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Issue: Whether a church expansion fund is a ‘financial institution’ subject to any North Dakota state or federal credit union or financial institution laws?
| Area of Law: | Banking & Finance Law |
| Keywords: | Financial institution; Church expansion fund; An agent for deposits |
| Jurisdiction: | North Dakota |
| Cited Cases: | None |
| Cited Statutes: | N.D. Cent. Code Sec. 6-10-01 (1999); 12 U.S.C. Sec. 4301 et seq. (1999) |
| Date: | 10/01/2000 |
Accepting “deposits” may subject a church expansion fund to certain state and federal disclosure laws regarding deposits even if a church expansion fund is not considered a “financial institution.” For example, North Dakota law provides that a license is required to act as an agent for deposits:
No person, partnership, association, corporation, or limited liability company, except as otherwise authorized by law, may engage in the business of receiving, as agent for another, moneys for the purpose of deposit in a bank, without first having applied to the commissioner and received a license so to do.
N.D. Cent. Code Sec. 6-10-01 (1999). Thus, if a church expansion fund places any of the funds it receives from individuals and characterized as “deposits” into a bank or other financial institution, it may be subject to licensing requirements under North Dakota law. In addition, the Truth in Savings Act may apply if a church expansion fund places “deposits” from individuals into a financial institution. 12 U.S.C. Sec. 4301 et seq. (1999).
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