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Credit Administration shall find that the financial structure of such corporation is sound and unimpaired and by him approved, nor shall any loan be made upon the capital stock of such corporation until the management of such company shall be made known to and approved by the Governor, and the Governor shall have the right at any time to declare the indebtedness to the Government that may be created hereunder due whenever in his judgment the financial structure of the corporation shall become so impaired or the management become so unsatisfactory as to jeopardize the interests of the Government. (Mar. 3, 1932, ch. 70, § 2, 47 Stat. 60; Ex. Ord. No. 6084, Mar. 27, 1933.)

TRANSFER OF FUNCTIONS “Governor of the Farm Credit Administration" and "Governor” were substituted for "Secretary of Agriculture” and “Secretary," respectively and other changes were effected by Ex. Ord. No. 6084, cited to text, which is set out in full at the beginning of Chapter 7 of this title.

8 1403. Minimum paid-in capital stock required to warrant loans.—No loan or advance shall be made to any individual upon the capital stock of or to create or increase the capital stock of any corporation, unless the paid-in capital stock of such corporation shall be at least $10,000. (Mar. 3, 1932, ch. 70, § 3, 47 Stat. 60.)

§ 1404. Appropriations; revolving fund.—To carry out the provisions of this chapter, including all expenses incurred thereunder, there are authorized to be appropriated, out of the unexpended balances of appropriations made to carry out the provisions of Public Resolution Numbered 112. Seventy-first Congress (46 Stat. 1032), as amended by the Interior Department Appropriation Act for the fiscal year ending June 30, 1932, and as amended by Public Resolution Numbered 120 (46 Stat. 1167), and out of the collections from loans made under Public Resolution Numbered 112, as so amended, a sum not exceeding $10,000,000, which sum shall be paid into a revolving fund. Not to exceed 2 per centum of such fund may be used for expenses of administration. All moneys received from time to time upon the repayment of any advance or loan made pursuant to this chapter, together with the interest, shall be paid into the revolving fund and shall thereafter be available for the purposes and in the manner hereinbefore provided. (Mar. 3, 1932, ch. 70, § 4, 47 Stat. 60.)

FEDERAL CREDIT UNIONS

§ 1751. Citation of chapter.—This chapter may be cited as the Federal Credit Union Act." (June 26, 1934, ch. 750, § 1, 48 Stat. 1216.)

Ex. Ord. No. 9148
CREDIT UNION FUNCTIONS, RECORDS, PROPERTY,

AND PERSONNEL
Ex. Ord. No. 9148, April 27, 1942, 7 F. R. 3145, provided :

By virtue of the authority vested in me by Title I of the First War Powers Act, 1941, approved December 18, 1941 (Public Law 354, 77th Congress), it is hereby ordered as follows:

1. TRANSFER OF FUNCTIONS All functions, powers, and duties of the Farm Credit Administration and of the Governor thereof under the Federal Credit Union Act, as amended, (Title 12 U. S. C. $$ 1751-1771) are transferred to the Federal Deposit Insurance Corporation.

2. TRANSFER OF RECORDS, PROPERTY, AND PERSONNEL All records and property (including office equipment) and all personnel of the Farm Credit Administration used primarily in the administration of functions transferred by this order are transferred to the Federal Deposit Insurance Corporation for use in the administration of the functions transferred by this order; but any personnel so transferred who are found by the Federal Deposit Insurance Corporation to be in excess of the personnel necessary for the administration of such functions, powers, and duties shall be retransferred under existing law to other positions in the Government or separated from the service.

3. TRANSFER OF FUNDS So much of the unexpended balances of appropriations or other funds available (including those available for the fiscal year ending June 30, 1943) to the Farm Credit Administration in the exercise of the functions transferred by this order, as the Director of the Bureau of the Budget with the approval of the President shall determine, shall be transferred to the Federal Deposit Insurance Corporation for use in connection with the exercise of the functions so transferred. In determining the amount to be transferred the Director of the Bureau of the Budget may include an amount to provide for the liquidation of obligations incurred against such appropriations or other funds prior to the transfer.

4. EFFECTIVE AND TERMINATION DATES This order shall become effective as of May 16, 1942, and shall continue 'in force and effect until the termination of Title I of the First War Powers Act, 1941. (50 App. § 601 et seq.)

$ 1752. Definitions.-A Federal credit union is hereby defined as a cooperative association organized in accordance with the provisions of this chapter for the purpose of promoting thrift among its members and creating a source of credit for provident or productive purposes. When used in this chapter the term “Administration" means Farm Credit Administration, and the term "Governor" means the Governor thereof. (June 26, 1934, ch. 750, $ 2, 48 Stat. 1216.)

TRANSFER OF FUNCTIONS The Farm Credit Administration was transferred to the Department of Agriculture by Reorg. Plan No. I, § 401, eff. July 1, 1939, 4 Fed. Reg. 2730, 53 Stat. 1429.

$ 1753. Federal credit union organization.-Any seven or more natural persons who desire to form a Federal credit union shall subscribe before some officer competent to administer oaths an organization certificate in duplicate which shall specifically state

(1) The name of the association.

(2) The location of the proposed Federal credit union and the territory in which it will operate.

(3) The names and addresses of the subscribers to the certificate and the number of shares subscribed by each.

(4) The par value of the shares, which shall be $5 each.
(5) The proposed field of membership, specified in detail.

(6) The term of the existence of the corporation, which may be perpetual.

(7) The fact that the certificate is made to enable such persons to avail themselves of the advantages of this chapter.

Such organization certificate may also contain any provisions approved by the Governor for the management of the business of the association and for the conduct of its affairs and relative to the powers of its directors, officers, or stockholders. (June 26, 1934, ch. 750, $ 3, 48 Stat. 1217.)

§ 1754. Approval of organization certificate.Any such organization certificate shall be presented to the Governor for approval. Upon such approval the Federal credit union shall be a body corporate and as such, subject to the limitations herein contained, shall be vested with all of the powers and charged with all the liabilities conferred and imposed by this chapter upon corporations organized hereunder. Before any organization certificate is approved an appropriate investigation shall be made for the purpose of determining (1) whether the organization certificate conforms to the provisions of this chapter; (2) the general character and fitness of the subscribers thereto; and (3) the economic advisability of establishing the proposed Federal credit union. Upon approval of such organization certificate by the Governor it shall be the charter of the corporation, and one of the originals thereof shall be delivered to the corporation after the payment of the fee required therefor. (June 26, 1934, ch. 750, $ 4, 48 Stat. 1217.)

§ 1755. Fees.—For the purpose of paying the cost incident to the ascertainment of whether an organization certificate should be approved the subscribers to any such certificate shall pay, at the time of filing their organization certificate, the amount prescribed by the Governor, which shall not exceed $20 in any case; and on the approval of any organization certificate they shall also pay a fee of $5. During December of each calendar year each Federal credit union shall pay to the Administration a fee of not to exceed $10, to be fixed by the Governor, for the cost of supervision: Provided, however, That no such annual fee shall be payable by such an organization for the fractional part of the first calendar year during which it is formed. All such fees shall be deposited with the Treasurer of the United States for the account of the Administration and may be expended by the Governor for such administrative and other expenses incurred in carrying out the provisions hereof as he may determine to be proper, the purpose of such fees being to defray, as far as practicable, the administrative and supervisory costs incident to the carrying out of this chapter. (June 26, 1934, ch. 750, § 5, 48 Stat. 1217.)

8 1756. Reports and examinations.—Federal credit unions shall be under the supervision of the Governor, and shall make such financial reports to him (at least annually) as he may require. Each Federal credit union shall be subject to examination by, and for this purpose shall make its books and records accessible to, any person designated by the Governor. The Governor shall fix a scale of examination fees to be paid by Federal credit unions, giving due consideration to the time and expense incident to such examinations, and to the ability of Federal credit unions to pay such fees, which fees shall be assessed against and paid by each

Federal credit union promptly after the completion of such examination. Examination fees collected under the provisions of this section shall be deposited to the credit of the special fund created by section 1755 hereof, and shall be available for the purposes specified in said section 1755. (June 26, 1934, ch. 750, $ 6, 48 Stat. 1218; Dec. 6, 1937, ch. 3, § 1, 51 Stat. 4.)

§ 1756a. Reimbursement of Farm Credit Administration personnel for use of private automobiles for examining, supervising, and servicing credit unions.—Officers and employees of the Farm Credit Administration who under proper authorization use privately owned automobiles in the performance of official travel within the corporate limits of their official stations for the purpose of examining, supervising, or servicing Federal credit unions located within said corporate limits, may be reimbursed for such travel at a rate not to exceed 3 cents per mile. (July 22, 1942, ch. 516, § 1, 56 Stat. 700.)

CROSS REFERENCES

Transfer of functions, etc., for duration of war to Federal Deposit Insurance Corporation, see Ex. Ord. No. 9148, under section 1751.

$ 1757. Powers.--A Federal credit union shall have succession in its corporate name during its existence and shall have power

(1) To make contracts. (2) To sue and be sued.

(3) To adopt and use a common seal and alter the same at pleasure.

(4) To purchase, hold, and dispose of property necessary and incidental to its operations.

(5) To make loans with maturities not exceeding two years to its members for provident or productive purposes upon such terms and conditions as this chapter and the bylaws provide and as the credit committee may approve, at rates of interest not exceeding 1 per centum per month on unpaid balances (inclusive of all charges incident to making the loan): Provided, That no loans to a director, officer, or member of a committee shall exceed the amount of his holdings in the Federal credit union as represented by shares thereof. No director, officer, or committee member shall endorse for borrowers. A borrower may repay his loan, prior to maturity, in whole or in part on any business day.

(6) To receive from its members payments on shares.

(7) To invest its funds (a) in loans exclusively to members; (b) in obligations of the United States of America, or securities fully guaranteed as to principal and interest thereby; (c) in accordance with rules and regulations prescribed by the Governor, in loans to other credit unions in the total amount not exceeding 25 per centum of its paid-in and unimpaired capital and surplus; (d) and in shares or accounts of Federal savings and loan associations.

(8) To make deposits in national banks and in State banks, trust companies, and mutual savings banks operating in accordance with the laws of the State in which the Federal credit union does business.

(9) To borrow (from any source) in an aggregate amount not exceeding 50 per centum of its paid-in and unimpaired capital and surplus: Provided, That any Federal credit union may discount with or sell to any Federal intermediate credit bank any eligible obligations up to the amount of its paid-in and unimpaired capital, subject to such rules and regulations as may be prescribed by the Governor.

(10) To fine members, in accordance with the bylaws, for failure to meet promptly their obligations to the Federal credit union.

(11) To impress and enforce a lien upon the shares and dividends of any member, to the extent of any loan made to him and any dues or fines payable by him.

(12) To exercise such incidental powers as shall be necessary or requisite to enable it to carry on effectively the business for which it is incorporated. (June 26, 1934, ch. 750, § 7, 48 Stat. 1218; Dec. 6, 1937, ch. 3, § 2,51 Stat. 4.)

$ 1758. Bylaws. In order to simplify the organization of Federal credit unions the Governor shall, on June 26, 1934, cause to be prepared a form of organization certificate and a form of bylaws, consistent with this chapter, which shall be used by Federal credit union incorporators, and shall be supplied to them on request. At the time of presenting the oganization certificate the incorporators shall also submit proposed bylaws to the Governor for his approval. (June 26, 1934, ch. 750, 8 8, 48 Stat. 1219.)

8 1759. Membership.-Federal credit union membership shall consist of the incorporators and such other persons and incorporated and unincorporated organizations, to the extent permitted by rules and regulations prescribed by the Governor, as may be elected to membership and as shall, each, subscribe to at least one share of its stock and pay the initial installment thereon and the entrance fee; except that Federal credit union membership shall be limited to groups having a common bond of occupation, or association, or to groups within a well-defined neighborhood, community, or rural district. (June 26, 1934, ch. 750, 89, 48 Stat. 1219.)

§ 1760. Members' meetings.—The fiscal year of all Federal credit unions shall end December 31. The annual meeting of each Federal credit union shall be held at such time during the month of the following January and at such place as its bylaws shall prescribe. Special meetings may be held in the manner indicated in the bylaws. No member shall be entitled to vote by proxy, but a member other than a natural person may vote through an agent designated for the purpose. Irrespective of the number of shares held by him, no member shall have more than one vote. (June 26, 1934, ch. 750, § 10, 48 Stat. 1219.)

§ 1761. Management-(a) Generally. The business affairs of a Federal credit union shall be managed by a board of not less than five directors, a credit committee of not less than three members, and a supervisory Committee of three members (a majority of whom shall not be directors) all to be elected by the members (and from their number) at their annual meeting, and to hold office for such terms, respectively, as the bylaws may pro

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