptly to the Commissioner any
changes or replacement of its chief executive officer or of any director
occurring in the next 12 month period, including in its report a statement of
the past and current business and professional affiliations of the new chief
executive officer or directors.
(g) The provisions of this Section do not apply when the change in
control is the result of organizational restructuring under a holding
company.
(h) As used in this Section, the term
"control" means the power, directly or indirectly, to direct the management
or policies of the trust company or to vote 25% or more of the outstanding
stock of the trust company. If there is any question as to whether a change in
control application should be filed, the question
shall be resolved in favor of
filing the application with the Commissioner.
As used in this Section, "substantially all" the assets or
liabilities or the trust assets or trust liabilities of a trust company
means that portion such that their transfer will materially impair the
ability of the trust company to continue successful, safe, and sound
operations or to continue as a going concern.
(Source: P.A. 92-483, eff. 8-23-01; 92-811, eff. 8-21-02.)
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(205 ILCS 620/3-3) (from Ch. 17, par. 1553-3)
Sec. 3-3.
Successor trustee.
(a) If any corporate fiduciary merges into, or
becomes consolidated with, another corporate fiduciary qualified
to administer trusts or is succeeded in its trust business by any
corporate fiduciary by purchase or otherwise; or if a bank
holding company causes a subsidiary, qualified to administer
trusts, to succeed to part or all of the trust business of any
other subsidiary of the same bank holding company, the surviving,
consolidated, successor corporate fiduciary or subsidiary shall
become successor fiduciary in place of such predecessor corporate
fiduciary, unless expressly prohibited by the provisions of the trust
instrument, with all the rights, powers and duties which were
granted to or imposed on such predecessor corporate fiduciary.
(b) (Blank).
(c) Notwithstanding any other provision of law, a corporate fiduciary may
delegate to any of its affiliates qualified to administer trusts any or
all fiduciary duties, actions or decisions, discretionary or otherwise, and the
delegating corporate fiduciary shall not be required to review any delegated
actions or decisions taken by the affiliate. The term "affiliate" means any
state bank, any state savings bank, any state savings and loan association,
any national bank, any trust company, or any other corporation,
which is qualified to act as a fiduciary in this or any other
state and which is a member of the same affiliated group (within
the meaning of Section 1504 of the Internal Revenue Code of 1986, as amended).
(Source: P.A. 90-14, eff. 7-1-97; 91-97, eff. 7-9-99.)
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(205 ILCS 620/Art. IV heading) ARTICLE IV.
FOREIGN CORPORATE FIDUCIARIES
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(205 ILCS 620/4-1) (from Ch. 17, par. 1554-1)
Sec. 4-1.
Foreign corporate fiduciary; certificate of authority.
After
July 13, 1953, no foreign corporation,
including banks, savings banks, and savings and loan associations, now or
hereafter organized under the laws of any other state or
territory, and no national banking association having its
principal place of business in any other state or territory or
federal savings and loan association or federal savings bank
having its principal place of business in any other state or
territory, may procure a certificate of authority under Article
II of this Act and any certificate of authority heretofore issued
hereunder to any such foreign corporation or to any such national
banking association shall become null and void on July 13, 1953,
except that any such foreign corporation or any such national
banking association actually acting as trustee, executor,
administrator, administrator to collect, guardian, or in any
other like fiduciary capacity in this State on July 13, 1953, may
continue to act as such fiduciary in that particular trust or
estate until such time as it has completed its duties
thereunder. Such foreign corporation and such national banking
association shall be subject to the provisions in this Article IV,
regardless of whether its certificate of authority was obtained before July
13, 1953. The right and eligibility of any foreign
corporation, any national banking association having its
principal place of business in any other state or territory or
any federal savings and loan association or federal savings bank
having its principal place of business in any other state or
territory hereafter to act as trustee, executor, administrator,
administrator to collect, guardian, or in any other like
fiduciary capacity in this State shall be governed solely by the
provisions of this Act. Provided, however,
that the Commissioner shall not be required to conduct an annual examination of
such foreign corporation pursuant to Section 5-2 of this Act, but may examine
such foreign corporation as the Commissioner deems appropriate. "Principal
place of business" of any bank, federal savings and loan
association or savings bank, for purposes of this Article IV, means the
principal office as designated on the charter by its principal regulator.
(Source: P.A. 91-97, eff. 7-9-99.)
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(205 ILCS 620/4-2) (from Ch. 17, par. 1554-2)
Sec. 4-2.
Foreign corporation; eligibility.
Any foreign corporation may
act in this State
as trustee, executor, administrator, administrator to collect,
guardian, or in any other like fiduciary capacity, whether the
appointment is by will, deed, court order or otherwise, without
complying with any laws of this State relating to the
qualification of corporations organized under the laws of this
State to conduct a trust business or laws relating to the
qualification of foreign corporations, provided only (1) such
foreign corporation is authorized by the laws of the state of its
organization or domicile to act as a fiduciary in that state, and
(2) a corporation organized under the laws of this State, a
national banking association having its principal place of
business in this State, and a federal savings and loan
association or federal savings bank having its principal place of
business in this State and authorized to act as a fiduciary in
this State, may, in such other state, act in a similar fiduciary capacity or
capacities, as the case may be, upon conditions and
qualifications which the Commissioner finds are not unduly
restrictive when compared to those imposed by the laws of
Illinois. Any foreign corporation eligible to act in a fiduciary
capacity in this State pursuant to the provisions of this Act,
shall be deemed qualified to accept and execute trusts in this
State within the meaning of this Act and the Probate Act of 1975, approved
August 7, 1975, as amended. No foreign corporation shall be
permitted to act as trustee, executor, administrator,
administrator to collect, guardian or in any other like fiduciary
capacity in this State except as provided in Article IV of this
Act; however, any foreign corporation actually acting in any such
fiduciary capacity in this State on July 13, 1953, although not
eligible to so act pursuant to the provisions of this Article IV,
may continue to act as fiduciary in that particular trust or
estate until such time as it has completed its duties thereunder.
(Source: P.A. 92-685, eff. 7-16-02.)
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(205 ILCS 620/4-3) (from Ch. 17, par. 1554-3)
Sec. 4-3.
Service of process upon Secretary of State.
Any foreign corporation acting in this State in a fiduciary
capacity pursuant to the provisions of Article IV and Article IVA of this
Act
shall be deemed to have appointed the Secretary of State to be
its true and lawful attorney upon whom may be served all legal
process in any action or proceeding against it relating to or
growing out of any trust, estate or matter in respect of which
such foreign corporation has acted or is acting in this state in
any such fiduciary capacity, and the acceptance of or engagement
in this State in any acts in any such fiduciary capacity shall be
signification of its agreement that any such process against it
which is so served, shall be of the same legal force and validity
as though served upon it personally. Service of such process
shall be made by delivering to the Secretary of State, the
corporation department of the office a copy of such process,
together with the fee for service of process required by the
Secretary of State, and such service shall be sufficient service
upon said foreign corporation if notice of such service and a
copy of the process are, within 10 days thereafter, sent by
registered mail by the plaintiff to the defendant at its
principal office in such other state or territory and the
plaintiff's affidavit of compliance herewith is appended to the
summons. The court in which the action is pending may order such
continuances as may be necessary to afford the defendant
reasonable opportunity to defend the action. The fee paid by the
plaintiff to the Secretary of State at the time of the service
may be recovered as taxable costs by the plaintiff if such party
prevails in the action. The Secretary of State shall keep a
record of all process served upon him under this section and
shall record therein the time of such service.
(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/4-4) (from Ch. 17, par. 1554-4)
Sec. 4-4.
Place of business not to be established in
State; not deemed transacting business.
(a) A foreign corporation,
as defined in Section 1-5.08 of this Act, shall not establish in
this State a place of business, branch office, or agency for the
conduct of business as a fiduciary and because it is not permitted to
establish in this State a place of business, branch office or
agency, a foreign corporation
insofar as it acts in a fiduciary capacity in this State pursuant
to the provisions of this Act shall not be deemed to be
transacting business in this State.
The foreign corporation may apply for, and
procure from the Commissioner, a license to establish a representative office
pursuant to the Foreign Bank Representative Office Act.
The provisions of this subsection (a) do not apply to foreign
corporations establishing or acquiring and maintaining a place of business in
this State to conduct business as a fiduciary in accordance with Article IVA of
this Act.
(b) Notwithstanding subsection (a) of this Section 4-4, after May 31,
1997, a branch of an out-of-state bank, as defined in Section 2 of the Illinois
Banking Act, and a foreign association, as defined in
Section 1-10.31 of the Illinois Savings and Loan Act of 1985, may establish
an office
in this State for the conduct of business
as a fiduciary, provided: (i) fiduciary
business conducted in this State by a branch of an out-of-state bank is subject
to examination by the Commissioner; and (ii) the trust activities
of the
branch of the out-of-state bank are subject to regulation, including
enforcement actions, by the Commissioner to the same extent as Illinois
corporate fiduciaries.
(Source: P.A. 91-97, eff. 7-9-99; 92-483, eff. 8-23-01.)
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(205 ILCS 620/4-5) (from Ch. 17, par. 1554-5)
Sec. 4-5.
Certificate of authority; fees; certificate of
reciprocity.
(a) Prior to the time any foreign corporation acts in this State as
testamentary trustee, trustee appointed by any court, trustee under any written
agreement, declaration or instrument of trust, executor, administrator,
administrator to collect, guardian or in any other like fiduciary capacity,
such foreign corporation shall apply to the Commissioner of Banks and Real
Estate for a certificate of authority with reference to
the fiduciary capacity or capacities in which such foreign corporation proposes
to act in this State, and the Commissioner of Banks and Real Estate shall issue a certificate of authority to such corporation
concerning only the fiduciary capacity or such of the fiduciary capacities to
which the application pertains and with respect to which he has been furnished
satisfactory evidence that such foreign corporation meets the requirements of
Section 4-2 of this Act. The certificate of authority shall set forth the
fiduciary capacity or capacities, as the case may be, for which the certificate
is issued, and shall recite and certify that such foreign corporation is
eligible to act in this State in such fiduciary capacity or capacities, as the
case may be, pursuant to the provisions of this Act. The certificate of
authority shall remain in full force and effect until such time as such foreign
corporation ceases to be eligible so to act under the provisions of this Act.
(b) Each foreign corporation making application for a certificate of
authority shall pay reasonable fees to the Commissioner of Banks and Real
Estate as determined by the Commissioner for the services
of his office.
(c) Any foreign corporation holding a certificate of
reciprocity which recites and certifies that such foreign
corporation is eligible to act in this State in any such
fiduciary capacity pursuant to the provisions of Article IV of
this Act or any predecessor Act upon the same subject, issued
prior to the effective date of this amendatory Act of 1987 may
act in this State under such certificate of reciprocity in any
such fiduciary capacity without applying for a new certificate of
authority. Such certificate of reciprocity shall remain in full
force and effect until such time as such foreign corporation
ceases to be eligible so to act under the provisions of Article
IV of this Act.
(d) Any foreign corporation acting in Illinois under a certificate of
authority or a certificate of reciprocity shall report changes in its name
or address to the Commissioner and shall notify the Commissioner when it is
no longer serving as a corporate fiduciary in Illinois.
(e) The provisions of this Section shall not apply to a foreign
corporation establishing or acquiring and maintaining a place of business in
this State to conduct business as a fiduciary in accordance with Article IVA
of this Act.
(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/Art. IVA heading) ARTICLE IVA.
MULTISTATE TRUST ACTIVITIES
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(205 ILCS 620/4A-1)
Sec. 4A-1.
Corporate fiduciaries establishing offices in other states.
(a) A corporate fiduciary may act as a fiduciary or otherwise engage in
fiduciary activities in this or any other state or foreign country, subject
to complying with applicable laws of that state or foreign country, at an
office established and maintained pursuant to this Act, at a branch, or at
any location other than an office or branch. A corporate fiduciary seeking
to establish or acquire a branch in another state or foreign country must
comply with the notice provisions in Section 1-7 of this Act.
(b) A corporate fiduciary may also conduct any activities at any office
outside Illinois that are permissible for a trust institution chartered by
the state where the office is located, except to the extent those
activities
are expressly prohibited by the laws of Illinois or by any regulation or order
of the Commissioner. However, the Commissioner may waive any such
prohibition if he determines, by order or regulation, that the involvement
of out-of-state offices of state corporate fiduciaries in particular activities
would not threaten the safety or soundness of those state corporate
fiduciaries.
(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/4A-5)
Sec. 4A-5. Foreign corporations establishing places of business to conduct
fiduciary activities in Illinois. (a) A foreign corporation may establish or acquire and maintain a place of
business for the conduct of business as a fiduciary in this State provided
that a corporate fiduciary that has its principal place of business in
Illinois
is permitted to establish or acquire and maintain a similar place of business
that may engage in activities substantially similar to those permitted to
foreign
corporations under this Act in the state where the foreign corporation has its
principal place of business.
(b) A foreign corporation desiring to establish or acquire and maintain a
place
of
business to conduct business as a fiduciary in Illinois under this Section
shall
provide, or cause its home state regulator to provide, written notice of the
proposed transaction to the Commissioner on or after the date on which the
foreign corporation applies to its home state regulator for approval to
establish
or acquire and maintain a place of business in Illinois. The filing of the
notice
shall be preceded or accompanied by a copy of the resolution adopted by the
board authorizing the additional place of business and the filing fee required
by
the Commissioner. The Commissioner may prescribe the form of the notice
required
under this Section. In the Commissioner's discretion, the application or
notice
submitted to the foreign corporation's home state regulator may be sufficient
notice under this Section.
(c) A foreign corporation desiring to establish or acquire and maintain a
place
of business to conduct business as a fiduciary shall (i) confirm in writing to
the
Commissioner that for as long as it maintains a place of business in
Illinois,
it will comply with the laws of this State and (ii) provide satisfactory
evidence to
the Commissioner of compliance with any applicable requirements of state
foreign
corporation qualification laws and applicable requirements of its home state
regulator for acquiring or establishing and maintaining the office.
(d) A foreign corporation submitting a notice to the Commissioner in
accordance
with subsection (b) may commence fiduciary business at the place of business
listed in its notice after the Commissioner approves the foreign corporation to conduct a fiduciary business in Illinois.
However, if
the foreign corporation is not a depository institution and the Commissioner
approves the foreign corporation to conduct a fiduciary business in Illinois
subject to specific conditions, the foreign corporation shall not commence a
fiduciary business in Illinois until it has satisfied those conditions
and
provided evidence satisfactory to the Commissioner that it has done so. The Commissioner may deny
approval of the notice if he finds that the foreign corporation lacks
sufficient
financial resources to undertake the proposed expansion without adversely
affecting its safety or soundness or that the place of business is contrary to
the public interest.
(Source: P.A. 97-492, eff. 1-1-12.)
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(205 ILCS 620/4A-10)
Sec. 4A-10.
Additional places of business for foreign
corporations. A foreign corporation that establishes or acquires and maintains
a place of business to conduct business as a fiduciary in Illinois pursuant to
Section 4A-5 may establish or acquire additional trust offices or
representative
offices in this State to the same extent that a corporate fiduciary may
establish
or acquire additional offices in Illinois under Section 1-7 of this Act.
(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/4A-15)
Sec. 4A-15.
Representative offices.
A foreign corporation
not conducting fiduciary activities may establish a
representative office under the Foreign Bank Representative
Office Act. At these offices, the foreign corporation may
market and solicit fiduciary services and provide back
office and administrative support to the foreign corporation's
fiduciary activities, but it may not engage in fiduciary
activities.
(Source: P.A. 92-483, eff. 8-23-01; 92-811, eff. 8-21-02.)
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(205 ILCS 620/4A-20)
Sec. 4A-20.
Examination of foreign corporations.
(a) To the extent consistent with subsection (c) of this Section, the
Commissioner
may make such examinations of any place of business established or maintained
under Section 4A-5 by a foreign corporation as the Commissioner may deem
necessary to determine whether the place of business is being operated in
compliance with the laws of this State and in accordance with safe and sound
banking practices. The provisions of Section 5-2 of this Act shall apply to
the examinations.
(b) The Commissioner may require periodic reports regarding any foreign
corporation that has maintained a place of business in this State under
Section 4A-5. The required reports shall be provided by the foreign
corporation or by the home state regulator. Any reporting requirements
prescribed by the Commissioner under this Section shall be consistent
with Section 5-9 of this Act.
(c) The Commissioner may enter into cooperative, coordinating, and
information-sharing agreements with any other bank supervisory
agencies or any organization affiliated with or representing one or more
bank supervisory agencies with respect to the periodic examination or
other supervision of any office in this State of a foreign corporation or any
office of a corporate fiduciary in a host state. The Commissioner may accept
a report of examination or report of investigation in lieu of the
Commissioner conducting an examination or investigation.
(d) The Commissioner may enter into contracts with any bank supervisory
agency that has concurrent jurisdiction over a corporate fiduciary or
foreign corporation maintaining a place of business under Section 4A-5
of this Act to engage the services of that agency's examiners at a reasonable
rate of compensation or to provide the services of the Commissioner's
examiners to that agency at a reasonable rate of compensation.
(e) The Commissioner may enter joint examinations or joint enforcement
actions with other bank supervisory agencies having concurrent jurisdiction
over any place of business established under Section 4A-5 or any office of a
corporate fiduciary in any host state. The Commissioner may at any time take
such actions independently if the Commissioner deems such actions to be
necessary or appropriate to ensure compliance with the laws of this State.
However, in the case of a foreign corporation, the Commissioner shall recognize
the exclusive authority of the home state regulator over corporate governance
matters and the primary responsibility of the home state regulator over safety
and soundness matters.
(f) A foreign corporation that maintains one or more offices pursuant to
Section 4A-5 may be assessed, and if assessed, shall pay supervisory
and examination fees in accordance with Section 5-10 of this Act. The
fees may be shared with other bank supervisory agencies or any organization
affiliated with or representing one or more bank supervisory agencies in
accordance with agreements between such parties and the Commissioner.
(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/4A-25)
Sec. 4A-25.
Notice to Commissioner.
A corporate fiduciary that
maintains
a place of business in this State under Section 4A-5, or the home state
regulator
of such foreign corporation, shall give at least 30 days prior written notice
or,
in the case of an emergency transaction, such shorter notice as is consistent
with applicable state or federal law, to the Commissioner of:
(1) any merger, consolidation, or other transaction | ||
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(2) any transfer of all or substantially all of the | ||
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(3) the closing or disposition of any place of | ||
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(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/Art. V heading) ARTICLE V.
SUPERVISION OF CORPORATE FIDUCIARIES
AND POWERS OF THE COMMISSIONER
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(205 ILCS 620/5-1) (from Ch. 17, par. 1555-1)
Sec. 5-1. Commissioner's powers. The Commissioner of Banks and Real
Estate shall have the following powers and
authority and is charged with the duties and responsibilities
designated in this Act:
(a) To promulgate, in accordance with the Illinois Administrative Procedure
Act, reasonable rules for the purpose of administering the provisions of this
Act and for the purpose of incorporating by reference rules promulgated by the
Federal Deposit Insurance Corporation, the Board of Governors of the Federal
Reserve System, the Office of the Comptroller of the Currency, the
Office of Thrift Supervision, or their successors that pertain to corporate
fiduciaries, including, but not limited to, standards for the operation and
conduct of the affairs of corporate fiduciaries;
(b) To issue orders for the purpose of administering the
provisions of this Act and any rule promulgated in accordance
with this Act;
(c) To appoint hearing officers to conduct hearings held
pursuant to any of the powers granted to the Commissioner under
this Section for the purpose of administering this Act and any
rule promulgated in accordance with this Act;
(d) To subpoena witnesses, to compel their attendance, to
administer an oath, to examine any person under oath and to
require the production of any relevant books, papers, accounts
and documents in the course of and pursuant to any investigation
being conducted, or any action being taken, by the Commissioner
in respect of any matter relating to the duties imposed upon, or
the powers vested in, the Commissioner under the provisions of
this Act, or any rule or regulation promulgated in accordance
with this Act;
(e) To conduct hearings;
(f) To promulgate the form and content of any applications required
under this Act;
(g) To impose civil penalties of up to $100,000 against any
person or corporate fiduciary for each violation of any provision
of this Act, any rule promulgated in accordance with this Act,
any order of the Commissioner or any other action which, in the
Commissioner's discretion, is a detriment or impediment to
accepting or executing trusts; and
(h) To address any inquiries to any corporate fiduciary, or
the officers thereof, in relation to its doings and conditions,
or any other matter connected with its affairs, and it shall be
the duty of any corporate fiduciary or person so addressed, to
promptly reply in writing to such inquiries. The Commissioner
may also require reports from any corporate fiduciary at any time
he may deem desirable.
(Source: P.A. 96-1365, eff. 7-28-10.)
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(205 ILCS 620/5-2) (from Ch. 17, par. 1555-2)
Sec. 5-2.
Examinations of corporate fiduciaries.
(a) The Commissioner, no less frequently than 18 months following the
preceding examination,
and whenever in his judgment it is necessary or expedient,
either personally or by one or more
competent persons appointed by him, shall visit and examine every
corporate fiduciary in this State
and may, to the extent the Commissioner determines necessary, examine the
affairs of the corporate fiduciary's subsidiaries, affiliates, parent
companies and contractual service providers for fiduciary services of the
corporate fiduciary as shall be necessary to fully disclose the condition
of such subsidiaries, affiliates, parent companies and contractual service
providers and the relation between the corporate fiduciary and such
subsidiaries, affiliates, parent companies and contractual service
providers and the effect of such relations upon the affairs of such
corporate fiduciary. Instead of the Commissioner making the examination
provided by this
subsection or appointing a competent person to do so, the Commissioner may
accept on an alternating basis the examination made by the corporate
fiduciary's appropriate federal regulatory agency, provided the appropriate
federal regulatory agency has made such an examination. Fiduciary services
shall include, but not be limited
to, clerical, accounting, bookkeeping, statistical, data processing,
safekeeping or similar functions for a corporate fiduciary.
(b) The Commissioner and every such examiner may administer
an oath to any person whose testimony is required on any such
examination, and compel the appearance and attendance of any such
person for the purpose of examination, by summons, subpoena or
attachment, in the manner now authorized in respect to the
attendance of persons as witnesses in the circuit court; and all
books and papers which are necessary to be examined by the
Commissioner or examiner so appointed shall be produced, and
their production may be compelled in like manner.
(c) The expense of every examination, if any, shall be paid
by the corporate fiduciary examined, in such amount as the
Commissioner certifies to be just and reasonable.
(d) On every examination, inquiry shall be made as to the
condition and resources of the corporate fiduciary generally, the
mode of conducting and managing its affairs, the action of its
directors or trustees, the investments of its funds, the safety
and prudence of its management, the security afforded to those by
whom its engagements are held, and whether the requirements of
its charter and of the laws have been complied with in the
administration of its affairs. The nature and condition of the assets in or
investment of any bonus, pension, or profit sharing plan for officers or
employees of a corporate fiduciary shall be deemed to be included in the
affairs of that corporate fiduciary subject to examination by the
Commissioner.
(e) Whenever any corporate fiduciary causes to be performed, by
contract or otherwise, any fiduciary services for itself, whether on or off its
premises:
(1) such performance shall be subject to examination | ||
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(2) the corporate fiduciary shall notify the | ||
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For purposes of this subsection (e), the term "fiduciary services" shall
include such services as the computation and posting of interest and other
credits and charges; preparation and mailing of checks, statements, notices and
similar items; clerical, bookkeeping, accounting, statistical or similar
functions; and any other function which the corporate fiduciary, in the
ordinary course of its business, could have performed itself.
Any report of examination pursuant to this Section and any
copies thereof shall be the property of the Commissioner,
confidential and may only be disclosed under the circumstances
set forth in Section 48.3 of the Illinois Banking Act, as
now or hereafter amended.
(Source: P.A. 92-811, eff. 8-21-02.)
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(205 ILCS 620/5-3) (from Ch. 17, par. 1555-3)
Sec. 5-3.
Violations; orders.
(a) Whenever it appears to the Commissioner
from any examination, statement of condition or report, that any
corporate fiduciary has committed any violation of law, has made
or published a false statement of condition or is conducting its
business in an unsafe, unsound or unauthorized manner, he shall,
by an order under his signature, direct the discontinuance of
such illegal and unsafe, unsound or unauthorized practices and
that the corporate fiduciary strictly conform with the
requirements of the law, and with safety and security in its
transactions.
(b) If a corporate fiduciary refuses or neglects to make a
required statement of condition or any report required under this
Act, or to comply with an order as above stated, or if it appears
to the Commissioner that it is unsafe or inexpedient for the
corporate fiduciary to continue to transact business, or that
extraordinary withdrawals of money are jeopardizing the interests
of remaining depositors, or that any corporate fiduciary or
officer of a corporate fiduciary has abused his trust or is
guilty of misconduct in his official position, injurious to the
corporate fiduciary, or that it has suffered a serious loss, he
shall enter an order appropriate to the circumstances, which may
include the appointment of a receiver as hereinafter provided,
the taking of possession of the corporate fiduciary, or the removal of
a
director, officer, employee, or agent of the corporate fiduciary, or
he may, represented by the Attorney General, seek an injunction or other
appropriate order from the court.
(c) No dividends shall be paid by a corporate fiduciary while it
continues its business as a corporate fiduciary to an amount greater than
its net profits then on hand, deducting first therefrom its losses
and bad debts.
(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/5-4) (from Ch. 17, par. 1555-4)
Sec. 5-4.
If the Commissioner has satisfactory evidence
that any statement of condition or other report required or
authorized by this Act, made by any officer or officers of a
corporate fiduciary is false, the Commissioner may revoke the
certificate of authority granted on behalf of such corporate
fiduciary and mail a copy of such revocation to that corporate
fiduciary and the clerk of the circuit court in each county in
the state of Illinois. Such revocation shall not be set aside
until satisfactory evidence is given to the Commissioner that
such corporate fiduciary is in substance and in fact in the
condition set forth in such required statement of condition or
report or that a corrected statement of condition, or report as
the case may be, is prepared, filed with the Commissioner and
published if the original statement or report was required to be
published and satisfactory evidence that all the requirements of
this Act have been complied with. Such revocation is cause for
the removal of such corporate fiduciary from any appointment held
by it under this Act.
(Source: P.A. 85-858.)
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(205 ILCS 620/5-5) (from Ch. 17, par. 1555-5)
Sec. 5-5.
A special meeting of the board of directors may
be held upon call by the Commissioner or an examiner appointed
under the provisions of this Act, upon not less than 12 hours
notice of such meeting by personal service of such notice, or by
mailing said notice to each of the directors at his residence as
shown by the books of the corporate fiduciary.
(Source: P.A. 85-858.)
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(205 ILCS 620/5-6) (from Ch. 17, par. 1555-6)
Sec. 5-6. Removal orders. Whenever, in the opinion of the Secretary,
any director, officer, employee, or agent of a corporate fiduciary
or subsidiary or corporate parent of the corporate fiduciary
shall have violated any law, rule, or order relating to the corporate
fiduciary
or subsidiary or corporate parent of the corporate fiduciary, shall have
engaged in an unsafe or unsound practice in conducting
the
business of the corporate fiduciary
or subsidiary or corporate parent of the corporate fiduciary, or shall
have violated any law or
engaged or participated in any unsafe or unsound practice in connection with
any financial institution or other business entity such that the character and
fitness of the director, officer, employee, or agent does not assure reasonable
promise of safe and sound operation of the corporate fiduciary
or subsidiary or corporate parent of the corporate fiduciary, the Secretary
may issue an order of
removal.
If in the opinion of the Secretary, any former director, officer,
employee, or agent of a corporate fiduciary
or subsidiary or corporate parent of the corporate fiduciary, prior to the
termination of his
or her service with the corporate fiduciary
or subsidiary or corporate parent of the corporate fiduciary, violated any
law, rule, or order
relating to the corporate fiduciary
or subsidiary or corporate parent of the corporate fiduciary
or engaged in an unsafe or unsound practice
in conducting the business of the corporate fiduciary
or subsidiary or corporate parent of the corporate fiduciary
or violated any law or
engaged or participated in any unsafe or unsound practice in connection with
any financial institution or other business entity such that the character and
fitness of the director, officer, employee, or agent would not have assured
reasonable promise of safe and sound operation of the corporate fiduciary
or subsidiary or corporate parent of the corporate fiduciary,
the
Secretary may issue
an order prohibiting that person from further service with a corporate
fiduciary
or subsidiary or corporate parent of the corporate fiduciary
as a director, officer, employee, or agent. An order issued pursuant
to this Section shall be served upon the
director, officer, employee, or
agent. A copy of the order shall be sent to each director of the corporate
fiduciary
affected by personal service, certified mail return receipt
requested, or any other method that provides proof of service and receipt. A copy of the order shall
be served upon the corporate fiduciary
of which the person is a
director, officer, employee, or agent, whereupon the person shall cease to be a
director,
officer, employee, or agent of the corporate fiduciary. Any person who has
been removed or prohibited by an order of the Secretary under this
Section or subsection
(7) of Section 48 of the Illinois Banking Act may not thereafter serve as
director, officer, employee, or agent of any State bank or corporate fiduciary,
or of any other entity that is subject to licensure or regulation by the Division of Banking
unless the Secretary
has granted prior approval in writing. The Secretary may institute a civil
action against the
director,
officer, employee, or agent subject to an order issued under this Section and
against the corporate fiduciary
to enforce compliance with or to enjoin any
violation of the terms of the order.
(Source: P.A. 96-1163, eff. 1-1-11.)
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(205 ILCS 620/5-7) (from Ch. 17, par. 1555-7)
Sec. 5-7.
Any person or corporate fiduciary affected by
any action under this Act, other than under
Section 5-6, may request a hearing before the
Commissioner within 10 days after receipt of notice of such action. The
hearing shall be held by the Commissioner within 30 days after
such request has been received by the Commissioner. At the
conclusion of such hearing, the Commissioner shall make a
determination approving, modifying or disapproving the action
taken as the final administrative decision.
(Source: P.A. 86-754.)
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(205 ILCS 620/5-8) (from Ch. 17, par. 1555-8)
Sec. 5-8.
All final administrative decisions of the
Secretary shall be subject to review pursuant
to the provisions of the Administrative Review Law, as now or
hereafter amended, and the rules adopted pursuant thereto.
For matters involving administrative review, venue shall be in either
Sangamon County or Cook County.
(Source: P.A. 96-1163, eff. 1-1-11.)
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(205 ILCS 620/5-9) (from Ch. 17, par. 1555-9)
Sec. 5-9. Statement of condition.
(a) Each corporate fiduciary shall file with
the Commissioner, when requested, a statement under oath, of the
condition of such corporate fiduciary as of the date requested.
The statement of condition shall be in such form and contain such
statements, returns and information, as to the affairs, business
conditions, and resources of the corporate fiduciary or of its
trust department, as the case may be, as the said Commissioner
may, from time to time prescribe or require.
(b) Such statement of condition shall be verified by the
affidavit of the president, vice president or principal
accounting officer of said corporate fiduciary, who shall also
state in such affidavit that he has examined the books and
accounts of said corporate fiduciary or of its trust department,
as the case may be for the purpose of making said report or
statement, and that the information contained in the statement or
report is accurate to the best of his knowledge and belief. If the statement
is submitted in electronic form, the Commissioner may, in the call for the
report, specify the manner in which the appropriate officer of the corporate
fiduciary shall verify the statement of condition.
(c) (Blank).
(d) Any corporate fiduciary which fails to file an accurate
statement of condition on or before the date it is due may be fined $100 for each
day of noncompliance.
(e) Any corporate fiduciary which is the victim of a robbery
or experiences a
shortage of funds in excess of $10,000, an apparent
misapplication of
the corporate fiduciary's funds by an officer, employee, director,
or
agent, a charge-off of assets of the corporate fiduciary, or any adverse legal action in an amount
in excess of 10% of total capital and surplus of the corporate fiduciary,
including but
not limited to, the entry of an adverse money judgment against the
corporate fiduciary shall report that information in writing to the
Commissioner within 7 days. Neither the corporate fiduciary,
its directors, officers, employees or agents, in the preparation or
filing of the reports required by this subsection, shall be
subject to any
liability for libel, slander or other charges resulting from information
supplied in such reports, except when the supplying of such information is
done in a corrupt or malicious manner or otherwise not in good faith.
(Source: P.A. 97-492, eff. 1-1-12.)
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(205 ILCS 620/5-10) (from Ch. 17, par. 1555-10)
Sec. 5-10. Fees; receivership account.
(a) There shall be paid to the Commissioner by every corporate
fiduciary including each trust company, bank, savings and loan association,
and savings bank to which this Act
shall apply, reasonable
fees that the Commissioner shall assess to recover the costs of administration,
certification, examination and supervision of trusts
authorized under this Act.
(b) In addition to the fees authorized in
subsection (a) of this
Section the Commissioner shall assess reasonable receivership fees and
establish a Non-insured Institutions Receivership account in the Bank
and Trust Company Fund to provide for the expenses that arise from the
administration of the receivership of a corporate fiduciary under this Act.
The aggregate of such assessments shall be paid into the Non-insured Institutions Receivership
account in the Bank and Trust Company Fund. The assessments for this
account shall be levied until the sum of $4,000,000 has been
deposited into
the account from assessments authorized herein, whereupon the Non-insured Institutions Receivership
account assessment shall be abated. If a receivership of a corporate
fiduciary under this Act requires expenditures from this account,
assessments may be reinstituted until the balance in the Non-insured Institutions Receivership
account arising from assessments is restored to $4,000,000.
(c) The Commissioner
may, by rule, establish a reasonable manner of assessing the receivership
assessments under this Section.
(Source: P.A. 96-1365, eff. 7-28-10.)
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(205 ILCS 620/5-10.5)
Sec. 5-10.5. Disclosure of records. A corporate fiduciary may not
disclose to any person, except to the customer or the customer's duly
authorized agent, any records pertaining to the fiduciary relationship between
the corporate fiduciary and the customer unless:
(1) the instrument or court order establishing the | ||
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(2) applicable law authorizes the disclosure;
(3) disclosure by the corporate fiduciary is | ||
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(4) Section 48.1 of the Illinois Banking Act would | ||
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For purposes of this Section, "customer" means the person or individual who
contracted to establish the fiduciary relationship or who executed any
instrument or document from which the fiduciary relationship was established, a
person authorized by the customer to provide such direction or, if the
instrument, law, or court order so permits, the beneficiaries of the fiduciary
relationship.
(Source: P.A. 99-642, eff. 7-28-16.)
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(205 ILCS 620/5-11) (from Ch. 17, par. 1555-11)
Sec. 5-11.
A corporate fiduciary shall be reimbursed for costs which
are reasonably necessary and which have been directly incurred in searching
for, reproducing or transporting books, papers, records or other data of a
customer required or requested to be produced pursuant to a lawful
subpoena, summons, warrant or court order. The Commissioner shall
determine the rates and conditions under which payment may be made.
(Source: P.A. 85-1402.)
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(205 ILCS 620/Art. VI heading) ARTICLE VI.
RECEIVER AND INVOLUNTARY LIQUIDATION
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(205 ILCS 620/6-1) (from Ch. 17, par. 1556-1)
Sec. 6-1.
Exclusive remedy.
The proceedings pursuant to
this Article 6 shall be the exclusive remedy and the only
proceedings commenced in any court for the dissolution or for the
winding up of the affairs or for the appointment of a receiver
for any corporate fiduciary.
(Source: P.A. 85-858.)
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(205 ILCS 620/6-2) (from Ch. 17, par. 1556-2)
Sec. 6-2.
Control by Commissioner.
(a) If the Commissioner with respect to a
corporate fiduciary shall find:
(1) Its capital is impaired or it is otherwise in an | ||
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(2) Its business is being conducted in an unlawful | ||
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(3) It is unable to continue operations; or
(4) Its examination has been obstructed or impeded; | ||
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(b) If, in addition to a finding as provided in subsection
(a) of this Section, the Commissioner shall be of the opinion and
shall find that an emergency exists which may result in serious
losses to the beneficiaries of fiduciary relationships with the
corporate fiduciary, he may, in his discretion, without having
given the notice provided for in subsection (a) of this Section,
and whether or not proceedings under subsection (a) of this
Section have been instituted or are then pending, forthwith take
possession and control of the corporate fiduciary and its assets
for the purpose of examination, reorganization or liquidation
through receivership.
(Source: P.A. 92-483, eff. 8-23-01.)
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(205 ILCS 620/6-3) (from Ch. 17, par. 1556-3)
Sec. 6-3.
The Commissioner may take possession and
control of a corporate fiduciary, its assets, and assets held for
the beneficiaries of its fiduciary obligations by posting upon
the premises of each office at which it transacts its business as
a corporate fiduciary a notice reciting that he is assuming
possession pursuant to this Act, and the time when his possession
shall be deemed to commence.
(Source: P.A. 85-858.)
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(205 ILCS 620/6-4) (from Ch. 17, par. 1556-4)
Sec. 6-4.
Judicial proceedings; examination.
(a) Promptly after taking possession and control of a corporate
fiduciary, the Commissioner shall file a copy of the notice posted upon the
premises in the circuit court in the county in which the corporate fiduciary is
located, which cause shall be entered as a court action upon the dockets of
such court under the name and style of "In the matter of the possession and
control of the Commissioner of Banks and Real Estate
of ......" (inserting the name of such corporate fiduciary). If the
Commissioner
determines (which determination may be made at the time of, or at any time
subsequent to, his taking possession and control of a corporate fiduciary) that
no practical possibility exists to reorganize the corporate fiduciary after
reasonable efforts have been made, the Commissioner, represented by the
Attorney General shall also file a complaint, if he has not already done so
under Section 58 of the Illinois Banking Act, as now or hereafter amended, for
the appointment of a receiver or such other proceeding as is appropriate under
the circumstances. The court where the cause is docketed shall be vested with
jurisdiction to hear and determine all issues and matters pertaining to or
connected with the Commissioner's possession and control of such corporate
fiduciary as provided in this Act, and such further issues and matters
pertaining to or connected with the Commissioner's possession and control as
may be submitted to such court for its adjudication by the Commissioner.
(b) The Commissioner, upon taking possession and control of a corporate
fiduciary, may, and, if he has not previously done so, shall, immediately upon
filing a complaint for dissolution, make an examination of the
affairs of the corporate fiduciary or appoint a corporate fiduciary or
other suitable person to make the examination as the Commissioner's agent.
The examination shall be conducted in accordance with and pursuant to the
authority granted under Section 5-2 of this Act, and the corporate
fiduciary or other suitable person conducting the examination shall have
and may exercise on behalf of the Commissioner all of the powers and
authority granted to the Commissioner thereunder. The report of
examination shall, to the extent reasonably possible, identify those
governing instruments with specific instructions concerning the appointment
of a successor fiduciary. A copy of the report shall be filed in any
dissolution proceeding filed by the Commissioner. The reasonable fees and
necessary expenses of the examining corporate fiduciary or other suitable
person, as approved by the Commissioner or as recommended by the
Commissioner and approved by the court if a dissolution proceeding has been
filed, shall be borne by the subject corporate fiduciary and shall have the
same priority for payment as the reasonable and necessary
expenses of the Commissioner in conducting an examination.
As soon as reasonably can be done, the Commissioner, if he deems it
advisable, shall seek the advice and instruction of the court concerning
the removal of the corporate fiduciary as to all of its fiduciary accounts
and the appointment of a successor fiduciary (which may be the examining
corporate fiduciary) to take over and administer all of the fiduciary
accounts being administered by the trust department of the corporate
fiduciary. The corporate fiduciary or other suitable person appointed to make
the examination shall make a proper accounting, in the manner and scope as
determined by the Commissioner to be practical and advisable under the
circumstances, on behalf of the trust department of the corporate fiduciary
and no guardian ad litem need be appointed to review the accounting.
(Source: P.A. 89-508, eff. 7-3-96.)
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(205 ILCS 620/6-5) (from Ch. 17, par. 1556-5)
Sec. 6-5.
When the Commissioner has taken possession and
control of a corporate fiduciary and its assets, he shall be
vested with the full powers of management and control, including
but not limited to, the following:
(1) The power to continue or to discontinue the business;
(2) The power to stop or to limit the payment of its
obligations;
(3) The power to collect and to use its assets and to give
valid receipts and acquittances therefor;
(4) The power to employ and to pay any necessary
assistants;
(5) The power to execute any instrument in the name of the
corporate fiduciary;
(6) The power to commence, defend and conduct in its name
any action or proceeding in which it may be a party;
(7) The power, upon the order of the court, to sell and
convey its assets in whole or in part, and to sell or compound
bad or doubtful debts upon such terms and conditions as may be
fixed in such order;
(8) The power, upon the order of the court, to make and to
carry out agreements with other corporate fiduciaries, financial
institutions or with the United States or any agency thereof, for
the payment or assumption of the corporate fiduciaries
liabilities, in whole or in part, and to transfer assets and to
make guaranties, in whole or in part, and to transfer assets and
to make guaranties in connection therewith;
(9) The power, upon the order of the court, to borrow money
in the name of the corporate fiduciary and to pledge its assets
as security for the loan;
(10) The power to terminate his possession and control by
restoring the corporate fiduciary to its board of directors;
(11) The power to reorganize the corporate fiduciary as
provided in this Act;
(12) The power to appoint a receiver which may be the
Office of the Commissioner, a corporate fiduciary or another suitable
person and to order liquidation of the corporate
fiduciary as provided in this Act; and
(13) The power, upon the order of the court and without the
appointment of a receiver, to determine that the corporate
fiduciary has been closed for the purpose of liquidation without
adequate provision being made for payment of its fiduciary
obligations, and thereupon the corporate fiduciary shall be
deemed to have been closed on account of inability to meet its
obligations to its beneficiaries.
(Source: P.A. 86-754.)
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(205 ILCS 620/6-6) (from Ch. 17, par. 1556-6)
Sec. 6-6.
Upon taking possession, the Commissioner shall
make an examination of the condition of the corporate fiduciary,
an inventory of the assets and unless the time shall be extended
by order of the court or, unless the Commissioner shall have
otherwise settled the affairs of a corporate fiduciary pursuant
to the provisions of this Act, within 30 days from the time
of taking possession and control of the corporate fiduciary for
the purpose of examination, reorganization or liquidation through
receivership, the Commissioner shall either terminate his
possession and control by restoring the corporate fiduciary to
its board of
directors or appoint a receiver which may be the Office of the
Commissioner, a corporate fiduciary or another suitable person and order
the liquidation of the corporate
fiduciary as provided in this Act.
All necessary and reasonable expenses of the Commissioner's
possession and control and of its reorganization shall be a
priority claim and shall be borne by the corporate fiduciary and
may be paid by the Commissioner from its own assets as
distinguished from those of beneficiaries of fiduciary relations.
(Source: P.A. 86-754.)
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(205 ILCS 620/6-7) (from Ch. 17, par. 1556-7)
Sec. 6-7.
If the Commissioner takes possession and
control of a corporate fiduciary and its assets, or appoints
a receiver which may be the Office of the Commissioner, a corporate
fiduciary or another suitable person for the purpose of
so doing, any period of
limitation fixed by a statute or agreement which would otherwise expire
on a claim or right of action of the corporate
fiduciary, on its own
behalf or on behalf of a beneficiary in any of its fiduciary capacities, or
upon
which an appeal must be taken or a pleading or other document
must be filed by the corporate fiduciary in any pending action or
proceeding shall be tolled until 6 months after the commencement
of such possession and no judgment, lien, levy, attachment or
other similar legal process shall be enforced upon or satisfied
in whole or in part from any asset of the corporate
fiduciary or from
any asset of a beneficiary of any of its fiduciary capacities while
it is in the possession of the Commissioner or receiver, except upon
the order of the court.
(Source: P.A. 86-754.)
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(205 ILCS 620/6-7.1) (from Ch. 17, par. 1556-7.1)
Sec. 6-7.1.
If the Commissioner appoints a receiver to take
possession and control of the assets of the beneficiaries of such fiduciary
relations, for the purpose of holding such assets as fiduciary for the
benefit of such beneficiaries pending the winding up of the affairs of the
corporate fiduciary being liquidated and the appointment of a successor
fiduciary or fiduciaries for such beneficiaries, any period of limitation
fixed by statute, rule of court or agreement which would otherwise expire on
a claim or right of action in favor of or against the beneficiary of such
fiduciary relations, or upon which an appeal must be taken or a pleading or
other document which must be filed by a corporate fiduciary on behalf of a
beneficiary in any pending action or proceeding shall be tolled for a
period of 6 months after the appointment of a receiver, and no judgment,
lien, levy, attachment or other similar legal process shall be enforced
upon or satisfied in whole or in part from any asset of the beneficiary of
such fiduciary relations while it is in the possession of such receiver,
except upon the order of the court.
(Source: P.A. 86-754.)
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(205 ILCS 620/6-8) (from Ch. 17, par. 1556-8)
Sec. 6-8.
The Commissioner, while in possession and
control of a corporate fiduciary may propose a reorganization
plan, which plan may be amended from time to time because of
changes in circumstances, if he finds:
(1) The plan is feasible and fair to all classes of
beneficiaries, creditors and stockholders.
(2) The face amount of the interest accorded to any class
of creditors or stockholders under the plan does not exceed the
value of the assets upon liquidation less the full amount of the
claims of all prior classes, subject, however, to any fair
adjustment for new capital that any class will pay in under the
plan.
(3) The plan assures the removal of any director, officer
or employee responsible for any unsound or unlawful action or the
existence of an unsound condition.
(4) Any merger or consolidation provided by the plan
conforms to the requirements of this Act.
(5) Any reorganized corporate fiduciary provided by the plan
conforms to the requirements of this Act for the organization of
a corporate fiduciary.
(Source: P.A. 85-1402.)
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(205 ILCS 620/6-9) (from Ch. 17, par. 1556-9)
Sec. 6-9.
If the Commissioner determines at any time
that no reasonable possibility exists for the corporate fiduciary
to be reorganized after reasonable efforts have been made, and
that it should be liquidated through receivership, he shall
appoint a receiver. The Commissioner may require of the receiver
such bond and security as the Commissioner deems proper. The
Commissioner, represented by the Attorney General, shall file a
complaint for the dissolution or winding up of the affairs of such
corporate fiduciary in a court of the county where the principal office of
such corporate fiduciary is located and shall cause notice to be given
in a newspaper of general circulation once each week for four
consecutive weeks that persons who may have claims against the
corporate fiduciary present them to the receiver and to make
legal proof thereof and notifying all such persons and all to
whom it may concern of the filing of a complaint for the
dissolution or winding up of the affairs of the corporate
fiduciary and stating the name and location of said court. All
persons who may have claims against the assets of such corporate fiduciary, as
distinguished from the assets of the beneficiaries of such fiduciary relations, and
the receiver to whom such persons have presented their claims may
present them to the clerk of such court, and the allowance or
disallowance of such claims by said court in connection with such
proceedings shall be deemed an adjudication in a court of
competent jurisdiction.
(Source: P.A. 86-754.)
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(205 ILCS 620/6-10) (from Ch. 17, par. 1556-10)
Sec. 6-10.
The receiver for a corporate fiduciary, under
the direction of the Commissioner, shall have the power and
authority and is charged with the duties and responsibilities as
follows:
(1) To take possession of, and for the purpose of the | ||
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(2) To proceed to collect all debts, dues and claims | ||
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(3) To file with the Commissioner a copy of each | ||
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(4) The receiver shall have authority to sue and | ||
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(5) The receiver shall have authority, and it shall | ||
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(6) As soon as can reasonably be done, the receiver | ||
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(7) The receiver shall have authority to redeem or | ||
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(8) Whenever the receiver shall find it necessary in | ||
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(9) The receiver shall deposit daily all monies | ||
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(10) The receiver shall do such things and take such | ||
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(11) The receiver shall record any judgment of | ||
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(12) The receiver may cause all assets of the | ||
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(13) The receiver shall have a reasonable period of | ||
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(14) For its services in administering the trusts and | ||
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(15) The receiver, during its administration of the | ||
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(16) Upon the appointment of a successor trustee or | ||
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(Source: P.A. 101-48, eff. 1-1-20; 101-81, eff. 7-12-19.)
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(205 ILCS 620/6-11) (from Ch. 17, par. 1556-11)
Sec. 6-11.
Upon the order of the court wherein the
Commissioner's complaint for the dissolution or winding up of the
affairs of the corporate fiduciary was filed, the receiver for
the corporate fiduciary shall have the power and authority and is
charged with the duties and responsibilities as follows:
(1) The receiver may sell and compound all bad and doubtful
debts on such terms as the court shall direct.
(2) The receiver may sell the real and personal property of
the corporate fiduciary, as distinguished from the real and personal
property of the beneficiaries of such fiduciary relations, on such terms
as the court shall direct.
(3) The receiver may petition the court for the authority to
borrow money, and to pledge the assets of the corporate fiduciary
as security therefor, whereupon the practice and procedure shall
be as follows:
(a) Upon the filing of such petition the court shall
set a date for the hearing of such petition and shall prescribe
the form and manner of the notice to be given to the officers,
stockholders, creditors and other persons interested in such
corporate fiduciary.
(b) Upon such hearing, any officer, stockholder,
creditor or person interested shall have the right to be heard.
(c) If the court grants such authority, then the
receiver may borrow money and issue evidences of indebtedness
therefor, and may secure the payment of such loan by the
mortgage, pledge, transfer in trust or hypothecation of any or
all property and assets of such corporate fiduciary, whether
real, personal, or mixed, superior to any charge thereon for the
expenses of liquidation.
(d) Such loan may be obtained in such amounts upon
such terms and conditions, and with provisions for repayment as
may be deemed necessary or expedient.
(e) Such loan may be obtained for the purpose of
facilitating liquidation, protecting or preserving the assets,
expediting the making of distributions to depositors and other
creditors, providing for the expenses of administration and
liquidation, aiding in the reopening or reorganization of such
corporate fiduciary or its merger or consolidation with another
corporate fiduciary, or in the sale of its assets.
(f) The receiver shall be under no personal obligation
to repay any such loan and shall have authority to take any
action necessary or proper to consummate such loan and to provide
for the repayment thereof, and may, when required, give bond for
the faithful performance of all undertakings in connection
therewith.
(g) Prior to petitioning the court for authority to
make any such loan, the receiver may make application for or
negotiate any loan subject to obtaining an order of the court
approving the same.
(4) The receiver may make and carry out agreements with other
corporate fiduciaries, banks, or with the United States or any
agency thereof for the payment or assumption of the corporate
fiduciary's liabilities, in whole or in part, and the receiver may
transfer assets and make guaranties in connection therewith.
(5) After the expiration of 4 weeks after the first
publication of the Commissioner's notice as provided in Section
6-9, the receiver shall file with the court a correct list of all
creditors of the corporate fiduciary, as shown by its books, who
have not presented their claims and the amount of their
respective claims after allowing all just credits, deductions and
set-offs as shown by the books of the corporate fiduciary. Such
claims so filed shall be deemed proven, unless objections are
filed thereto by a party or parties interested therein within
such time as is fixed by the court.
(6) At the termination of the receiver's
administration, the receiver shall petition the court for the entry of a judgment of
dissolution. After a hearing upon such notice as the court may
prescribe, the court may enter a judgment of dissolution
whereupon the corporate fiduciary's corporate existence shall be terminated
and the receivership concluded.
(Source: P.A. 86-754.)
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(205 ILCS 620/6-12) (from Ch. 17, par. 1556-12)
Sec. 6-12.
The receiver shall serve at the pleasure of the
Commissioner and upon the death, inability to act, resignation
or removal by the Commissioner of a receiver, the Commissioner may
appoint a successor and upon such appointment all rights and duties of the
predecessor shall at once devolve upon such appointee.
(Source: P.A. 85-1402.)
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(205 ILCS 620/6-13) (from Ch. 17, par. 1556-13)
Sec. 6-13.
All expenses of a receivership, including
reasonable receiver's and attorney's fees, approved by the
Commissioner, shall be paid out of the assets of the corporate
fiduciary. All expenses of any preliminary or other examination
into the condition of any such corporate fiduciary or
receivership, and all expenses incident to and in connection with
the possession and control of the corporate fiduciary and its
assets for the purpose of examination, reorganization or
liquidation through receivership shall be paid out of the assets
of such corporate fiduciary. The payment herein authorized may
be made by the Commissioner with monies and property of the
corporate fiduciary in his or her possession and control and
shall have priority over all claims but shall not give rise to a
claim against properties held by the corporate fiduciary in a
fiduciary capacity.
If monies and property of the corporate fiduciary are insufficient to pay
such expenses, they may be paid from the Corporate Fiduciary Receivership
account in the Bank and Trust Company Fund established pursuant to Section
5-10 of this Act.
(Source: P.A. 86-754; 86-952; 86-1028.)
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(205 ILCS 620/6-13.5)
Sec. 6-13.5. Pledging requirements.
(a) The Commissioner may require a trust company holding a certificate of
authority under this Act to pledge to the Commissioner securities or a surety
bond which shall run to the Commissioner in an amount, not to exceed $2,000,000, that the Commissioner deems appropriate for costs associated with
the receivership of the trust company. In the event of a receivership of a
trust company, the Commissioner may, without regard to any priorities,
preferences, or adverse claims, reduce the pledged securities or the surety
bond to cash and, as soon as practicable, utilize the cash to cover costs
associated with the receivership.
(b) If the trust company chooses to pledge securities to satisfy the
provisions of this Section, the securities shall be held at a depository
institution or a Federal Reserve Bank approved by the Commissioner. The
Commissioner may specify the types of securities that may be pledged in
accordance with this Section. Any fees associated with holding such securities
shall be the responsibility of the trust company.
(c) If the trust company chooses to purchase a surety bond to satisfy the
provisions of this Section, the bond shall be issued by a bonding company,
approved by the Commissioner, that is authorized to do business in this State
and that has a rating in one of the 3 highest grades as determined by a
national rating service. The bond shall be in a form approved by the
Commissioner. The trust company may not obtain a surety bond from any entity
in which the trust company has a financial interest.
(Source: P.A. 97-492, eff. 1-1-12.)
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(205 ILCS 620/6-14) (from Ch. 17, par. 1556-14)
Sec. 6-14.
From time to time during receivership the
Commissioner shall make and pay from monies of the corporate
fiduciary a ratable dividend on all claims as may be proved to
his or her satisfaction or adjudicated by the court. After one
year from the entry of a judgment of dissolution, all unclaimed
dividends shall be remitted to the State Treasurer in accordance with the Revised
Uniform Unclaimed Property Act, as now or hereafter amended,
together with a list of all unpaid claimants, their last known addresses and
the amounts unpaid.
(Source: P.A. 100-22, eff. 1-1-18.)
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(205 ILCS 620/6-15) (from Ch. 17, par. 1556-15)
Sec. 6-15.
Whenever the Commissioner shall have taken
possession and control of a corporate fiduciary and its assets
for the purpose of examination, reorganization or liquidation
through receivership, or whenever the Commissioner shall have
appointed a receiver for a corporate fiduciary and filed a
complaint for the dissolution or for the winding up of the
affairs of a corporate fiduciary, and the corporate fiduciary
denies the grounds for such actions, it may at any time within
10 days apply to the Circuit Court of Sangamon County, Illinois,
to enjoin further proceedings in the premises; and such court
shall cite the Commissioner to show cause why further proceedings
should not be enjoined, and if the court shall find that such
grounds do not exist, the court shall make an order enjoining the
Commissioner and any receiver acting under his direction from all
further proceedings on account of such alleged grounds.
(Source: P.A. 85-858.)
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(205 ILCS 620/Art. VII heading) ARTICLE VII.
VOLUNTARY LIQUIDATION
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(205 ILCS 620/7-1) (from Ch. 17, par. 1557-1)
Sec. 7-1.
Voluntary liquidation; procedure.
Any corporate fiduciary
which desires to
retire from business under this Act, shall furnish to the
Commissioner satisfactory evidence of its release and discharge
from all the obligations and trusts hereinbefore provided for,
whereupon the Commissioner shall revoke the certificate of
authority of such corporate fiduciary.
(Source: P.A. 89-364, eff. 8-18-95.)
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(205 ILCS 620/Art. VIII heading) ARTICLE VIII.
OFFENSES AND PENALTIES
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(205 ILCS 620/8-1) (from Ch. 17, par. 1558-1)
Sec. 8-1.
False statements.
It is unlawful for any officer, director,
employee, or
agent of
any corporate fiduciary subject to examination by the Commissioner or any
person filing an application or submitting information in connection with an
application to the Commissioner to willfully and knowingly
subscribe to or make, or cause to be made, any false statement or
false entry with intent to deceive any person or persons
authorized to examine into the affairs of the corporate
fiduciary or applicant or with intent to deceive the Commissioner or his
administrative officers in the performance of their duties under
this Act. A person who violates this Section is guilty of a Class 3
felony.
(Source: P.A. 92-485, eff. 8-23-01.)
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(205 ILCS 620/8-2)
Sec. 8-2.
Reliance on Commissioner.
No corporate fiduciary or other
person shall be liable under this Act for any act done or omitted in good faith
in conformity with any rule, interpretation, or opinion issued by
the Commissioner of Banks and Real Estate, notwithstanding that after the act
or omission has occurred, the rule, opinion, or interpretation upon
which
reliance is placed is amended, rescinded, or determined by judicial or other
authority to be invalid for any reason.
(Source: P.A. 90-161, eff. 7-23-97.)
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(205 ILCS 620/Art. IX heading) ARTICLE IX. MISCELLANEOUS PROVISIONS
(Source: P.A. 97-492, eff. 1-1-12.) |
(205 ILCS 620/9-1)
Sec. 9-1. (Repealed).
(Source: P.A. 90-301, eff. 8-1-97. Repealed by P.A. 97-492, eff. 1-1-12.)
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(205 ILCS 620/9-2)
Sec. 9-2. (Repealed).
(Source: P.A. 90-301, eff. 8-1-97. Repealed by P.A. 97-492, eff. 1-1-12.)
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(205 ILCS 620/9-3)
Sec. 9-3. (Repealed).
(Source: P.A. 85-858. Repealed by P.A. 97-492, eff. 1-1-12.)
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(205 ILCS 620/9-4)
Sec. 9-4. (Repealed).
(Source: P.A. 85-858. Repealed by P.A. 97-492, eff. 1-1-12.)
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(205 ILCS 620/9-5) (from Ch. 17, par. 1559-5)
Sec. 9-5. Applicability of other Acts by reference. Corporate fiduciaries subject to the provisions of this Act shall
continue to be subject to the provisions of other Acts which
govern actions of trustees including, but not limited to:
(a) "An Act to provide for the appointment of successor
trustees in land trust agreements", approved August 13, 1965, as amended.
(b) "An Act to require disclosure, under certification of
perjury, of all beneficial interests in real property held in a
land trust, in certain cases", approved September 21, 1973, as amended.
(c) "An Act in relation to land trusts and the power and
authority of trustees of land trusts to deal with trust
property", approved August 6, 1982, as amended.
(d) "An Act concerning the powers of corporations
authorized to accept and execute trusts, to register and hold
securities of fiduciary accounts in bulk and to deposit same with
a depository", approved September 1, 1972, as amended.
(e) the "Common Trust Fund Act", approved July 29, 1943, as amended.
(f) the Illinois Trust Code.
(g) "An Act concerning liability for participation in
breaches of fiduciary obligations", approved July 7, 1931, as amended.
(Source: P.A. 101-48, eff. 1-1-20.)
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(205 ILCS 620/9-6)
Sec. 9-6.
Audits.
(a) At least once in each calendar year a
trust company must cause its books and records to
be audited by an
independent
licensed public accountant. The Commissioner may prescribe the scope
of the audit within generally accepted audit principles and standards.
(b) The independent licensed public accountant shall provide a written
audit report to the trust company's board of
directors or to a committee
appointed by the trust company's board of
directors. If the audit report
is given to
a committee appointed by the trust company's
board of directors, the
committee
shall, within 30 days after the date of receipt of the audit report, provide
the
board of directors with a written summary of the audit findings as detailed
in the audit report.
The trust company's board of directors shall file with the Commissioner a
copy of any written summary of the audit findings provided to the board
pursuant to this subsection within 45 days after receipt by the board of
the written summary.
(c) The trust company's board of directors or
committee appointed by
the
board of directors shall cause a copy of the audit report to be filed directly by the
independent licensed public accountant with the Commissioner
within 45 days after the audit report is issued.
(d) A trust company that is directly or indirectly owned by a bank
holding company, a financial holding company, or a savings and loan holding
company shall be deemed to be in compliance with the provisions of subsections
(a) through (c) of this Section if the bank holding company, financial holding
company, or savings and loan holding company obtains an audit by an independent
licensed public accountant that includes the trust company and meets the
standards of subsection (a) and, within 45 days after the audit report is
issued, the bank holding company, financial holding company, or savings and
loan holding company causes the independent licensed public accountant to
directly file with the Commissioner the provisions of the audit report relating
to the trust company.
(Source: P.A. 92-485, eff. 8-23-01; 92-685, eff. 7-16-02.)
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