Legal Opinion Index Archive

Closing Accounts & Notice Requirements

Kansas and Missouri - July 2019

This legal opinion provides recommendations regarding providing advance notice before closing an account and what to do if federal benefits are received after the account has been closed. There are two separate legal opinions, one for Kansas and one for Missouri.

Divorce and Joint Account Owners

Kansas and Missouri - Nov. 2022

Many issues can arise with joint accounts. This white paper addresses angles such as one account owner requesting to remove another, who can close the account, freeze the funds, place stop pays, request account information, perform various transactions, and more. There are two separate white papers -- one for Kansas and one for Missouri.   

Copying Driver’s License (Memo)

Kansas and Missouri - Aug. 2018

This memo addresses whether a credit union can photocopy a driver’s license. There are two separate memos, one for Kansas and one for Missouri.

Member Expulsion

Kansas and Missouri - Feb. 2020

This legal opinion is for federally-chartered credit unions and addresses reasons for expulsion, how a member may be expelled, and details regarding the process that must be followed. Recent Federal Credit Union Bylaw changes have been incorporated. 

Kansas - March 2019

State-chartered versions address reasons for expulsion, how a member may be expelled, and details regarding the process that must be followed. A sample policy is included. Note: Missouri and Federal Charter versions are also available.   

Missouri - Nov. 2020

State-chartered version addresses reasons for expulsion, how a member may be expelled, and details regarding the process that must be followed. A sample policy is included. Has been updated to include recent statutory changes. Note: Kansas and federal charter versions are also available.

Powers of Attorney

Kansas and Missouri - May 2018

When a member presents a Power of Attorney, many questions can arise regarding the document itself, what an attorney in fact can do on behalf of the principal, how it can be revoked, when it terminates, etc. This legal opinion answers many of the questions credit unions have regarding Powers of Attorney. There are two separate legal opinions, one for Kansas and one for Missouri.

Overdraft & NSF Fees Litigation (White Paper)

Kansas and Missouri - June 2019

Credit unions, and other financial institutions across the country, have been the subject of class-action lawsuits relating to their practices for charging overdraft and NSF fees. This white paper identifies potential areas for concern, suggests what each credit union should review, and the changes that should be considered to minimize risk. Also, a portion of the white paper provides advice regarding how to respond to the requests credit unions are receiving to forgive certain fees. Information is not state-specific.

Retention of Electronic Documents

Kansas and Missouri - Dec. 2022

This white paper answers common questions regarding whether electronic copies of documents can be kept in the place of the originals. Citations are provided for resources available at both the state and federal levels. Prudent practices and angles that should be considered are included. There are two separate white papers – one for Kansas and one for Missouri.  

Unclaimed Property

Kansas and Missouri - Nov. 2019

This legal opinion provides an overview of the unclaimed property process, i.e., what it is, the difference between unclaimed and dormant/inactive, how best to handle, charging fees, sending statements, additional considerations for certificates and IRAs, how other state laws are involved, recovering funds, etc. There are two separate legal opinions, one for Kansas and one for Missouri. 

ACH Transfers – Relying on Account Numbers

Kansas and Missouri - Feb. 2021

This legal opinion provides guidance regarding a credit union’s ability to rely solely on account numbers when accepting Automated Clearing House (ACH) transfers. Some of the angles covered:  whether or not the source of funds matters, specific information regarding tax refunds – both federal and state, how to handle misdirected or fraudulent deposits, offsets, closed accounts, and more. One legal opinion covers federal charters; and Kansas, and Missouri state-chartered credit unions.  

Check Deposit – Payee Blank (Email)

Kansas and Missouri - Dec. 2018

This email provides guidance regarding situations where a member is depositing a check and the payee line is blank, e.g., whether the credit union should have the member write in their name on the payee line before depositing, deposit the item with the payee link blank or not accept the item at all. Information is not state-specific.

Check Endorsement Area Issues (Email)

Kansas and Missouri - June 2019

This email provides guidance for situations where the endorsement area on the back of a check has certain language scratched out or the mobile deposit box is checked or was checked then scratched out. Information is not state-specific.

E-Checks – Rejecting Individually or Refusing Entirely

Kansas and Missouri - June 2019

This legal opinion provides information as to whether a credit union can: 1) refuse to accept e-checks entirely (a class of checks), or 2) reject them on an individual basis. Information is not state-specific.

Drawings & Raffles

Kansas and Missouri - March 2019

This legal opinion addresses participation, prohibitions, qualifications, rules notification, IRS reporting, and more. There are two separate legal opinions, one for Kansas and one for Missouri.

Lien on Shares

Kansas, and Missouri - Dec. 2021

This legal opinion provides an overview of the credit union’s right of set-off against a member’s shares on deposit. It discusses the right to set-off when a member defaults on loan payments and when a member’s account balance goes negative. Three separate legal opinions are available, one for Federal, one for Kansas, and one for Missouri.

Missouri Secured Loans: Repossessions (White Paper)

Missouri - Aug. 2021

As a result of litigation involving a few Missouri credit unions, Missouri CEOs inquired as to the best practices for their institutions at the CEO Roundtable. This white paper discusses the Consumer Financial Protection Bureau‘s (CFPB’s) consent order against Navy Federal Credit Union and best practices under Missouri law regarding a credit union’s response to loan default, including repossession and disposition or sale of collateral.

Property Tax on Repossessed Vehicles

Kansas and Missouri - Oct. 2018

Per this legal opinion, the credit union is liable for property taxes on repossessed vehicles. Information is included regarding how to minimize liability. There are two separate legal opinions, one for Kansas and one for Missouri.

Repossession Deficiency Notice Litigation (White Paper)

Kansas and Missouri - Aug. 2021

A recent trend has emerged among consumer advocates seeking to challenge the accrual of prejudgment interest on defaulted loans. While this practice is relatively common, a new legal theory is gaining traction. This white paper seeks to strengthen awareness of this claim and likely areas of exposure while equipping credit unions to make informed decisions pertaining to the new risks. There are two separate white papers, one for Kansas and one for Missouri.

Right to Cure Notice - Adding Member’s Name (Email)

Kansas and Missouri - Dec. 2019

Can/should a credit union include the member/borrower’s name on a Right to Cure notice? Statutes that address content, model forms and the legal opinions we have regarding this topic do not specifically state to list the member’s name. Since there have many lawsuits regarding the Right to Cure process, credit unions are understandably extremely cautious about form content. This e-mail provides a recommendation and additional information. One email covers both Kansas and Missouri.

Right to Cure Process

Kansas and Missouri - Sept. 2021

This legal opinion provides an overview of the Right to Cure Process. Information such as when a notice is required, who should receive it, timing, content, accepting partial payments, etc. There are two separate legal opinions, one for Kansas and one for Missouri.

Deceased Member Issues

Kansas and Missouri - Oct. 2020

This legal opinion provides guidance regarding a multitude of deceased member issues that can arise, such as various probate procedures, how to handle funds going into or out of the account (via ACH, wire transfer, and/or check), joint account owner considerations, transfers to payable on death (POD) beneficiaries, safe deposit box rentals, the credit union’s rights to set-off, Powers of Attorney, and more! There are two separate legal opinions, one for Kansas and one for Missouri.

Electronic Signatures and Records (White Paper)

Kansas and Missouri - July 2019

As a result of ongoing confusion regarding the Electronic Signatures in Global & National Commerce Act (E-SIGN Act), we requested a white paper regarding this topic that provides information regarding the following:

• Legal considerations
• Consent, notification & delivery requirements
• Applying to specific services or broadly
• Which documents are not allowed
• Recordkeeping
• Technology changes 

Child Support Data Match Lien Fee (Email)

Missouri -  Jan. 2020

Child Support Data Match became mandatory in Missouri on August 28, 2019. Credit unions are now wondering if they can charge a fee to place this type of lien on a member’s account. Our attorney does not recommend a credit union charge a fee for this type of lien. For additional information, please request a copy of the email. Note: This applies to Missouri only, as Kansas does not have this type of program in place.

Garnishments – IRAs and HSAs (Email)

Kansas and Missouri - Dec. 2018

This email addresses whether or not Individual Retirement Accounts (IRAs) and Health Savings Accounts (HSAs) are subject to, or exempt from, garnishment in both Missouri and Kansas.   

Garnishment Procedures

Kansas - Oct. 2018, Missouri - Sept. 2018

This legal opinion outlines the procedures for responding to garnishments on members’ accounts. There are two separate legal opinions, one for Kansas and one for Missouri.   

IRS Levy Procedures

Kansas and Missouri - July 2018

This legal opinion answers questions credit unions have regarding processing Internal Revenue Service (IRS) Levies such as which accounts and funds are subject to a levy, how credit union liens are affected, notification requirements, charging permissible fees, how to remit, and more. One legal opinion covers both Kansas and Missouri.

Vehicle Lien Perfection

Missouri - July 2021

This legal opinion provides a detailed overview of the state-specific vehicle lien perfection process, issues that can arise, credit union options, fees, bankruptcy concerns, and more. The Missouri version has been updated to include recent statutory changes.  Note:  A Kansas version is also available.

Lien on Shares

Kansas and Missouri

This legal opinion provides an overview of the credit union's right of set-off against a member's shares on deposit. It discusses the right to set-off when a member defaults on loan payments and when a member's account balance goes negative. Three separate legal opinions are available, one for Federal, one for Kansas, and one for Missouri.

Divorce and Loans

Kansas and Missouri - Dec. 2022

Married couples often enter into joint loan agreements. This white paper addresses what happens to jointly-acquired debt when a couple divorces, e.g., are both parties still liable, who should get loan statements and Right-to-Cure Notices, liens on accounts going forward, titling issues, and more. There are two separate white papers – one for Kansas and one for Missouri.   

Lending-Application, Origination & Other Fees

Kansas and Missouri - May 2022

This legal opinion addresses the restrictions and limitations on certain loan fees, including application, origination, participation, third party, and other fees on various types of loans. Information regarding which fees must be included in the APR calculation, as well as whether up charging is permissible is also included. There are three separate legal opinions - one for Federal, one for Missouri, and one for Kansas.  

Lending to Minors

Kansas and Missouri - Oct. 2018

There are many risks associated with lending to minors. This legal opinion answers many of the questions credit unions have regarding protecting the credit union’s rights and how to avoid pitfalls. There are two separate legal opinions, one for Kansas and one for Missouri.

Lending Rates, Payments, and Terms

Kansas and Missouri - Dec. 2021

This legal opinion covers general lending issues around interest rates, timing and amount of payments, and loan terms.  Many topics are addressed, including the allowance of prepayments, the allowable length of a loan, and who should sign a security agreement. The opinion touches on personal as well as business loans. Three separate legal opinions are available, one for Federal, one for Kansas, and one for Missouri.

Returning Loan Notes Marked Paid

Kansas and Missouri - June 2018

This legal opinion covers whether a credit union is required to return a loan note marked paid and if this can be done electronically. One legal opinion covers both Kansas and Missouri.

Skip-a-Pay

Missouri - Aug. 2021, Kansas - Dec. 2021

This legal opinion provides an overview of a credit union’s ability to collect a fee for allowing a member to defer monthly loan payments (referred to as “skip a pay”) and includes detailed information regarding the process that needs to be followed, etc. Three separate legal opinions are available, one for Federal, one for Kansas, and one for Missouri. 

Vehicle Lien Perfection

Kansas - Aug. 2019, Missouri - July 2021

This legal opinion provides a detailed overview of the state-specific vehicle lien perfection process, issues that can arise, credit union options, fees, bankruptcy concerns, and more. There are two separate legal opinions, one for Kansas and one for Missouri.

Guaranteed Asset Protection (GAP) Refund Lawsuits (White Paper)

Kansas and Missouri - Feb. 2021

There is growing concern among credit unions about financial institutions being the subject of class-action lawsuits involving refunds for Guaranteed Asset Protection (GAP) waivers and other add-on loan products, including credit life insurance, credit disability insurance, mechanical breakdown coverage, and vehicle service contracts. 

This white paper provides information to help mitigate the risk of litigation, reviews current class action lawsuits involving these products, addresses federal legal issues, and relevant Kansas and Missouri statutes and regulations.   

Telephone & Video Monitoring

Kansas and Missouri - Jan. 2020

This legal opinion addresses:

• The credit union monitoring telephone calls -- how to obtain consent, exceptions, and policy guidelines
• The credit union video monitoring -- whether to enable audio capabilities and areas in which to prohibit
• Members taking photos, videos, and audio recordings inside the credit union -- whether to prohibit, how to notify, and suggested procedures

There are two separate legal opinions, one for Kansas and one for Missouri. 

Sharing with Local Law Enforcement (Email)

Kansas and Missouri - March 2019

This email provides limited guidance regarding disclosing member information to local law enforcement. One email covers both Kansas and Missouri.

Trust Loans & Accounts

Kansas and Missouri - Aug. 2020

This legal opinion provides a wealth of information regarding trust loans and accounts, such as terminology used, the two primary kinds, components, certifications, titling, TINs, issuing checks and/or debit cards, using a Power of Attorney, loans and credit cards, share insurance coverage, record retention, and frequently asked questions with answers. There are two separate legal opinions, one for Kansas and one for Missouri.