HB1695 (2020) Detail

Relative to background checks for certain persons under the banking law.


HB 1695-FN - AS AMENDED BY THE HOUSE

 

11Mar2020... 0861h

2020 SESSION

20-3095

11/03

 

HOUSE BILL 1695-FN

 

AN ACT relative to background checks for certain persons under the banking law.

 

SPONSORS: Rep. Butler, Carr. 7; Rep. Fargo, Straf. 14

 

COMMITTEE: Commerce and Consumer Affairs

 

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ANALYSIS

 

This bill requires banks to pay the cost of background investigations and criminal history records checks, requires trust company directors to submit to such checks, and provides for the removal of trust company directors and officers by the bank commissioner.

 

This bill is a recommendation of the committee to study the effects of past New Hampshire trust code legislation, established pursuant to 2019, 230:5.

 

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

11Mar2020... 0861h 20-3095

11/03

 

STATE OF NEW HAMPSHIRE

 

In the Year of Our Lord Two Thousand Twenty

 

AN ACT relative to background checks for certain persons under the banking law.

 

Be it Enacted by the Senate and House of Representatives in General Court convened:

 

1  Organization of State Banks; Application.  Amend RSA 383-A:3-305(e)(6) to read as follows:

(6)  In addition to paying the cost for any examination or investigation of the background and criminal history of any person pursuant to this section, [The commissioner may require] the organizer [to] shall pay the actual costs of each background investigation and criminal history records check.

2  Trust Company Act; Number of Directors.  Amend RSA 383-C:6-601 to read as follows:

383-C:6-601  [Number of] Directors.  

(a)  The board of directors of a trust company shall be composed of at least 5 directors.  A director need not be a resident of New Hampshire or a citizen of the United States, unless otherwise required by the commissioner in consideration of the trust company's safety and soundness.  

(b)  Every new director shall submit to a background investigation and criminal history records check, to include submission of financial and other information in accordance with RSA 383-A:3-305(e).  A trust company shall submit notice of any material change related to the background investigation and criminal history records check of any director or any new information related to the experience, ability, standing, competence, trustworthiness, and integrity of a director that could jeopardize the safe and sound operation of the trust company within 30 days of learning of such change.  The cost of any examination or investigation of the background information and criminal history shall be paid by the trust company.

3  New Section; Trust Company Act; Removal of Directors or Officers by Commissioner.  Amend RSA 383-C by inserting after section 6-603 the following new section:

383-C:6-604  Removal of Directors or Officers by Commissioner.  In addition to the grounds for removal set forth in RSA 383-A:9-902, the commissioner may also remove a director or officer of a trust company if, in the opinion of the commissioner, the director or officer does not possess the experience, ability, standing, competence, trustworthiness, and integrity to ensure the safe and sound operation of the trust company.  The commissioner shall act in accordance with the procedure described in RSA 383-A:9-902 for any such removal.

4  Family Trust Company Act; Directors and Officers.  Amend RSA 383-D:8-801(a) to read as follows:

(a)  A family trust company shall have a board of directors, and that board of directors must have not less than three members.  A director need not be a resident of New Hampshire or a citizen of the United States, unless otherwise required by the commissioner in consideration of the family trust company's safety and soundness.  [RSA 383-C:6-601] RSA 383-C:6-601(a) shall not apply to family trust companies.

5  Effective Date.  This act shall take effect 60 days after its passage.

 

LBAO

20-3095

Amended 3/20/20

 

HB 1695-FN- FISCAL NOTE

AS AMENDED BY THE HOUSE (AMENDMENT #2020-0861h)

 

AN ACT relative to background checks for certain persons under the banking law.

 

FISCAL IMPACT:      [ X ] State              [    ] County               [    ] Local              [    ] None

 

 

 

Estimated Increase / (Decrease)

STATE:

FY 2020

FY 2021

FY 2022

FY 2023

   Appropriation

$0

$0

$0

$0

   Revenue

$0

Indeterminable

Indeterminable

Indeterminable

   Expenditures

$0

Indeterminable

Indeterminable

Indeterminable

Funding Source:

  [    ] General            [    ] Education            [    ] Highway           [ X ] Other - Fees, fines, penalties and assessments

 

 

 

 

 

METHODOLOGY:

This bill requires banks to pay the cost of background investigations and criminal history records checks, requires trust company directors to submit to such checks, and provides for the removal of trust company directors and officers by the bank commissioner.

 

The Banking Department indicates it currently may charge the actual costs of each background investigation and criminal history records check.  This bill would mandate that the entity seeking the charter must pay for all costs related to the required background and criminal histories to include the cost of examination or investigation of the background and criminal history.  In addition, the bill would require newly appointed directors of trust companies to submit to background investigation and criminal history checks and pay the associated costs.  The Banking Department reports the costs of such examinations and investigations and amount or revenues that would be generated are indeterminable since it is not known how many investigations or examinations would occur or how long each will take.

 

The Banking Department is self-funded.  The Department's costs are covered by fees, fines, penalties and assessments.  Revenue collected from fees, fines, penalties collected reduces the assessment imposed on all chartered entities under RSA 383:11, II.  In any given year, if the revenue from fees, fines and penalties is sufficient to cover the Department's costs, no assessment is imposed.  The assessment amount is dependant on revenue from examination fees, fines and penalties on all state banks, trust companies and credit unions.  These amounts vary from year to year and cannot be predicted in advance.

 

AGENCIES CONTACTED:

Banking Department

 

Links

HB1695 at GenCourtMobile
HB1695 Discussion

Action Dates

Date Body Type
Jan. 28, 2020 House Hearing
March 3, 2020 House Exec Session
House Floor Vote
March 11, 2020 House Floor Vote

Bill Text Revisions

HB1695 Revision: 8363 Date: March 31, 2020, 3:24 p.m.
HB1695 Revision: 7808 Date: Jan. 15, 2020, 2:15 p.m.

Docket

Date Status
Jan. 8, 2020 Introduced 01/08/2020 and referred to Commerce and Consumer Affairs HJ 1 P. 32
Jan. 28, 2020 Public Hearing: 01/28/2020 09:30 am LOB 302
Feb. 24, 2020 Subcommittee Work Session: 02/24/2020 09:00 am LOB 302
March 3, 2020 Executive Session: 03/03/2020 10:30 am LOB 302
Committee Report: Ought to Pass with Amendment # 2020-0861h (Vote 17-2; RC)
March 11, 2020 Committee Report: Ought to Pass with Amendment # 2020-0861h for 03/11/2020 (Vote 17-2; RC) HC 10 P. 41
March 11, 2020 Amendment # 2020-0861h: AA VV 03/11/2020 HJ 7 P. 142
March 11, 2020 Ought to Pass with Amendment 2020-0861h: MA VV 03/11/2020 HJ 7 P. 142
June 16, 2020 Introduced 06/16/2020, and Laid on Table, MA, VV; 06/16/2020; SJ 8
June 16, 2020 No Pending Motion; 06/16/2020 SJ 8