UNITED STATES OF AMERICA

BEFORE THE NATIONAL CREDIT UNION ADMINISTRATION

In the Matter of

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx                                                Docket 96-013

Insurance Claim

Bartow Employees Federal Credit Union

Decision and Order on Appeal

Decision

This matter comes before the National Credit Union Administration Board (Board) pursuant to 12 CFR 745.202 as an administrative appeal of the determination by the Liquidating Agent of Bartow Employees Federal Credit Union denying the xxxxxxx insurance claim in the amount of xxxxxxxxxx. 

Summary of Claim

This appeal involves the two accounts the claimants held at the credit union.

xxxxxxxxxxxxxxxxxxxxx--  Appellants claim the accounts should be treated as individual accounts.  The Liquidating Agent  treated the accounts as joint accounts with the same combination of individuals, aggregating the accounts for insurance purposes.  The Asset Liquidation Management Center (ALMC)^[1] paid Appellants xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx under accrued and unposted dividends) plus xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx under accrued and unposted dividends) = xxxxxxxxxxx -- and issued an uninsured share certificate for xxxxxxxxxx.                       

General Background

Bartow Employees Center Federal Credit Union, located in Cartersville, Georgia, was an occupational credit union chartered to serve teachers in Cartersville county.  It had approximately 1200 members.  The Board placed the credit union into involuntary liquidation due to insolvency, effective November 27, 1995.

Facts

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (husband, wife and adult son) had two accounts (xxxxxxxxxxxxxx) at the credit union.  The account card for account xxxx contained xxxx xxxxxxx name and signature on the front.  The account card for account xxxx contained xxxxxxxxxxxxxx name and signature on the front.  Both account cards had the signatures of all three account holders on the joint account agreement on the back of the signature cards.  The joint account agreement provided for equal withdrawal rights for all signatories.

Regulations and Analysis

Part 745 of NCUA’s Regulations addresses share insurance coverage.  Section 745.2 states in part:

                        (a)This Part provides for determination by the [NCUA] Board

                        of the amount of members’ insured accounts.  The rules

                        for determining the insurance coverage of accounts

                        maintained by members in the same or different

                        rights and capacities in the same insured credit union

                        are set forth in the following provisions of this Part. 

Section 745.8 addresses joint accounts.  The relevant provisions follow:

                        (a) Separate insurance coverage.  Accounts owned jointly…

                         shall be insured separately from    accounts individually

owned by any of the co-owners.

                        (b) Qualifying joint accounts.  Joint accounts are insured

                        separately from individual accounts up to a maximum of

                        $100,000 provided that each of the co-owners has personally

                        signed an account signature card and has a right of withdrawal

                        on the same basis as the other co-owners.

                        (c) Failure to qualify.  An account owned jointly which does

                        not qualify as a joint account for purposes of insurance of

                        accounts shall be treated as owned by the named persons

                        as individuals and the actual ownership interest of each such

                        person in such account shall be added to any other accounts

                        individually owned by such person and insured up to $100,000 in the aggregate... .

                        (d) Same combination of individuals.  All joint accounts owned

                        by the same combination of individuals shall be added together

                        and insured up to $100,000 in the aggregate.

The joint account agreements on both accounts xxxxxxxxxxx were signed by xxxxx xxxxxxxxxxxxxxxxxxxxxxxxx.  Thus, the accounts were established as joint accounts with the same combination of individuals.  The Liquidating Agent properly insured these accounts pursuant to §745.8(d) of the regulations for a total of $100,000.

The xxxxxx are entitled to xxxxxxxx total in insurance coverage for their two accounts at the credit union.  The xxxxxx have been paid the appropriate amounts according to the NCUA insurance regulations.

The xxxxxx have not presented any additional argument or evidence to support a claim  for additional insurance coverage and the Board finds no basis for any additional payout. 

      Order

For the reasons set forth above, it is ORDERED as follows:

The Board upholds the Liquidating Agent’s decision to deny xxxxxxxxxxxxxxxxxxxxxxxx   xxxxxx claim in the amount of xxxxxxxxxx and denies the xxxxxxx appeal.

The Board’s decision constitutes a final agency determination.  Pursuant to

12 CFR 745.203(c), this final determination is reviewable in accordance with the provisions of Chapter 7, Title 5, United States Code, by the United States Court of Appeals for the District of Columbia or the court of appeals for the Federal judicial circuit where the credit union’s principal place of business was located.  Such action must be filed not later than 60 days after the date of this final determination.

So ORDERED this 19th day of December, 1996 by the National Credit Union Administration Board.

                                                            _____________________

                                                            Becky Baker

                                                            Secretary of the Board