• Expansion and Restriction of Investment of Local Monies
• Public Guardian Appointed to Fight Elder Abuse
• Report on Guardian or Conservatorship Accounts Through the Courts

Expansion and Restriction of Investment of Local Monies.

Existing California law allowed local public agencies to invest surplus money in negotiable certificates of deposit issued by financial institutions including state or federal credit unions. This new California law expands the investment beyond surplus money of local agencies to those not required for immediate use. However, investment in a credit union is prohibited when a member of the legislative body (such as a city council member) or other specified city officer or employee serves on the board of directors or certain committees of the credit union. Therefore, if your credit union wants to be able to issue certificates of deposits to cities or public agencies, you will need to review who sits on your board of directors and committees to determine if that makes that particular city's or local agency's investment illegal.

Public Guardian Appointed to Fight Elder Abuse.

Although prior law authorized a public guardian to be appointed when there was no other qualified person (family, friend or neighbor) qualified and willing act, this new law expands greatly the powers of the public guardian. The powers of the public guardian are very sweeping in taking control of the home environment of the elderly person to throw out the abuser.

The new law requires the guardian and conservators to file original account statements from financial institutions, including account statements of their wards or conservatees as part of the periodic accountings filed with the court. The bill would also require that certain information be kept confidential.

This law provides for a form entitled "Certificate of Authority" to be used by the public guardian to deny use of, access to or prohibit residency in the home of the elderly person and would require the public guardian to serve the elder person with a copy of the certification and provide that receipt of the certification by a financial institution or others in possession of an elder person's property to provide information and surrender property to the public guardian. This is meant to be a safe harbor for credit unions. Once the credit union receives a "Certificate of Authority" it may work with the public guardian without fear of reprisal from either the elder person or his/her abuser.

Financial institutions, including credit unions, still do not have a duty to inquire as to whether elder abuse is taking place. However, in the future, credit unions may become a reporting entity requiring them to contact adult protective services when they see patterns of possible elder abuse.

Report on Guardian or Conservatorship Accounts Through the Courts

Previously, California State law required a guardian or conservator of an estate to submit a copy of account statements of financial institutions with specific information to the Court on a periodic basis. This new law shifts the burden to the financial institution itself. When a guardian or conservator, pursuant to letters of guardianship or conservatorship of the state takes position or control or any assets held by a financial institution, including a credit union, the financial institution then is required to file with the court a statement containing specific information. The new law also requires that certain personal information concerning the child or conservatee to be kept confidential, which is just a reinforcement of the privacy laws under Graham-Leech federal privacy law.

Since certain unions do not frequently see guardianships and conservatorship, the sufficiencies of legal papers and the requirements of the credit union upon receiving these legal papers are often questioned. If you have any doubt as to the sufficiency of the papers or what you need to do in response to receiving them, we suggest you seek legal counsel.