Code of the District of Columbia

Part E. Credit Union Governance.


§ 26–505.01. Authority and duty of a board of directors.

(a) The business and affairs of a District credit union shall be managed by the board of directors of the District credit union. The duties of the board of directors of a District credit union include the following duties:

(1) The board of directors shall:

(A) Set the par value of shares, if any, of the District credit union;

(B) Set the minimum number of shares, if any, required for membership;

(C) Designate those persons or positions authorized to execute or certify documents or records on behalf of the District credit union;

(D) Authorize the purchase of adequate fidelity and insurance coverage for officers, directors, committee members, and employees, and for losses caused by persons outside the District credit union for which the District credit union may be liable;

(E) Authorize the employment and compensation of the chief executive officer;

(F) Approve an annual operating budget for the District credit union;

(G) Authorize the conveyance or lease of real property;

(H) Review and approve the annual audit;

(I) Appoint any committees the board considers necessary;

(J) Establish conditions under which a member may be removed for cause, as defined in § 26-504.07; and

(K) Perform any other duties, or authorize any other actions, that are not inconsistent with this subchapter or the District credit union's bylaws.

(2) The board of directors shall:

(A) Establish policies under which the District credit union may borrow, lend, and invest money to carry on the functions of the District credit union;

(B) Act upon applications for membership in the District credit union;

(C) Establish the loan policies under which loans may be approved;

(D) Determine the amount that may be loaned to a member together with the terms and conditions of the loan;

(E) Declare dividends on shares and set the rate of interest on deposits; and

(F) Approve the charge-off of District credit union losses.

(b) The duties listed in subsection (a)(1) of this section shall not be delegated by the District credit union's board of directors. The duties listed subsection (a)(2) of this section may be delegated to a committee, officer, or employee of the District credit union with appropriate reporting to the board.


(May 6, 2020, D.C. Law 23-86, § 501, 67 DCR 3476.)


§ 26–505.02. Election of a board of directors.

(a)(1) A board of directors shall:

(A) Consist of an odd number of directors;

(B) Be at least 5 in number; and

(C) Be elected by and from natural person members.

(2) A District credit union's bylaws shall set forth the qualifications for nomination to the board.

(b) All members of the board of directors shall hold office for the terms provided for in the bylaws. Terms may be staggered so that an approximately equal number of terms expire each year.

(c) A director shall hold office for the term for which the director was elected and until a successor is elected and qualified.


(May 6, 2020, D.C. Law 23-86, § 502, 67 DCR 3476.)


§ 26–505.03. Appointment of committees.

(a) The board of directors shall appoint an audit committee of no fewer than 3 members of the District credit union, who may, but need be, members of the board of directors. The board shall appoint the audit committee at an organizational meeting held within 30 days of each annual election of directors for the terms provided in the bylaws.

(b) The board of directors may appoint other committees necessary or convenient to the operation of the District credit union.

(c) Unless specifically prohibited by the bylaws, committee members may participate in and act at any meeting of the committee through the use of communications equipment; provided, that all persons participating in the meeting can speak with and hear each other at the same time. Participation in a meeting in this manner shall constitute attendance.

(d) Unless specifically prohibited by the bylaws, any action required by this subchapter to be taken at a committee meeting, or any other action that may be taken at a committee meeting, may be taken without a meeting if all members of the committee sign a consent to the action in a writing that sets forth the action. Consent shall be evidenced by one or more written approvals, which describe the action taken and bear the signature of one or more committee members.


(May 6, 2020, D.C. Law 23-86, § 503, 67 DCR 3476.)


§ 26–505.04. Vacancies.

(a) A seat on a District credit union's board of directors or on one of the District credit union's committees will be considered vacant if a board or committee member:

(1) Resigns from his or her position on the board or committee;

(2) Is removed from the board or committee;

(3) Is unable to carry out his or her duties as a board or committee member; or

(4) Is made ineligible by operation of law.

(b) The board of directors shall fill any vacancies occurring on the board or on any board-appointed committee from among the District credit union's natural person members.


(May 6, 2020, D.C. Law 23-86, § 504, 67 DCR 3476.)


§ 26–505.05. Compensation of officials.

(a)(1) A District credit union may compensate an officer, director, or committee member for the member's services to the District credit union.

(2) Life, health, accident, and similar insurance protection provided by a District credit union to an officer, director, or committee member shall not be considered compensation.

(b) A District credit union may reimburse directors, officers, and committee members for necessary expenses incidental to the performance of the official business of the District credit union.


(May 6, 2020, D.C. Law 23-86, § 505, 67 DCR 3476.)


§ 26–505.06. Limited liability of directors and officers.

(a) No director or officer of a District credit union shall be liable, and no cause of action may be brought against a director or officer of a District credit union, for damages resulting from:

(1) The exercise of judgment or discretion in connection with the duties or responsibilities of the director or officer unless the act or omission involved willful or wanton conduct; or

(2) An act or omission in rendering official service unless the act or omission involved willful or wanton conduct.

(b) For the purposes of this section, the term "willful or wanton conduct" means a course of action that shows an actual or deliberate intention to cause harm or violate a statute, or, if not intentional, shows an utter indifference to, or conscious disregard for, the safety of others or their property.

(c) Nothing in this section is intended to bar any cause of action against a District credit union or to change the liability of a District credit union arising out of an act or omission of any director, officer, or person exempt from liability for negligence under this section.

(d) In discharging his or her duties, a director may rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by:

(1) One or more officers or employees of the District credit union whom the director reasonably believes to be reliable and competent in the matters presented;

(2) Legal counsel, public accountants, or other persons as to matters the director reasonably believes are within the person's professional or expert competence; or

(3) A committee of the board of directors of which the director is not a member if the director reasonably believes the committee merits confidence.

(e) A director may not rely on information, opinions, reports, or statements described in subsection (d) of this section if the director has knowledge concerning the matter in question that makes reliance on the information, opinion, report, or statement unwarranted.

(f) A director is not liable for any action taken as a director or for any failure to take any action if the director performed the duties of the director's office in compliance with this section.


(May 6, 2020, D.C. Law 23-86, § 506, 67 DCR 3476.)


§ 26–505.07. Conflicts of interest.

Directors, committee members, and officers shall disclose all existing and potential conflicts of interest to the board of directors. No director, committee member, officer, or employee of a District credit union shall, in any manner, directly or indirectly, participate in the deliberation upon, or the determination of, any question affecting his or her pecuniary interest or the pecuniary interest of any corporation, partnership, or association in which he or she is directly or indirectly interested.


(May 6, 2020, D.C. Law 23-86, § 507, 67 DCR 3476.)


§ 26–505.08. Officers.

(a) The board of directors, at their organizational meeting, shall elect from their own number, a chairperson of the board, a treasurer, and a secretary. The board may also elect any other officers of the board that are specified in the bylaws.

(b) The term of an officer shall be for one calendar year, or until a successor is chosen and has been duly qualified, unless otherwise provided in the bylaws.

(c) The duties of the officers shall be prescribed in the bylaws.

(d) Notwithstanding any other provision of this subchapter, a District credit union may use any title it chooses for officials holding the positions described in this section, provided that the titles are not misleading.


(May 6, 2020, D.C. Law 23-86, § 508, 67 DCR 3476.)


§ 26–505.09. Meetings of directors.

(a) The board of directors shall meet on a regular basis and at least quarterly.

(b) Unless specifically prohibited by the bylaws, directors may participate in, and act at, any meeting of the board through the use of communications equipment through which all persons participating in the meeting can speak with and hear each other at the same time. Participation in the meeting in this manner shall constitute attendance.

(c) Unless specifically prohibited by the bylaws, any action required by this subchapter to be taken at a meeting of the board of directors, or any other action that may be taken at a meeting of the board of directors, may be taken without a meeting if a consent, in writing, setting forth the action is signed by all the directors entitled to vote with respect to the subject matter thereof. Consent shall be evidenced by one or more written approvals, which describe the action taken.


(May 6, 2020, D.C. Law 23-86, § 509, 67 DCR 3476.)


§ 26–505.10. Audits.

(a) Unless the District credit union has been audited by a licensed public accountant or other qualified person or firm, the audit committee shall make, or cause to be made, a comprehensive annual audit of the books and affairs of the District credit union. The audit committee shall submit a report of each annual audit to the board of directors and a summary of that report to the members of the District credit union at the next annual meeting of the District credit union.

(b) The audit committee shall make, or cause to be made, any supplementary audits, examinations, and verifications of members' accounts that it considers necessary or that are required by the Commissioner or the board of directors of the District credit union. The audit committee shall submit reports of these supplementary audits to the board of directors.


(May 6, 2020, D.C. Law 23-86, § 510, 67 DCR 3476.)


§ 26–505.11. Suspension and removal powers.

(a) The board of directors may suspend any member of the District credit union's board of directors for cause, as defined in § 26-504.07, by a 2/3 vote of a quorum of the board. The board member shall be suspended until the next members' meeting, which shall be held no fewer than 7 days and not more than 60 days after the suspension. The suspended board member shall be notified of the details of the member's suspension and shall have a right to request a hearing before the board to reconsider the suspension prior to the next membership meeting.

(b) Any suspended board member may be removed by a majority vote of a quorum of members at a properly called membership meeting. The suspended board member shall be notified of the details of the board member's removal. At the membership meeting, the suspended board member shall have the right to appear and be heard. The suspension shall be acted upon by the members and the suspended board member shall be removed from or restored to office.

(c) The board of directors may, by a 2/3 vote of a quorum of the board, suspend or remove any officer from his or her office for cause, as defined in § 26-504.07. The officer affected will be notified of the suspension or removal and shall have the right to request a hearing before the board of directors for reconsideration of the board's decision.


(May 6, 2020, D.C. Law 23-86, § 511, 67 DCR 3476.)