Each depositor insured to at least $250,000 per insured bank

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6000 - Consumer Protection


NOW ACCOUNTS

SEC. 2 WITHDRAWALS BY NEGOTIABLE OR TRANSFERABLE INSTRUMENTS FOR TRANSFERS TO THIRD PARTIES

(a)  AUTHORITY OF DEPOSITORY INSTITUTION; APPLICABILITY.--(1) Notwithstanding any other provision of law but subject to paragraph (2), a depository institution is authorized to permit the owner of a deposit or account on which interest or dividends are paid to make withdrawals by negotiable or transferable instruments for the purpose of making transfers to third parties.

(2)  Paragraph (1) shall apply only with respect to deposits or accounts which consist solely of funds in which the entire beneficial interest is held by one or more individuals or by an organization which is operated primarily for religious, philanthropic, charitable, educational, political or other similar purposes and which is not operated for profit, and with respect to deposits of public funds by an officer, employee, or agent of the United States, any State, county, municipality, or political subdivision thereof, the District of Columbia, the Commonwealth of Puerto Rico, American Samoa, Guam, any territory or possession of the United States, or any political subdivision thereof.

(b)  DEPOSITORY INSTITUTION DEFINED.--For purposes of this section, the term "depository institution" means--

(1)  any insured bank as defined in section 1813 of this title;

(2)  any State bank as defined in section 1813 of this title;

(3)  any mutual savings bank as defined in section 1813 of this title;

(4)  any savings bank as defined in section 1813 of this title;

(5)  any insured institution as defined in section 1724 of this title; and

(6)  any building and loan association or savings and loan association organized and operated according to the laws of the State in which it is chartered or organized; and, for purposes of this paragraph, the term "State" means any State of the United States, the District of Columbia, any territory of the United States, Puerto Rico, Guam, American Samoa, or the Virgin Islands.

(c)  FINE.--Any depository institution which violates this section shall be fined $1,000 for each violation.

[Codified to 12 U.S.C. 1832]

[Source:  Section 2 of the Act of August 16, 1973 (Pub. L. No. 93-100; 87 Stat. 342), effective September 14, 1973, as amended by section 2 of the Act of February 27, 1976 (Pub. L. No. 94-222; 90 Stat. 197), effective February 27, 1976; section 1301 of title XIII of the Act of November 10, 1978 (Pub. L. No. 95-630; 92 Stat. 3712), effective November 10, 1978; section 106 of title I of the Act of December 28, 1979 (Pub. L. No. 96-161; 93 Stat. 1235), effective December 28, 1979; section 303 of title III of the Act of March 31, 1980 (Pub. L. No. 96-221; 94 Stat. 146), effective December 31, 1980; section 706(a) of title VII of the Act of October 15, 1982 (Pub. L. No. 97-320; 96 Stat. 1540), effective October 15, 1982; and section 109 of title I of the Act of August 10, 1987 (Pub. L. No. 100-86; 101 Stat. 579), effective August 10, 1987]


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Last updated September 16, 2013 regs@fdic.gov