SF 3121

2nd Engrossment - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to financial institutions; regulating electronic financial terminals, and the
expenses of organizing and incorporating banks; authorizing the investment of
health savings accounts in transaction accounts; regulating the sale of forfeited
vehicles by financial institutions as secured parties; amending Minnesota Statutes
2004, sections 47.62, subdivision 1; 169A.63, subdivision 11; Minnesota Statutes
2005 Supplement, sections 47.75, subdivision 1; 48.15, subdivision 4; repealing
Minnesota Statutes 2004, sections 46.043; 47.62, subdivision 5.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2004, section 47.62, subdivision 1, is amended to read:

Subdivision 1.

General authority.

Any person may establish and maintain one
or more electronic financial terminals. Any financial institution may provide for its
customers the use of an electronic financial terminal by entering into an agreement with
any person who has established and maintains one or more electronic financial terminals if
that person authorizes use of the electronic financial terminal to all financial institutions
on a nondiscriminatory basis pursuant to section 47.64. deleted text begin Electronic financial terminals to
be established and maintained in this state by financial institutions located in states other
than Minnesota must file a notification to the commissioner as required in this section.
The notification may be in the form lawfully required by the state regulator responsible
for the examination and supervision of that financial institution. If there is no such
requirement, then notification must be in the form required by this section for Minnesota
financial institutions.
deleted text end

Sec. 2.

Minnesota Statutes 2005 Supplement, section 47.75, subdivision 1, is amended
to read:

Subdivision 1.

Retirement, health savings, and medical savings accounts.

(a) A
commercial bank, savings bank, savings association, credit union, or industrial loan and
thrift company may act as trustee or custodian:

(1) under the Federal Self-Employed Individual Tax Retirement Act of 1962, as
amended;

(2) of a medical savings account under the Federal Health Insurance Portability and
Accountability Act of 1996, as amended;

(3) of a health savings account under the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003, as amended; and

(4) under the Federal Employee Retirement Income Security Act of 1974, as
amended.

(b) The trustee or custodian may accept the trust funds if the funds are invested
only in savings accounts or time deposits in the commercial bank, savings bank, savings
association, credit union, or industrial loan and thrift company new text begin , except that health savings
accounts may also be invested in transaction accounts. Health savings accounts invested in
transaction accounts shall not be subject to the restrictions in section 48.512, subdivision
3 new text end . All funds held in the fiduciary capacity may be commingled by the financial institution
in the conduct of its business, but individual records shall be maintained by the fiduciary
for each participant and shall show in detail all transactions engaged under authority
of this subdivision.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2005 Supplement, section 48.15, subdivision 4, is amended
to read:

Subd. 4.

Retirement, health savings, and medical savings accounts.

(a) A state
bank may act as trustee or custodian:

(1) of a self-employed retirement plan under the Federal Self-Employed Individual
Tax Retirement Act of 1962, as amended;

(2) of a medical savings account under the Federal Health Insurance Portability and
Accountability Act of 1996, as amended;

(3) of a health savings account under the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003, as amended; and

(4) of an individual retirement account under the Federal Employee Retirement
Income Security Act of 1974, as amended,

if the bank's duties as trustee or custodian are essentially ministerial or custodial in nature
and the funds are invested only (i) in the bank's own savings or time deposits new text begin , except that
health savings accounts may also be invested in transaction accounts. Health savings
accounts invested in transaction accounts shall not be subject to the restrictions in section
48.512, subdivision 3 new text end ; or (ii) in any other assets at the direction of the customer if the bank
does not exercise any investment discretion, invest the funds in collective investment funds
administered by it, or provide any investment advice with respect to those account assets.

(b) Affiliated discount brokers may be utilized by the bank acting as trustee or
custodian for self-directed IRAs, if specifically authorized and directed in appropriate
documents. The relationship between the affiliated broker and the bank must be fully
disclosed. Brokerage commissions to be charged to the IRA by the affiliated broker should
be accurately disclosed. Provisions should be made for disclosure of any changes in
commission rates prior to their becoming effective. The affiliated broker may not provide
investment advice to the customer.

(c) All funds held in the fiduciary capacity may be commingled by the financial
institution in the conduct of its business, but individual records shall be maintained by
the fiduciary for each participant and shall show in detail all transactions engaged under
authority of this subdivision.

(d) The authority granted by this section is in addition to, and not limited by, section
47.75.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4.

Minnesota Statutes 2004, section 169A.63, subdivision 11, is amended to read:

Subd. 11.

Sale of forfeited vehicle by secured party.

(a) A financial institution
with a valid security interest in or a valid lease covering a forfeited vehicle may choose to
dispose of the vehicle under this subdivision, in lieu of the appropriate agency disposing
of the vehicle under subdivision 9. A financial institution wishing to dispose of a vehicle
under this subdivision shall notify the appropriate agency of its intent, in writing, within
30 days after receiving notice of the seizure and forfeiture. The appropriate agency shall
release the vehicle to the financial institution or its agent after the financial institution
presents proof of its valid security agreement or of its lease agreement deleted text begin and the financial
institution agrees not to sell the vehicle to a member of the violator's household, unless
the violator is not convicted of the offense on which the forfeiture is based deleted text end . The financial
institution shall dispose of the vehicle in a commercially reasonable manner as defined in
section 336.9-610.

(b) After disposing of the forfeited vehicle, the financial institution shall reimburse
the appropriate agency for its seizure, storage, and forfeiture costs. The financial
institution may then apply the proceeds of the sale to its storage costs, to its sale
expenses, and to satisfy the lien or the lease on the vehicle. If any proceeds remain, the
financial institution shall forward the proceeds to the state treasury, which shall credit the
appropriate fund as specified in subdivision 9.

Sec. 5. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2004, sections 46.043; and 47.62, subdivision 5, new text end new text begin are repealed.
new text end