reglab/statecodes huggingface dataset:
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter B. Administration › Section 122.056. Honorary or Advisory Directors

Sec. 122.056.  HONORARY OR ADVISORY DIRECTORS.  (a)  The board may appoint not more than six individuals to serve at the board's pleasure as honorary or advisory directors to advise and consult with the board and otherwise aid the board in carrying out the board's duties and responsibilities.
(b)  An honorary or advisory director:
(1)  need not be eligible for membership in the credit union;
(2)  is not a member of the board;  and
(3)  is not entitled to vote on a matter before the board.
(c)  An honorary or advisory director may participate in any board deliberation.  Except as otherwise provided by Section 125.402(d), an honorary or advisory director shall hold in confidence all information the director receives about a credit union during the director's service.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 19 (S.B. 244), Sec. 9, eff. September 1, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter B. Administration › Section 122.057. Officers; Executive Committee

Sec. 122.057.  OFFICERS;  EXECUTIVE COMMITTEE.  (a)  At the annual organizational meeting, the board shall elect from its membership a chairman, vice chairman, treasurer, and secretary.  The offices of treasurer and secretary may be held by the same individual.
(b)  An officer elected under Subsection (a):
(1)  serves a one-year term or until the officer's successor is elected and qualified;  and
(2)  has the duties the bylaws prescribe.
(c)  The board may appoint from its membership an executive committee of at least three persons to exercise, between board meetings, authority specifically delegated by the board under conditions specified by the board.  At each board meeting, the executive committee shall report to the board regarding any meeting held or action taken by the committee between board meetings.
(d)  The bylaws may establish a minimum age requirement to hold office in the credit union.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 19, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter B. Administration › Section 122.058. Chief Executive Officer

Sec. 122.058.  CHIEF EXECUTIVE OFFICER.  (a)  The board may employ, elect, or appoint a president, who is the chief executive officer in charge of operations.
(b)  The president may be a board member but may not be chairman, vice chairman, or secretary of the credit union.  The president serves at the board's pleasure.
(c)  Subject to board guidelines, the president shall appoint or employ, and may discharge, any other officer or employee the president considers necessary to operate the credit union.  The president shall prescribe the title of an officer or employee appointed or employed under this subsection.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter B. Administration › Section 122.059. Delegation of Management and Loan Approval Authority

Sec. 122.059.  DELEGATION OF MANAGEMENT AND LOAN APPROVAL AUTHORITY.  (a)  Without written approval of the commissioner, a credit union may not:
(1)  contract with an individual who is not an officer, director, or employee of the credit union or with an organization for the provision of the management of the credit union;  or
(2)  delegate to an individual who is not an officer, director, or employee of the credit union or to an organization the authority to manage the credit union.
(b)  The board may delegate all or part of its power to approve or disapprove a loan to a credit committee, one or more other committees, or one or more individuals.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 20, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter B. Administration › Section 122.060. Certificate of Election

Sec. 122.060.  CERTIFICATE OF ELECTION.
(a)  A credit union shall submit to the commissioner, in a form approved by the department, a certificate of election that provides the name and address of each officer, director, and committee member elected or appointed.  The certificate must be filed within the time prescribed by the commissioner.
(b)  The commission by rule may authorize the commissioner to obtain other confidential reports relating to a newly elected or appointed officer, director, or committee member.
(c)  The commissioner may accept a form prescribed by an insuring organization that contains substantially similar information as the certificate of election in lieu of the certificate.  The acceptance of such a form does not limit the commissioner's power to require additional information concerning a newly elected or appointed officer, director, or committee member.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 21, eff. Sept. 1, 2003.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 19 (S.B. 244), Sec. 10, eff. September 1, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter B. Administration › Section 122.061. Conflicts of Interest

Sec. 122.061.  CONFLICTS OF INTEREST.  (a)  While serving as a director, honorary director, advisory director, committee member, officer, or employee of a credit union, a person may not:
(1)  participate, directly or indirectly, in the deliberation on or determination of a question affecting the person's pecuniary interest or the pecuniary interest of a member of the person's immediate family or of a partnership, association, or corporation, other than the credit union, in which the person is directly or indirectly interested; or
(2)  become employed by, engage in, or own an interest in a business or professional activity that the person could reasonably expect to:
(A)  require or induce the person to disclose confidential information acquired because of the person's office or employment in the credit union; or
(B)  impair the person's independence or judgment in the performance of the person's duties or responsibilities to the credit union.
(b)  An interest only as a member of the credit union that is shared in common with all other members is not a pecuniary interest within the meaning of Subsection (a)(1).
(c)  In this section, "member of a person's immediate family" means a person's spouse or another person living in the person's household.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 19 (S.B. 244), Sec. 11, eff. September 1, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter B. Administration › Section 122.062. Compensation

Sec. 122.062.  COMPENSATION.  A person may not receive compensation for serving as a director, honorary director, advisory director, or committee member of a credit union, except that the person may be:
(1)  provided with reasonable health, life, accident, liability, or similar insurance protection;
(2)  reimbursed for necessary expenses incurred in the performance of the person's duties;  and
(3)  paid the fees and reimbursed for other expenditures authorized by commission rules.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter B. Administration › Section 122.063. Bond

Sec. 122.063.  BOND.  The board shall purchase from a surety company authorized to do business in this state a blanket surety or security bond covering each director, honorary director, advisory director, officer, employee, member of an official committee, attorney, or other agent of the credit union as required by commission rule.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter B. Administration › Section 122.064. Indemnification

Sec. 122.064.  INDEMNIFICATION.  A credit union may elect to indemnify a director, officer, employee, or agent of the credit union and to purchase insurance as if the credit union were an "enterprise" as defined by Section 8.001, Business Organizations Code, under and subject to the credit union's bylaws and written policy.  A credit union may not provide any indemnification or insurance that would not be permissible under Chapter 8, Business Organizations Code, but may elect to impose the credit union's own limitations on indemnification.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 19 (S.B. 244), Sec. 12, eff. September 1, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter C. Operations and Finances › Section 122.101. Call Reports

Sec. 122.101.  CALL REPORTS.  (a)  A credit union shall prepare a quarterly call report, in a manner approved by the department, that states the credit union's financial condition.  The commissioner may require a credit union to file additional financial reports.
(b)  The credit union must submit the call report on or before the due date prescribed by the department.  If a credit union does not submit a report by the due date, the commissioner shall charge a late fee in an amount set by the commission for each day the report remains unfiled.  The commissioner for good cause shown may waive all or part of the late fee.
(c)  A credit union that does not file a report on or before the date it is due is subject to sanctions provided by this chapter and Chapter 126.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 157, Sec. 9, eff. Sept. 1, 1999;  Acts 2003, 78th Leg., ch. 533, Sec. 22, eff. Sept. 1, 2003.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 19 (S.B. 244), Sec. 13, eff. September 1, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter C. Operations and Finances › Section 122.102. Financial Reporting; Audits

Sec. 122.102.  FINANCIAL REPORTING;  AUDITS.  (a)  A credit union shall use the financial reporting forms and observe the accounting principles prescribed by the commission.
(b)  The board shall:
(1)  make a comprehensive annual audit of the credit union's books and affairs, in accordance with established principles and commission rules;
(2)  submit a summary of the audit report to the credit union's members at the next annual meeting;  and
(3)  make a supplementary audit or examination as the board considers necessary or the commissioner requires.
(c)  The commission by rule may require a verification of members' accounts with the credit union's records.
(d)  If the commissioner, by examination or other credible evidence, finds that the board is not complying with this section or a rule adopted under this section, the commissioner may appoint an independent person from outside the credit union and its members to perform an audit.  The credit union shall pay the cost of the audit.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter C. Operations and Finances › Section 122.103. Equity Capital

Sec. 122.103.  EQUITY CAPITAL.  A credit union's equity capital consists of:
(1)  retained earnings;
(2)  appropriated retained earnings, including net worth and other reserves;
(3)  undivided earnings;  and
(4)  other forms of capital in accordance with generally accepted accounting principles and approved by the commissioner.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 23, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter C. Operations and Finances › Section 122.104. Net Worth Reserve Allocations

Sec. 122.104.  NET WORTH RESERVE ALLOCATIONS.  (a)  The commission by rule shall require a credit union to contribute to and maintain net worth reserves necessary to protect the interests of its members.  The rule may:
(1)  prescribe the purposes for which the net worth reserves may be used;  and
(2)  authorize the commissioner to approve other uses.
(b)  The credit union's board may establish reserves in addition to the required net worth reserves.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 24, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter C. Operations and Finances › Section 122.105. Membership Share Reduction

Sec. 122.105.  MEMBERSHIP SHARE REDUCTION.  A credit union may order a reduction in the membership shares of each of its shareholders if:
(1)  the credit union's losses resulting from a depreciation in value of its loans or investments or otherwise exceed its undivided earnings and its reserves, and the estimated value of its assets is less than the total amount due the shareholders;
(2)  a majority vote of the credit union's members present at a meeting of members called for that purpose approve the reduction;  and
(3)  the reduction divides the loss proportionately among the shareholders.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 25, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter C. Operations and Finances › Section 122.106. Exemption From Certain Taxes

Sec. 122.106.  EXEMPTION FROM CERTAIN TAXES.  (a)  Except as provided by Subsection (b), a credit union is exempt from a franchise or other license tax.
(b)  A credit union is not exempt from the franchise tax imposed by Chapter 171, Tax Code, unless the credit union is exempted by that chapter.
(c)  The intangible property of a credit union organized under this chapter is not taxable.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter C. Operations and Finances › Section 122.107. Notice of Availability of Certain Documents

Sec. 122.107.  NOTICE OF AVAILABILITY OF CERTAIN DOCUMENTS.  (a)  A credit union regulated under this subtitle and Chapter 15 shall give notice to the credit union's members of the availability on request of a member of documents related to the credit union's finances and management, including:
(1)  a summary of the most recent annual audit;
(2)  the most recent statement of financial condition, such as nonconfidential pages of the quarterly call report provided under Section 122.101;
(3)  a copy of IRS Form 990 or its successor; and
(4)  any other documents that members are entitled to possess, as determined by the commission.
(b)  The notice required by Subsection (a) must be given:
(1)  on the credit union's Internet website if the credit union maintains a website; and
(2)  in a newsletter twice a year if the credit union distributes a newsletter.
(c)  The commission shall adopt reasonable rules to implement this section, including rules prescribing an alternative method for credit unions that do not maintain an Internet website or distribute a newsletter to provide their members with notice of the documents required by Subsection (a).
Added by Acts 2009, 81st Leg., R.S., Ch. 695 (H.B. 2735), Sec. 17, eff. September 1, 2009.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter D. Merger or Consolidation › Section 122.151. Authority to Merge or Consolidate

Sec. 122.151.  AUTHORITY TO MERGE OR CONSOLIDATE.  (a)  A credit union may merge or consolidate with another credit union, under the other credit union's existing articles of incorporation or otherwise, if:
(1)  the merger or consolidation is in accordance with commission rules and approved by the commissioner;  and
(2)  the merger or consolidation takes place under a plan that has been:
(A)  agreed to by a majority of the board of each credit union joining in the merger or consolidation;  and
(B)  approved by a majority of the members of each credit union voting at a meeting of its members called for that purpose.
(b)  The commissioner may waive the requirement that the members of each credit union approve the plan.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter D. Merger or Consolidation › Section 122.152. Application to Merge or Consolidate

Sec. 122.152.  APPLICATION TO MERGE OR CONSOLIDATE.  (a)  After agreement by the directors and approval by the members, if applicable, of each credit union or federal credit union, the chairman and secretary of each credit union or federal credit union shall execute a certificate of merger or consolidation that:
(1)  includes a copy of the resolution or other action by which the board agreed to the merger or consolidation plan;  and
(2)  states:
(A)  the time and place of the board meeting at which the board agreed to the merger or consolidation plan;
(B)  the board's vote for and against adoption of the plan;
(C)  the time and place of the meeting at which the members approved the plan, if applicable;
(D)  the membership's vote for and against approval of the plan, if applicable;  and
(E)  the name of the surviving credit union.
(b)  The merging credit union or a consolidating credit union shall submit the certificates and a copy of the merger or consolidation plan to the commissioner.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 26, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter D. Merger or Consolidation › Section 122.153. Decision by Commissioner; Appeal

Sec. 122.153.  DECISION BY COMMISSIONER;  APPEAL.  (a)  Subject to Subsection (b), on approving the merger or consolidation, the commissioner shall return the certificates and plan to the merging or consolidating credit unions.
(b)  The commissioner may conditionally approve a merger or consolidation.  If approval is conditional, the commissioner:
(1)  shall state the condition in the order approving the merger or consolidation;  and
(2)  may not deliver the approved certificate until the condition has been met.
(c)  Notwithstanding any other law, the commissioner may authorize a credit union that is insolvent or is in danger of insolvency to merge or consolidate with another credit union or may authorize a credit union to purchase any of the assets of, or assume any of the liabilities of, another credit union that is insolvent or in danger of insolvency if the commissioner is satisfied that:
(1)  an emergency requiring expeditious action exists with respect to the credit union that is insolvent or in danger of insolvency;
(2)  another option is not reasonably available;  and
(3)  the public interest would best be served by approval of the merger, consolidation, purchase, or assumption.
(d)  If the commissioner disapproves the merger or consolidation or imposes a condition, the merging or consolidating credit unions may appeal the commissioner's decision to the commission in the manner provided by Section 122.007 for an appeal on an application to incorporate a credit union.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter D. Merger or Consolidation › Section 122.1531. Considerations in Determination

Sec. 122.1531.  CONSIDERATIONS IN DETERMINATION.  In determining whether to approve or disapprove the merger or consolidation, the commissioner shall consider the availability and adequacy of financial services in the local community and the effect that the merger or consolidation would have on the local community.  The commission by rule shall establish other appropriate criteria that the commissioner must consider in making the determination.
Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.03(a), eff. Sept. 1, 1999.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter D. Merger or Consolidation › Section 122.154. Property, Obligations, and Liabilities of Merged or Consolidated Credit Union

Sec. 122.154.  PROPERTY, OBLIGATIONS, AND LIABILITIES OF MERGED OR CONSOLIDATED CREDIT UNION.  After a merger or consolidation is effected:
(1)  the property of the merged or consolidated credit union vests in the surviving credit union without an instrument of transfer or endorsement;  and
(2)  the obligations and liabilities of the merged or consolidated credit union are assumed by the surviving credit union.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter D. Merger or Consolidation › Section 122.155. Construction of Subchapter

Sec. 122.155.  CONSTRUCTION OF SUBCHAPTER.  This subchapter shall be construed, when possible, to permit a credit union authorized to do business in this state under other law to merge or consolidate with a credit union authorized to do business under this subtitle.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter D. Merger or Consolidation › Section 122.156. Rules to Address Certain Procedures

Sec. 122.156.  RULES TO ADDRESS CERTAIN PROCEDURES.  The rules adopted under this subchapter must specify in detail the procedures that:
(1)  a credit union must follow to obtain commissioner approval of a merger or consolidation;  and
(2)  the commissioner must follow in approving or disapproving the merger or consolidation.
Added by Acts 1999, 76th Leg., ch. 62, Sec. 7.03(a), eff. Sept. 1, 1999.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter E. Conversion › Section 122.201. Conversion of State Credit Union to Federal Credit Union

Sec. 122.201.  CONVERSION OF STATE CREDIT UNION TO FEDERAL CREDIT UNION.  (a)  A credit union organized under the laws of this state may convert to a credit union under the laws of the United States:
(1)  on an affirmative vote by a majority of the members voting at a meeting called for that purpose; and
(2)  by complying with any rule adopted by the commission to facilitate the conversion.
(b)  On the issuance of a charter by the National Credit Union Administration, the credit union:
(1)  ceases to be a credit union incorporated under this subtitle; and
(2)  is no longer subject to the supervision and regulation of the commissioner and department.
(c)  The converted credit union shall file with the commissioner a copy of the charter issued to the credit union by the National Credit Union Administration.  Failure to file the required copy of the charter does not affect the validity of the conversion.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 19 (S.B. 244), Sec. 14, eff. September 1, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter E. Conversion › Section 122.202. Conversion of State Credit Union to Out-of-State Credit Union

Sec. 122.202.  CONVERSION OF STATE CREDIT UNION TO OUT-OF-STATE CREDIT UNION.  A credit union organized under the laws of this state may convert to a credit union under the laws of another state:
(1)  on an affirmative vote by a majority of the members voting at a meeting called for that purpose;  and
(2)  by complying with any applicable commission rule.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter E. Conversion › Section 122.203. Conversion of Federal or Out-of-State Credit Union to State Credit Union

Sec. 122.203.  CONVERSION OF FEDERAL OR OUT-OF-STATE CREDIT UNION TO STATE CREDIT UNION.  A credit union organized under the laws of the United States or of another state may convert to a credit union organized under the laws of this state by complying with:
(1)  the requirements of the jurisdiction under which the converting credit union is organized;  and
(2)  commission rules.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.251. Defamation

Sec. 122.251.  DEFAMATION.  (a)  A person commits an offense if the person knowingly:
(1)  makes, circulates, or transmits to another person a false statement that is derogatory to the financial condition of a credit union with the intent to injure that credit union;  or
(2)  counsels, aids, procures, or induces another person to make, circulate, or transmit a false statement that is derogatory to the financial condition of a credit union with the intent to injure that credit union.
(b)  An offense under this section is a third degree felony.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.252. Consideration for Loan, Investment, or Purchase

Sec. 122.252.  CONSIDERATION FOR LOAN, INVESTMENT, OR PURCHASE.  (a)  A person commits an offense if the person:
(1)  is a director, honorary director, advisory director, committee member, officer, or employee of a credit union;  and
(2)  knowingly demands or receives, directly or indirectly, consideration for the credit union's making a specific loan or investment or purchasing an asset.
(b)  An offense under this section is a Class A misdemeanor.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.253. Loan to Nonmember

Sec. 122.253.  LOAN TO NONMEMBER.  (a)  A person commits an offense if the person:
(1)  is a director, honorary director, advisory director, committee member, officer, or employee of a credit union;  and
(2)  knowingly permits a loan to be made to a nonmember or participates in a loan to a nonmember.
(b)  An offense under this section is a Class B misdemeanor.
(c)  A person who commits an offense described by Subsection (a) is primarily liable to the credit union for the amount illegally loaned.  The illegality of the loan is not a defense in an action by the credit union to recover on the loan.
(d)  Extending credit to a nonmember as a comaker with a member or extending credit to a nonmember for the sale of property owned by the credit union or for the sale of assets acquired in liquidation or repossession is authorized and is not a loan to a nonmember.  Acquiring a promissory note or other asset by a share and deposit guaranty corporation or credit union authorized under Section 15.410, on which a nonmember is liable, is not a loan to a nonmember.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.254. False Statements or Documents; Destruction of Records

Sec. 122.254.  FALSE STATEMENTS OR DOCUMENTS;  DESTRUCTION OF RECORDS.  (a)  A person commits an offense if the person, knowingly and with the intent to deceive:
(1)  makes a false entry on a record, report, or statement of a credit union;  or
(2)  in connection with an examination or investigation of a credit union by the commissioner, a deputy commissioner, or the department's authorized examiner, exhibits a false paper, instrument, or security or gives under oath a false answer to a question directly related to the examination or investigation asked the person by the commissioner, the deputy commissioner, or the department's authorized examiner.
(b)  A person commits an offense if the person knowingly removes, destroys, or conceals a record of the credit union for the purpose of concealing a fact or information from the commissioner, a deputy commissioner, or the department's authorized examiner.
(c)  An offense under this section is a third degree felony.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.255. Determination of Misconduct

Sec. 122.255.  DETERMINATION OF MISCONDUCT.  The commissioner may determine that an officer, director, honorary director, advisory director, or employee of a credit union, or the credit union itself, acting by and through an officer, director, honorary director, advisory director, or employee, has:
(1)  violated this subtitle, a rule adopted under this subtitle, or another law applicable to a credit union;
(2)  violated or refused to comply with a final order of the commissioner or commission;
(3)  wilfully neglected to perform an official or legal duty or wilfully committed a breach of trust or fiduciary duty;
(4)  committed a fraudulent or questionable practice in the conduct of the credit union's business that endangers the credit union's reputation or threatens its solvency;
(5)  refused to submit to examination under oath or to permit examination of the credit union's records and affairs by the commissioner or the commissioner's representative;
(6)  failed or refused to authorize and direct another person to permit the commissioner or the commissioner's representative to examine the credit union's records in the other person's custody after the commissioner has requested the authorization of and direction to the other person;
(7)  conducted the credit union's business in an unsafe, unauthorized, or unlawful manner;
(8)  concealed, destroyed, removed, or falsified a record related to the credit union's business and affairs;
(9)  transacted business while the credit union was in an unsafe or unsound condition;
(10)  violated a condition of the credit union's articles of incorporation or of a written agreement with the commissioner or the commission;  or
(11)  committed a criminal act that is a substantial detriment to the reputation and conduct of the credit union's business.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 27, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.256. Determination Letter; Board Meeting

Sec. 122.256.  DETERMINATION LETTER;  BOARD MEETING.  (a)  If the commissioner determines from examination or other credible evidence that a credit union is in a condition that may warrant the issuance of an order under this chapter or Chapter 126, the commissioner may notify the credit union in writing of the commissioner's determination, the requirements the credit union must satisfy to abate the determination, and the time by which the requirements must be satisfied to avert further administrative action.  The determination letter must be delivered in person or sent by registered or certified mail, return receipt requested.
(b)  If considered necessary, the commissioner may call a meeting of the credit union's board.  The directors shall attend the meeting.  The commissioner shall present to the board the findings stated in the determination letter and shall demand the discontinuance of any violation or unsafe or unsound practice found.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 28, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.257. Cease and Desist Order for Credit Unions

Sec. 122.257.  CEASE AND DESIST ORDER FOR CREDIT UNIONS.  (a)  If the commissioner makes a finding listed in Section 122.255 and determines that an order to cease and desist is necessary and in the best interest of the credit union involved and its depositors, creditors, and members, the commissioner may serve on the credit union, its board, and each offending person an order to cease and desist from a violation or practice specified in the order and to take affirmative action that the commissioner considers necessary to correct a condition resulting from a violation or unsafe or unsound practice found.
(b)  The order must:
(1)  be in writing;
(2)  be served:
(A)  at the meeting called under Section 122.256 or not later than the 30th day after the date of that meeting;  and
(B)  by certified or registered mail, addressed to the credit union at the last address of its principal office as shown by department records, or by delivery to an officer or director of the credit union;  and
(3)  unless the order is effective immediately on service as provided by Subsection (d), state the effective date of the order, which may not be before the 10th day after the date the order is served.
(c)  Service by mail is complete on deposit of the paper, enclosed in a postpaid, properly addressed wrapper, in a post office or official depository under the care and custody of the United States Postal Service.
(d)  A cease and desist order is effective immediately on service if the commissioner finds that:
(1)  the solvency of the credit union is endangered;
(2)  there is a continuing violation of this subtitle  or a rule adopted under this subtitle;  or
(3)  there is a threat of immediate and irreparable harm to the public or the credit union or its depositors, creditors, or members.
(e)  The order is final unless, not later than the 10th day after the date the order is served, the credit union files with the commissioner written notice of appeal that includes a certified copy of the board resolution.
(f)  A copy of the order shall be entered in the minutes of the board meeting.  The directors shall certify to the commissioner in writing that each director has read the order.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 29, eff. Sept. 1, 2003.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 695 (H.B. 2735), Sec. 18, eff. September 1, 2009.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.2575. Cease and Desist Order for Other Persons

Sec. 122.2575.  CEASE AND DESIST ORDER FOR OTHER PERSONS.  (a)  If it appears to the commissioner that a person who is not authorized to engage in business under this subtitle or the Federal Credit Union Act (12 U.S.C. Section 1751 et seq.) is violating this subtitle, a rule adopted under this subtitle, or another state statute or rule relating to the regulation of credit unions, the commissioner may issue without notice and hearing an order to cease and desist from continuing a particular action to enforce compliance with the applicable state statute or rule relating to the regulation of credit unions.  The order must contain a reasonably detailed statement of the fact on which the order is made.
(b)  If a person against whom an order under this section is made requests a hearing, the commissioner shall set and give notice of a hearing before the commissioner or a hearings officer.  The hearing shall be governed by Chapter 2001, Government Code.
(c)  An order under this section becomes final unless the person to whom the order is issued requests a hearing not later than the 30th day after the date the order is issued.  If a hearing has not been requested not later than the 30th day after the date the order is made, the order is considered final and nonappealable.
Added by Acts 2009, 81st Leg., R.S., Ch. 695 (H.B. 2735), Sec. 19, eff. September 1, 2009.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.258. Removal Order

Sec. 122.258.  REMOVAL ORDER.  (a)  The commissioner by order may remove or prohibit a person who is a current or former officer, director, manager, or employee of a credit union from office, employment, or further participation in the affairs of a credit union if the commissioner by examination or other credible evidence:
(1)  finds that:
(A)  the person has continued a violation or practice previously charged and found by the commissioner after issuance of a determination letter under Section 122.256 or a cease and desist order under Section 122.257;  and
(B)  removal or prohibition is necessary and in the best interest of the credit union and its depositors, creditors, and members;  or
(2)  makes a finding listed in Section 122.255 and determines that removal or prohibition of the person is immediately necessary because the person has committed or is about to commit:
(A)  a fraudulent or criminal act involving the conduct of the business of the credit union;
(B)  an act that may cause the credit union to become insolvent or to be placed in imminent danger of insolvency;  or
(C)  an act that otherwise threatens immediate and irreparable harm to the public or the credit union or its members, depositors, or creditors.
(b)  The removal order must:
(1)  state with reasonable certainty the grounds for removal;  and
(2)  be promptly served on the person removed and on the credit union in the manner provided by Section 122.257 for service of a cease and desist order.
(c)  On issuance of the order, the person has no right, duty, or authority of office or employment in the credit union.  After the order becomes final, the person removed or prohibited may not hold office in, be employed by, or participate in the affairs of any credit union without the prior written approval of the commissioner.  The order is final as of the date of issuance unless the person removed or prohibited or the credit union, as evidenced by a certified copy of the board resolution, files written notice of appeal with the commissioner not later than the 10th day after the day the removal order is served.
(d)  A copy of the removal order shall be entered in the board minutes.  An officer shall acknowledge receipt of the order and certify to the commissioner that each person named in the removal order has been removed from office or employment.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 30, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.259. Hearing on Appeal of Proposed Order

Sec. 122.259.  HEARING ON APPEAL OF PROPOSED ORDER.  (a)  If the credit union or a person removed from office or employment files a notice of appeal of a cease and desist order or a removal order, the commissioner shall set a time and place for the commission to hear the appeal in accordance with commission rules.
(b)  The filing of an appeal does not suspend a removal order or cease and desist order.
(c)  At the conclusion of the hearing, the commission may vacate, affirm, or modify the commissioner's order and may order that appropriate action be taken.
(d)  A cease and desist order or a removal order is final on completion of an appeal or otherwise as provided by this subchapter.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.260. Administrative Penalty; Injunction

Sec. 122.260.  ADMINISTRATIVE PENALTY;  INJUNCTION.  (a)  If a credit union or other person designated in a final order under this subchapter does not comply with the order, the commissioner, after giving notice, may assess an administrative penalty against the credit union, the designated person, or both, in an amount of not less than $100 or more than $10,000 each for each day of the violation of the order.
(b)  The credit union may not reimburse or indemnify a person for any part of the administrative penalty.
(c)  The commissioner may bring suit for injunction or to collect the administrative penalty in a district court of Travis County.  In the suit, a certificate by the commissioner showing a failure to pay an administrative penalty is prima facie evidence of:
(1)  the imposition of the penalty or the delinquency of the stated penalty amount;  and
(2)  compliance by the department with the law relating to the computation and imposition of the penalty.
(d)  The attorney general is entitled to recover reasonable attorney's fees from the credit union or the designated person, or both, if the attorney general prevails in a judicial action necessary for collection of the administrative penalty.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 533, Sec. 31, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 122 - Organizational and Financial Requirements › Subchapter F. Misconduct and Enforcement › Section 122.261. Confidentiality

Sec. 122.261.  CONFIDENTIALITY.  (a)  A determination letter, a cease and desist order, a removal order, each copy of a notice or correspondence, and all other documents or records relating to an order or determination letter issued under this subchapter are confidential and are not subject to public disclosure except in an action authorized by this subtitle or other authority.
(b)  The commissioner may disclose the information described by Subsection (a) to a share and deposit guaranty corporation or credit union or to a department, agency, or instrumentality of this state, another state, or the United States if the commissioner determines the disclosure is necessary or proper for the enforcement of the laws of this state or the United States.
(c)  The commissioner may release information regarding the existence of a final order to the public if the commissioner concludes that the release would enhance effective enforcement of the order.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 157, Sec. 10, eff. Sept. 1, 1999;  Acts 2003, 78th Leg., ch. 533, Sec. 32, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 123 - General Powers › Subchapter A. General Powers › Section 123.001. General Powers

Sec. 123.001.  GENERAL POWERS.  A credit union may exercise any power necessary or appropriate to accomplish the purposes for which it is organized and any power granted a corporation authorized to do business in this state, including any power specified in this chapter.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 123 - General Powers › Subchapter A. General Powers › Section 123.002. Incidental Powers

Sec. 123.002.  INCIDENTAL POWERS.  A credit union may exercise any right, privilege, or incidental power necessary or appropriate to exercise its specific powers and to accomplish the purposes for which it is organized.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 123 - General Powers › Subchapter A. General Powers › Section 123.003. Enlargement of Powers

Sec. 123.003.  ENLARGEMENT OF POWERS.  (a)  A credit union may engage in any activity in which it could engage, exercise any power it could exercise, or make any loan or investment it could make, if it were operating as a federal credit union.
(b)  Notwithstanding any other law, and in addition to the powers and authorities conferred under Subsection (a), a credit union has the powers or authorities of a foreign credit union operating a branch in this state if the commissioner finds that exercise of those powers or authorities is convenient for and affords an advantage to the credit union's members and maintains the fairness of competition and parity between the credit union and any foreign credit union.  A credit union does not have the field of membership powers or authorities of a foreign credit union operating a branch in this state.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 87, Sec. 3, eff. Sept. 1, 1999;  Acts 2003, 78th Leg., ch. 533, Sec. 33, eff. Sept. 1, 2003.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle D - Credit Unions › Chapter 123 - General Powers › Subchapter B. Operational Powers › Section 123.101. Contracts

Sec. 123.101.  CONTRACTS.  A credit union may make contracts.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.