Joint Ownership Share Accounts
| Published date | 24 February 2021 |
| Citation | 86 FR 11098 |
| Record Number | 2021-03671 |
| Section | Rules and Regulations |
| Court | National Credit Union Administration |
Federal Register, Volume 86 Issue 35 (Wednesday, February 24, 2021)
[Federal Register Volume 86, Number 35 (Wednesday, February 24, 2021)]
[Rules and Regulations]
[Pages 11098-11102]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-03671]
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NATIONAL CREDIT UNION ADMINISTRATION
12 CFR Part 745
RIN 3133-AF11
Joint Ownership Share Accounts
AGENCY: National Credit Union Administration (NCUA).
ACTION: Final rule.
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SUMMARY: The NCUA Board (Board) is amending its share insurance
regulation governing the requirements for a share account to be
separately insured as a joint account by the National Credit Union
Share Insurance Fund (NCUSIF). Specifically, the final rule provides an
alternative method to satisfy the membership card or account signature
card requirement necessary for insurance coverage (signature card
requirement). Under the final rule, even if an insured credit union
cannot produce membership cards or account signature cards signed by
the joint accountholders, the signature card requirement can be
satisfied by information contained in the account records of the
insured credit union establishing co-ownership of the share account.
For example, the signature card requirement can be satisfied by the
credit union having issued a mechanism for accessing the account, such
as a debit card, to each co-owner or evidence of usage of the joint
share account by each co-owner.
DATES: The final rule is effective March 26, 2021.
FOR FURTHER INFORMATION CONTACT: Thomas I. Zells, Staff Attorney,
Office of General Counsel, at 1775 Duke Street, Alexandria, VA 22314 or
telephone: (703) 548-2478.
SUPPLEMENTARY INFORMATION:
I. Introduction
II. Final Rule
III. Legal Authority
IV. Discussion of Public Comments Received on the Proposed Rule
V. Regulatory Procedures
I. Introduction
A. Background
In May 2020, the Board approved a notice of proposed rulemaking \1\
(proposal or proposed rule) that amended the NCUA's share insurance
regulation governing the requirements for a share account to be insured
separately as a joint account. \2\ Specifically, the proposal addressed
the requirement for separate joint account insurance that each co-owner
of a joint account has personally signed a membership card or account
signature card. In the event a federally insured credit union (FICU)
could not produce from its records such membership cards or account
signature cards, the proposal explicitly permitted the use of other
evidence contained in a FICU's account records to satisfy the signature
card requirement.
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\1\ 85 FR 34545 (June 6, 2020).
\2\ 12 CFR 745.8.
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The proposed amendment mirrors a change made by the Federal Deposit
Insurance Corporation (FDIC) in 2019 for federally insured depository
institutions.\3\ In proposing the change, the Board intended to better
facilitate the prompt payment of share insurance in the event of a
FICU's failure by explicitly providing alternative methods that the
NCUA could use to determine the owners of joint accounts, consistent
with the NCUA's statutory authority. The Board emphasizes that this
change was not proposed, and is not being finalized, in reaction to any
observed current problem with respect to identifying qualifying joint
accounts at credit unions and processing insurance payments timely.
Rather, the Board issued the proposed rule because it is important to
maintain parity between the nation's two Federal deposit/share
insurance programs and to provide credit union members with equal
access to insurance coverage. The Board proposed these regulatory
changes with the belief that they will promote further confidence in
the credit union system and embody a forward-looking approach that will
explicitly permit the use of new and innovative technologies and
processes to meet the NCUA's policy objectives.
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\3\ 84 FR 35022 (July 22, 2019).
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Under the Federal Credit Union Act (FCU Act), the NCUA is
responsible for paying share insurance to any member, or to any person
with funds lawfully held in a member account, in the event of a FICU's
failure up to the standard maximum share insurance amount (SMSIA),
which is currently set at $250,000.\4\ The FCU Act states that the
determination of the net amount of share insurance paid ``shall be in
accordance with such regulations as the Board may prescribe'' and
requires that, ``in determining the amount payable to any member, there
shall be added together all accounts in the credit union maintained by
that member for that member's own benefit, either in the member's own
name or in the names of others.'' \5\ However, the FCU Act also
specifically authorizes the Board to ``define, with such
classifications and exceptions as it may prescribe, the extent of the
share insurance coverage provided for member accounts, including member
accounts in the name of a minor, in trust, or in joint tenancy.'' \6\
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\4\ 12 U.S.C. 1787(k)(1)(A), (6).
\5\ 12 U.S.C. 1787(k)(1)(B).
\6\ 12 U.S.C. 1787(k)(1)(C).
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The NCUA has implemented these requirements by issuing regulations
recognizing particular categories of accounts, such as single ownership
accounts and joint ownership accounts.\7\ If an account meets the
requirements for a particular category, the account is insured up to
the $250,000 limit separately from shares held by the member in a
different account category at the same FICU. For example, provided all
requirements are met, shares in the single ownership category will be
separately insured from shares in the joint ownership category held by
the same member at the same FICU.
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\7\ 12 CFR part 745.
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Section 745.8 of the NCUA's regulations governs insurance coverage
for joint ownership accounts.\8\ Joint ownership accounts include share
accounts held pursuant to various forms of co-ownership under state
law. For example, joint tenants could each hold an equal, undivided
interest in a share
[[Page 11099]]
account. Section 745.8 provides that only ``qualifying joint accounts''
are insured separately from individually owned share accounts
maintained by the co-owners.\9\ ``Qualifying joint accounts'' generally
must satisfy two requirements: (1) Each co-owner has personally signed
a membership card or account signature card; and (2) each co-owner
possesses withdrawal rights on the same basis.\10\ If a joint account
is not a qualifying joint account, each co-owner's actual ownership
interest in the account is considered individually owned and added to
any other accounts individually owned by the co-owner and insured up to
the SMSIA in the aggregate.\11\ This may result in some uninsured
shares if a member's single ownership accounts at the same FICU,
including shares in any non-qualifying joint accounts, exceed $250,000.
Additionally, it is worth reiterating that, with limited exceptions,
the FCU Act generally limits NCUA share insurance coverage to ``member
accounts.'' \12\ Despite this general limitation, the FCU Act \13\ and
the NCUA's regulations \14\ do allow a nonmember to become a joint
owner with a member on a joint account with right of survivorship. The
regulations provide that a nonmember's interest in such accounts will
be insured in the same manner as the member joint-owner's interest.
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\8\ 12 CFR 745.8.
\9\ Id.
\10\ 12 CFR 745.8(c).
\11\ 12 CFR 745.8(d).
\12\ 12 U.S.C. 1752(5).
\13\ 12 U.S.C. 1759(a).
\14\ 12 CFR 745.8(e).
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The signature requirement has been included in the regulation
governing insurance coverage since its inception in 1971.\15\ The FDIC
has had a substantially similar signature requirement since 1967.\16\
In originally adopting this requirement, the FDIC ``intended to address
practices such as the addition of nominal co-owners to an account
solely to increase deposit insurance coverage.'' \17\ The NCUA
thereafter adopted a substantially similar requirement \18\ and views
it as a reliable indicator of account ownership and important to
ensuring consistency with the FCU Act, which expressly limits the net
amount of share insurance payable to any member, or person with funds
lawfully held in a member account, based on the member account
classifications prescribed by the Board.\19\
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\15\ 36 FR 2477 (Feb. 5, 1971).
\16\ See 32 FR 10408, 10409 (July 14, 1967).
\17\ 84 FR 35022, 35023 (July 22, 2019).
\18\ The FCU Act generally requires that the NCUA determine
``the net amount of share insurance payable . . . in accordance with
this paragraph, and consistently with actions taken by the Federal
Deposit Insurance Corporation under section 1821(a) of this title.''
12 U.S.C. 1787(k)(1)(A) (emphasis added).
\19\ 12 U.S.C. 1787(k)(1).
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Neither the FCU Act nor the NCUA's regulations define the terms
``membership card'' or ``account signature card.'' In implementing
Sec. 745.8, the NCUA has not required any particular format for a
membership card or account signature card. Therefore, the agency has
previously permitted FICUs to satisfy the requirement through various
forms of documentation used in their account opening processes. The
Board also wishes to reiterate that, consistent with the Electronic
Signatures in Global and National Commerce Act (E-Sign Act),\20\ the
signature requirement may be satisfied electronically. This has been
the NCUA's long-standing position.
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\20\ Public Law 106-229, codified at 15 U.S.C. 7001(a).
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B. Summary of Proposed Rule
The May 2020 proposed rule amended Sec. 745.8 to explicitly
provide for an alternative method to satisfy the signature card
requirement. The proposed rule specifically allowed the signature card
requirement to be satisfied by information contained in the account
records of the FICU establishing the co-ownership of the share account,
such as evidence that the FICU has issued a mechanism for accessing the
account to each co-owner or evidence of usage of the share account by
each co-owner. For example, under the proposal, the requirement could
be satisfied by evidence that a FICU has issued a debit card to each
co-owner of the account or evidence that each co-owner of the account
has conducted transactions using the share account. These examples,
however, were not intended to define the only forms of evidence of co-
ownership that could satisfy the signature requirement. To the
contrary, the evidence found in a FICU's account records could take
many other forms.
The proposed amendment mirrors a change made by the FDIC in 2019
for federally insured depository institutions.\21\ As noted in the
proposal, the Board believes that the change would better facilitate
the prompt payment of share insurance in the event of a FICU's failure
by explicitly providing alternative methods that the NCUA could use to
determine the owners of joint accounts, consistent with the NCUA's
statutory authority. In the proposal, the Board emphasized that this
proposed change was not in reaction to any observed current problem
with respect to identifying qualifying joint accounts at FICUs and
processing insurance payments timely. Rather, the Board issued the
proposed rule because it is important to maintain parity between the
nation's two Federal deposit/share insurance programs and to provide
credit union members with equal access to insurance coverage. The Board
proposed these regulatory changes with the belief that they will
promote further confidence in the credit union system and embody a
forward-looking approach that will explicitly permit the use of new and
innovative technologies and processes to meet the NCUA's policy
objectives.
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\21\ 84 FR 35022 (July 22, 2019).
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The proposed rule emphasized that the change would not introduce
any new requirements for an account to be insured as a joint account,
and would not reduce or affect insurance coverage for any account for
which the existing joint account requirements are satisfied. The
proposed rule simply would provide an alternative method to satisfy the
existing signature card requirement for share insurance coverage as a
qualifying joint account. Under the proposal, if each co-owner of a
joint account signs, or has previously signed, a membership card or
account signature card in accordance with the existing requirement and
the FICU can produce it, then the proposed alternative method would be
unnecessary. Assuming that the remaining qualifying joint account
requirement is satisfied--that is, both co-owners possess equal
withdrawal rights--and all other membership requirements are met,\22\
the account would be insured as a joint account. The proposal noted
that the change would apply to all FICUs and would not impose any
increased burden or new recordkeeping requirements for joint accounts.
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\22\ With limited exceptions, the FCU Act generally limits NCUA
share insurance coverage to ``member accounts.'' 12 U.S.C. 1752(5).
Despite this general limitation, the FCU Act and the NCUA's
regulations do allow a nonmember to become a joint owner with a
member on a joint account with right of survivorship. 12 U.S.C.
1759(a). The regulations provide that a nonmember's interest in such
accounts will be insured in the same manner as the member joint
owner's interest. 12 CFR 745.8(e).
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In the proposal, the Board also detailed the non-quantifiable
benefits to owners of joint accounts. By explicitly providing
alternative methods that the NCUA could use to determine the owners of
joint accounts, the proposed rule would further support a prompt share
insurance determination in the event of a FICU's failure, alleviating
delays in the recognition of account ownership and uncertainty
regarding the extent of share insurance coverage.
[[Page 11100]]
The Board concluded that these benefits would promote confidence in the
credit union system and NCUA-insured shares.
II. Final Rule
This final rule follows publication of the May 2020 proposed rule.
After carefully considering the comments and conducting further
analysis, the Board affirms its rationale for issuing the proposal and
is adopting the final rule as proposed, with one clarifying change.
Specifically, the Board is using alternative language to better convey
that the examples of evidence of co-ownership in the proposed
regulatory text do not define the only form of evidence that could
satisfy the signature requirement. Pursuant to a suggestion from a
commenter, the final rule revises proposed Sec. 745.8(c)(2) by
replacing ``such as'' with the phrase ``including, but not limited
to,'' before the word ``evidence.'' Section 745.8(c)(2) will now state
that the signature card requirement may be satisfied by information
contained in the account records of the federally insured credit union
establishing co-ownership of the share account, ``including, but not
limited to,'' evidence that the institution has issued a mechanism for
accessing the account to each co-owner or evidence of usage of the
share account by each co-owner. The Board finds that the phrase
suggested by the commenter carries the same meaning as wording in the
proposed rule and may eliminate any ambiguity that evidence in the
account records other than the examples provided may be sufficient to
establish joint ownership of a share account.
The Board also wishes to emphasize several key points made in the
proposed rule and further discussed in response to comments received on
the proposed rule.
First, the Board strongly emphasizes that this final rule only
affects a requirement in the NCUA's regulations that must be satisfied
for a share account to be separately insured as a joint account; it
does not affect any other legal requirements applicable to FICUs. FICUs
may, and likely will, for legal or other reasons, find it appropriate
or necessary to continue collecting customers' signatures.\23\ The
changes made by this final rule do not modify or affect any state law
requirements generally applicable to FICUs, including those that
necessitate the collection and maintenance of customers' signatures.
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\23\ See, e.g., 12 CFR part 701, appendix A, and corresponding
state law requirements for federally insured, state-chartered credit
unions.
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Second, this final rule also does not affect the general principles
contained in Sec. 745.2 of the NCUA's share insurance regulations
applicable in determining insurance of accounts.\24\ These general
principles applicable in determining insurance of accounts continue to
apply to all share accounts, including joint ownership accounts.
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\24\ 12 CFR 745.2.
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Finally, the Board believes it is important to reiterate that the
final rule does not introduce any new requirements for an account to be
insured as a joint account, and would not reduce or affect insurance
coverage for any account for which the existing joint account
requirements are satisfied. The final rule simply provides an
alternative method to satisfy the existing signature card requirement
for share insurance purposes. If each co-owner of a joint account
signs, or has previously signed, a membership card or account signature
card in accordance with the existing requirement and the FICU can
produce it, then the alternative method would be unnecessary. Assuming
that the remaining qualifying joint account requirement is satisfied--
that is, both co-owners possess equal withdrawal rights--and all other
membership requirements are met,\25\ the account would be insured as a
joint account. The final rule applies to all FICUs and does not impose
any increased burden or new recordkeeping requirements for joint
accounts.
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\25\ With limited exceptions, the FCU Act generally limits NCUA
share insurance coverage to ``member accounts.'' 12 U.S.C. 1752(5).
Despite this general limitation, the FCU Act and the NCUA's
regulations do allow a nonmember to become a joint owner with a
member on a joint account with right of survivorship. 12 U.S.C.
1759(a). The regulations provide that a nonmember's interest in such
accounts will be insured in the same manner as the member joint
owner's interest. 12 CFR 745.8(e).
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III. Legal Authority
The Board has issued this final rule pursuant to its authority
under the FCU Act. Under the FCU Act, the NCUA is the chartering and
supervisory authority for FCUs and the Federal supervisory authority
for FICUs.\26\ The FCU Act grants the NCUA a broad mandate to issue
regulations governing both FCUs and FICUs. Section 120 of the FCU Act
is a general grant of regulatory authority and authorizes the Board to
prescribe rules and regulations for the administration of the FCU
Act.\27\ Section 207 of the FCU Act is a specific grant of authority
over share insurance coverage, conservatorships, and liquidations.\28\
Section 209 of the FCU Act is a plenary grant of regulatory authority
to the NCUA to issue rules and regulations necessary or appropriate to
carry out its role as share insurer for all FICUs.\29\ Accordingly, the
FCU Act grants the Board broad rulemaking authority to ensure that the
credit union industry and the NCUSIF remain safe and sound.
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\26\ 12 U.S.C. 1752-1775.
\27\ 12 U.S.C. 1766(a).
\28\ 12 U.S.C. 1787(b)(1).
\29\ 12 U.S.C. 1789(a)(11).
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IV. Discussion of Public Comments Received on the Proposed Rule
A. The Public Comments, Generally
The NCUA received 11 comments on the proposed rule. All 11
commenters noted their support for the proposed rule. Rationale
commenters offered for supporting the rule included: A belief that the
proposed rule would provide increased flexibility and would maximize
the opportunity for legitimate joint account holders to receive the
proper share insurance coverage; recognition that the proposed rule
would facilitate the prompt payment of share insurance in the event of
a FICU's failure; and agreement with the proposed rule's assertion that
``it is important to maintain parity between the nation's two Federal
deposit/share insurance programs and to provide credit union members
with equal access to insurance coverage.'' Several commenters also
emphasized that the proposed change is especially important given the
challenges posed by COVID-19 and the resulting economic uncertainty.
While all 11 commenters supported the proposed rule, commenters did
provide a number of suggestions for improving the rule. As discussed
more thoroughly below, suggestions for improvement focused on two
areas: (1) The type of evidence the NCUA could look to for evidence of
co-ownership that would fulfill the signature card requirement; and (2)
clarifications regarding the applicability of state law. The NCUA also
received comments noting appreciation for the NCUA's longstanding
position that the signature requirement may be satisfied
electronically, consistent with the E-SIGN Act. Additionally, the NCUA
received one comment addressing co-owned revocable trust accounts. Co-
owned revocable trust accounts are outside the scope of this
rulemaking.
[[Page 11101]]
B. Discussion of Specific Comments on the Proposed Rule
1. Examples of Evidence of Joint Account Ownership
Several commenters asked the NCUA to consider including additional
examples of account information that may be used as evidence of co-
ownership. One of the commenters suggested two additional possible
examples: (1) Use of the account via a mobile banking application or
online access platform; and (2) a co-owner having agreed to receive
electronic statements via their email address. Another of these
commenters asked the NCUA to promptly provide additional examples
because, while they appreciate the agency not limiting the scope, they
felt it would be helpful to provide examples of what information can be
used as new technologies are developed and utilized by credit unions.
In asking the NCUA to consider adding additional examples to the
text of the regulation or its ``Official Staff Commentary,'' one
commenter suggested that the examples need to more concretely describe
the types of evidence that may be used. The commenter expressed concern
that the evidence described in the rule itself is somewhat vague and
that the examples in the proposed rule's preamble may be confusing. The
commenter said that, for example, the fact that an account holder has a
debit card issued for another person's use (e.g., a parent supplying a
card for their child to use) does not establish that the other person
is actually a co-owner of the account. The commenter noted that the
other party would simply be authorized to access the account, but would
not own the funds nor qualify for joint share insurance coverage.
Related to this example, the commenter acknowledged that Sec.
745.8(c)(1) states that ``the signature requirement does not apply to .
. . any accounts maintained by an agent,'' but felt that this may not
be explicit enough to avoid confusion.
The Board disagrees that additional or more concrete examples would
be beneficial or are necessary because, contrary to the commenters'
intentions, they could be viewed as limiting flexibility. The examples
provided in the proposed rule, and adopted in the final rule, are
neither intended to be all-inclusive nor dispositive. Instead, they are
merely intended to illustrate the types of evidence the NCUA may
consider when determining whether an account is co-owned and the
signature card requirement in place for coverage as a qualifying joint
account satisfied. The change is intended to provide the NCUA with the
maximum flexibility possible to evaluate a FICU's account records and
properly determine if an account is co-owned. When it is necessary for
the NCUA to evaluate alternative evidence to determine if an account is
co-owned, the NCUA will holistically evaluate all of the information in
a FICU's account records that properly aid it in making this
determination. In other words, the NCUA will not look at evidence, like
the issuance of a debit card to a minor, as de facto evidence of co-
ownership, but will use such evidence to help it accurately determine
the actual account ownership.
Relatedly, one commenter suggested revising the text of proposed
Sec. 745.8(c)(2) to better reflect the proposed rule's intention, as
noted in the preamble, that the examples of evidence of co-ownership
were not intended ``to define the only form of evidence'' \30\ that
would satisfy the signature requirement. The commenter suggested that,
to minimize the opportunity for confusion in the future, the NCUA
consider modifying proposed Sec. 745.8(c)(2) by replacing ``such as''
with the phrase ``including, but not limited to,'' before the word
``evidence.'' The commenter reasoned that this would make clear on the
face of the regulation that other evidence in the account records may
be sufficient to establish qualifying joint ownership of a share
account. As discussed in section II of this preamble, the Board agrees
that this language would help to eliminate ambiguity and reflects the
intent of the proposed rule. Accordingly, the Board has adopted it in
the final rule. Section 745.8(c)(2) will now state that the signature
card requirement may be satisfied by information contained in the
account records of the federally insured credit union establishing co-
ownership of the share account, ``including, but not limited to,''
evidence that the institution has issued a mechanism for accessing the
account to each co-owner or evidence of usage of the share account by
each co-owner.
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\30\ 85 FR 34454, 34546 (June 5, 2020).
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2. Applicability of State Law
One commenter provided a detailed comment asking the NCUA to add
language to the regulation or its ``Official Staff Commentary'' clearly
stating that the proposed change only addresses the evidence that the
NCUA may accept to treat an account as joint for share insurance
coverage purposes, with no bearing on the legality or enforceability of
an account that lacks joint account holders' signatures on an account
agreement. The Board addressed this issue in the preamble to the
proposed rule \31\ and again reiterates now that the alternative method
for satisfying the signature card requirement adopted in this final
rule is only relevant for purposes of determining share insurance
coverage. The final rule has no bearing on any other legal requirement
that FICUs are subject to, including all applicable state laws. The
final rule does not eliminate the need for FICUs to obtain signatures
when opening an account, it merely allows the NCUA to use alternative
evidence in a FICU's account records to find the signature card
requirement for coverage as a qualifying joint account satisfied even
if signed membership or account signature cards are absent from a
liquidated FICU's records.
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\31\ ``The proposed rule only would affect a requirement in the
NCUA's regulations that must be satisfied for a share account to be
separately insured as a joint account; it would not affect any other
legal requirements applicable to FICUs. FICUs may, for legal or
other reasons, find it appropriate or necessary to continue
collecting customers' signatures. The changes made by the proposed
rule would not modify or affect any state law requirements generally
applicable to FICUs.'' 85 FR 34454, 34546-47 (June 5, 2020)
(emphasis added).
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In addressing this issue, the commenter acknowledged that the
preamble to the proposed rule speaks to this issue,\32\ but felt it
critical that FICUs understand that the proposed rule: (1) Would only
impact share insurance coverage; and (2) would not eliminate any
requirement under state law or contracts common law related to the need
for joint account holders to sign account agreements. The commenter
correctly emphasized that the proposed change would not open the door
for FICUs to establish accounts without proper, signed agreements in
place among all account holders.
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\32\ Id.
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The commenter noted that signatures are statutorily required in
their state to create a joint account and that, even absent a statutory
requirement, the common law calls for contracts to be signed. The
commenter stated that without the signatures of all joint account
holders to a contract or account agreement, credit unions lack a legal
basis for enforcing the account's terms against those account holders.
The commenter emphasized that the lack of a legally enforceable, signed
joint account agreement could lead to credit unions being caught in the
middle of potential disputes among parties and their heirs when one or
more account holders die.
While the Board again reiterates the alternative method for
satisfying the signature card requirement adopted in
[[Page 11102]]
this final rule is only relevant for purposes of determining share
insurance coverage, it declines to add additional language to the text
of the regulation explicitly stating that credit unions are still
subject to other applicable legal requirements. The Board appreciates
the commenter's concern, but does not believe it appropriate or
necessary to include such language. The Board believes it is clear in
the text of the regulation that the alternative method is only relevant
for evaluating whether the signature card requirement is satisfied for
purposes of determining proper share insurance coverage. Further, the
Board thinks it inappropriate to explicitly state in a regulation that
the regulation does not preempt other applicable law or apply to
subjects outside the scope of the regulation when there is no
indication the provision intends to preempt other laws or apply in
other contexts. Inclusion of such language would only increase
confusion and raise doubts about provisions that do not contain similar
language.
VI. Regulatory Procedures
A. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires that, in
connection with a final rule, an agency prepare a final regulatory
flexibility analysis that describes the impact of a rule on small
entities. A regulatory flexibility analysis is not required, however,
if the agency certifies that the rule will not have a significant
economic impact on a substantial number of small entities (defined for
purposes of the RFA to include FICUs with assets less than $100
million) and publishes its certification and a short, explanatory
statement in the Federal Register together with the rule. The final
rule explicitly allows the NCUA to look to information contained in the
account records of a FICU in order to satisfy the signature card
requirement at the time of a FICU's failure. As a result, it will not
cause any increased burden on FICUs and will not have an impact on
small credit unions. Accordingly, the NCUA certifies that the final
rule will not have a significant economic impact on a substantial
number of small credit unions.
B. Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (PRA) applies to rulemakings in
which an agency creates new or amends existing information collection
requirements.\33\ For the purpose of the PRA, an information collection
requirement may take the form of a reporting, recordkeeping, or a
third-party disclosure requirement. The final rule does not contain
information collection requirements that require approval by OMB under
the PRA.\34\ The final rule will merely allow the NCUA to look to
information contained in the account records of a FICU in order to
satisfy the signature card requirement at the time of a FICU's failure.
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\33\ 44 U.S.C. 3507(d); 5 CFR part 1320.
\34\ 44 U.S.C. Chap. 35.
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C. Executive Order 13132
Executive Order 13132 encourages independent regulatory agencies to
consider the impact of their actions on state and local interests. In
adherence to fundamental federalism principles, the NCUA, an
independent regulatory agency as defined in 44 U.S.C. 3502(5),
voluntarily complies with the Executive order. This rulemaking will not
have a substantial direct effect on the states, on the connection
between the National Government and the states, or on the distribution
of power and responsibilities among the various levels of government.
The NCUA has determined that this final rule does not constitute a
policy that has federalism implications for purposes of the Executive
order.
D. Assessment of Federal Regulations and Policies on Families
The NCUA has determined that this final rule will not affect family
well-being within the meaning of Section 654 of the Treasury and
General Government Appropriations Act, 1999.\35\
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\35\ Public Law 105-277, 112 Stat. 2681 (1998).
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E. Small Business Regulatory Enforcement Fairness Act
The Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA) generally provides for congressional review of agency rules. A
reporting requirement is triggered in instances where the NCUA issues a
final rule as defined by section 551 of the Administrative Procedure
Act. An agency rule, in addition to being subject to congressional
oversight, may also be subject to a delayed effective date if the rule
is a ``major rule.'' The NCUA does not believe this rule is a ``major
rule'' within the meaning of the relevant sections of SBREFA. As
required by SBREFA, the NCUA will submit this final rule to the Office
of Management and Budget for it to determine if the final rule is a
``major rule'' for purposes of SBREFA. The NCUA also will file
appropriate reports with Congress and the Government Accountability
Office so this rule may be reviewed.
List of Subjects in 12 CFR Part 745
Credit, Credit unions, Share insurance.
By the National Credit Union Administration Board on February
18, 2021.
Melane Conyers-Ausbrooks,
Secretary of the Board.
For the reasons discussed in the preamble, the Board amends 12 CFR
part 745 as follows:
PART 745--SHARE INSURANCE AND APPENDIX
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1. The authority citation for part 745 continues to read as follows:
Authority: 12 U.S.C. 1752(5), 1757, 1765, 1766, 1781, 1782,
1787, 1789; title V, Pub. L. 109-351;120 Stat. 1966.
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2. Revise Sec. 745.8(c) to read as follows:
Sec. 745.8 Joint ownership accounts
* * * * *
(c) Qualifying joint accounts. (1) A joint account is a qualifying
joint account if each of the co-owners has personally signed a
membership or account signature card and has a right of withdrawal on
the same basis as the other co-owners. The signature requirement does
not apply to share certificates, or to any accounts maintained by an
agent, nominee, guardian, custodian or conservator on behalf of two or
more persons if the records of the credit union properly reflect that
the account is so maintained.
(2) The signature card requirement of paragraph (c)(1) of this
section also may be satisfied by information contained in the account
records of the federally insured credit union establishing co-ownership
of the share account, including, but not limited to, evidence that the
institution has issued a mechanism for accessing the account to each
co-owner or evidence of usage of the share account by each co-owner.
* * * * *
[FR Doc. 2021-03671 Filed 2-23-21; 8:45 am]
BILLING CODE 7535-01-P
