Newsroom

December 12, 2014

NAFCU-backed IOLTA bill through Senate, awaits signature

The NAFCU-supported H.R. 3468, the "Credit Union Share Insurance Fund Parity Act," aimed at giving credit unions parity with banks on escrow accounts such as Interest on Lawyer Trust Accounts was cleared by the Senate Thursday and awaits the signature of President Obama.

NAFCU President and CEO Dan Berger hailed the Senate's action. "This critical legislation is an important win for credit unions, and we thank the bill's House sponsors, Reps. Ed Perlmutter, D-Colo., and Ed Royce, R-Calif., as well as Sens. Angus King, I-Maine, and Mark Warner, D-Va., for bringing the bill to the Senate," Berger said. "This has been a key point of NAFCU's five-point plan for regulatory relief, and we hope for more relief to come."

Once signed, the Perlmutter-Royce measure will ensure that federally insured credit unions have parity with FDIC-insured institutions with respect to escrow accounts such as IOLTAs, advancing a key aspect of NAFCU's five-point plan for regulatory relief for credit unions.

H.R. 3468 "strengthens national credit unions' commitment to IOLTAs and the legal services they help fund for local communities," Royce said in a statement. "The universal support for this bill in both chambers of Congress speaks to the merits of establishingparity for the treatment of IOLTAs and other similar accounts regardless of whether they are kept at a bank or a credit union."

"Prior to being elected to Congress, I practiced law for 30 years and in that time I established many Lawyer Trust Accounts for clients. This legislation is critical to ensuring an IOLTA's full value in light of any potential credit union failure," said Perlmutter. "More importantly, the interest earned on Lawyer Trust Accounts goes to grants improving access to civil justice and legal services for the poor."