Code of the District of Columbia

Part F. Member Accounts.


§ 26–506.01. Shares and membership shares.

(a) Shares and membership shares shall be subscribed to and paid for in the manner prescribed in the bylaws.

(b) The par value of shares and membership shares shall be as prescribed in the bylaws.

(c) Membership shares may not be pledged as security on any loan.

(d) A District credit union may limit the number of shares that may be owned by a single member.

(e) Shares may be subscribed to, paid for, and transferred in the manner prescribed in the bylaws.

(f) The board of directors may establish different classes of share accounts, classified in relation to different rights, restrictions, and dividend rates.

(g) Notwithstanding any other provision of law, funds deposited in a share account, share certificate, or any other program offered by the District credit union for the purpose of promoting consumer savings shall not constitute consideration or a thing of value for the purposes of a promotional contest or raffle under District law.


(May 6, 2020, D.C. Law 23-86, § 601, 67 DCR 3476.)


§ 26–506.02. Dividends.

(a) The board of directors may, after making provisions for required reserves, declare dividends to be paid on share accounts and membership shares, if any, from the net earnings or undivided earnings, as provided in the bylaws. The board may authorize the intervals and periods for dividend payments.

(b) Dividends may be paid at various rates with due regard to the conditions that pertain to each type of account, such as minimum balance, notice, and time requirements.

(c) Dividends need not be paid on membership shares, but if a dividend is paid, it may be added to the membership share held by each member.

(d) Dividends shall not be declared or paid at a time when the District credit union is insolvent, its net assets are less than its stated capital, or when the payment thereof would render the District credit union insolvent or reduce its net assets below its stated capital.


(May 6, 2020, D.C. Law 23-86, § 602, 67 DCR 3476.)


§ 26–506.03. Deposit Accounts.

(a) A District credit union may accept deposit accounts from its members, other District credit unions, federal credit unions, foreign credit unions, and government units, subject to the terms, rates, and conditions established by the board of directors and applicable local and federal laws and regulations.

(b) Interest may be paid on deposit accounts at various rates with due regard to the conditions that pertain to each type of account, such as minimum balance, notice, and time requirements.

(c) A District credit union may engage in savings or account programs established by federal, state, or local governments.

(d) A District credit union designated as a low-income credit union may accept non-member deposits.


(May 6, 2020, D.C. Law 23-86, § 603, 67 DCR 3476.)


§ 26–506.04. Withdrawals.

(a) Funds in share and deposit accounts may be withdrawn for payment to the account holder or to third parties, in the manner and in accordance with the procedures that are established by the board of directors, subject to any regulations the Commissioner prescribes.

(b) Share, membership share, and deposit accounts shall be subject to any withdrawal notice requirement imposed by the bylaws.

(c) A membership share may only be redeemed or withdrawn after termination of membership in the District credit union, and at a value proportionate to its current value.


(May 6, 2020, D.C. Law 23-86, § 604, 67 DCR 3476.)


§ 26–506.05. Accounts for minors.

Payments on share and deposit accounts may be received from a minor with consent from the minor's parent or guardian. The minor may withdraw funds from these accounts, including the dividends and interest thereon. If shares are issued in the name of a minor, the redemption of any part or all of the shares, or a withdrawal of funds by payment to the minor of the shares or funds, and any declared dividends or interest, releases the District credit union from all obligations to the minor as to the shares redeemed or funds withdrawn.


(May 6, 2020, D.C. Law 23-86, § 605, 67 DCR 3476.)


§ 26–506.06. Joint accounts.

(a) A member may designate any person or persons to own a share account with the member, in joint tenancy with the right of survivorship, as a tenant in common, or under any other form of joint ownership permitted by law and allowed by the District credit union.

(b) Payment may be made, in whole or in part, to any of the joint owners, if an agreement permitting the payment was signed and dated by all persons when the shares were issued or thereafter. Payment made pursuant to this section shall discharge the District credit union from all claims for amounts paid, whether or not the payment is consistent with the beneficial ownership of the account.

(c) If more than one joint owner seeks District credit union membership through a joint account, each prospective member shall meet any membership requirements described in the District credit union's bylaws.


(May 6, 2020, D.C. Law 23-86, § 606, 67 DCR 3476.)


§ 26–506.07. Payable on death accounts.

Notwithstanding any other provision of law, a District credit union may establish share and deposit accounts payable to one or more persons during their lifetimes, and upon the death of every included account holder to one or more payable on death payees. A transfer to a payable on death payee is effective by reason of the account contract and shall not be considered a testamentary transfer.


(May 6, 2020, D.C. Law 23-86, § 607, 67 DCR 3476.)


§ 26–506.08. Trust accounts.

(a) Share and deposit accounts may be owned by one or more members in trust for one or more beneficiaries or by one or more nonmembers in trust for one or more beneficiaries who are members.

(b) Payment of part or all of a trust account to the party in whose name the account is held shall, to the extent of the payment, discharge the liability of the District credit union to that party and the beneficiary, and the District credit union shall be under no obligation to verify the application of the payment.


(May 6, 2020, D.C. Law 23-86, § 608, 67 DCR 3476.)


§ 26–506.09. Trust services.

A District credit union may accept and execute trusts pursuant to the laws of the District.


(May 6, 2020, D.C. Law 23-86, § 609, 67 DCR 3476.)


§ 26–506.10. Liens.

(a) The District credit union shall have a lien on the membership share, shares, deposits, and accumulated dividends and interest of a member in the member's individual, joint, trust, or payable on death account for any obligation owed to the District credit union by the member or for any loan co-signed or guaranteed by the member; except, that a District credit union shall not have a lien on any funds in an Individual Retirement Account or an account established pursuant to the Internal Revenue Code of the United States.

(b) The District credit union shall have a right of immediate set-off with respect to every deposit and share account. The District credit union may refuse to allow withdrawals from any share or deposit account while the member has any outstanding obligation to the District credit union.


(May 6, 2020, D.C. Law 23-86, § 610, 67 DCR 3476.)


§ 26–506.11. Reduction in membership shares.

(a) The board of directors of a District credit union may propose a reduction in membership shares when the losses of the District credit union resulting from a depreciation in value of its loans, investments, or otherwise exceed the District credit union's undivided earnings and reserves so that the estimated value of the District credit union's assets is less than its liabilities, and the board of directors determines that the District credit union may be subject to involuntary liquidation. The District credit union may, by a majority vote of those voting on the proposition, order a reduction in the membership shares, and of each of its shareholders, to divide the loss in proportion to the shares held by shareholders in their respective membership share accounts ("order of reduction").

(b) If the District credit union thereafter realizes a greater amount from its assets than what was fixed by the order of reduction, the excess shall be proportionately restored to the shareholders whose assets were reduced, but only to the extent of the reduction.

(c) Deposit accounts and regular share accounts shall not be subject to a reduction in shares pursuant to this section.


(May 6, 2020, D.C. Law 23-86, § 611, 67 DCR 3476.)


§ 26–506.12. Share and deposit insurance.

(a) A District credit union shall apply for and obtain insurance on its members' share and deposit accounts as provided by NCUA or comparable insurance approved by the Commissioner.

(b) No District credit union shall be granted a charter by the Commissioner unless the District credit union has applied for and obtained insurance of its members' share and deposit accounts as provided by this section or received a written commitment to insure or guarantee member accounts.

(c) A District credit union with debt and equity capital consisting primarily of funds received from other credit unions and any membership share issued by a District credit union shall not be subject to the requirements of this section.

(d) A District credit union that has been denied a commitment of insurance or guarantee of its members' share and deposit accounts or that has had that insurance or guarantee revoked, cancelled, or terminated shall, within 30 days of the effective date of the revocation, cancellation, or termination, commence steps to liquidate, merge with an insured credit union, or apply in writing to the Commissioner for an extension of time to obtain an insurance commitment.

(e) The Commissioner may grant one or more extensions of time in which to obtain the insurance commitment upon satisfactory evidence that the District credit union has made, or is making, a substantial effort to satisfy the conditions precedent to the issuance of an insurance commitment.

(f) To permit NCUA or an authorized share guaranty corporation to assess the financial condition and performance of a District credit union, the Commissioner may provide NCUA or an authorized share guaranty corporation with any and all reports of examination conducted by the Commissioner, and copies of orders and notices issued by the Commissioner, regarding any District credit union under the Commissioner's supervision.

(g) NCUA or an authorized share guaranty corporation shall provide to the Commissioner copies of any reports of examinations conducted by NCUA or the authorized share guaranty corporation on a District credit union.

(h) In addition to the primary guaranteed amount, an authorized share guaranty corporation or other insurance company may provide an excess coverage guarantee for the benefit of those District credit unions that voluntarily elect to obtain an additional guarantee.

(i) The Commissioner may appoint NCUA or any official of an authorized share guaranty corporation as the liquidating agent of a District credit union. This appointment is limited to actions arising under §§ 26-509.01 and 26-510.05.


(May 6, 2020, D.C. Law 23-86, § 612, 67 DCR 3476.)


§ 26–506.13. Authority to withhold payment.

(a) Nothing contained in this subchapter shall be deemed to require a District credit union to make any payment from an account to a depositor, shareholder, trust, or payable-on-death account beneficiary, or any other person claiming an interest in any funds in an account, if the District credit union has actual knowledge of the existence of a dispute between the depositors, shareholders, beneficiaries, or other persons concerning their respective rights of ownership to the funds contained in, proposed to be withdrawn from, previously withdrawn from, the account, or if the District credit union is otherwise uncertain as to who is entitled to the funds pursuant to the account agreement.

(b) The District credit union may, without liability, notify in writing, all depositors, shareholders, beneficiaries, or other persons claiming an interest in the account of the District credit union's uncertainty as to who is entitled to the funds or of the existence of a dispute and may, without liability, refuse to disburse any funds contained in the account to any depositor, shareholder, trust, payable on death account beneficiary of the account, or other persons claiming an interest in the account until:

(1) Each of the depositors, shareholders, and beneficiaries has consented to the requested payment in writing; or

(2) The payment is authorized or directed by a court of proper jurisdiction.


(May 6, 2020, D.C. Law 23-86, § 613, 67 DCR 3476.)