As any other member, trusts are required to qualify for membership by being within a credit union’s field of membership (FOM), paying par value and meeting any other membership requirements a credit union may impose.
In April of last year, I blogged about Trusts and Field of Membership (FOM). At the time, most of the guidance in this area came from NCUA legal opinion letters. Recently, the NAFCU Compliance Team has received a few questions on FOM in the context of trusts after NCUA recently updated the model Federal Credit Union (FCU) Bylaws. With this update, NCUA incorporated into the Bylaws numerous existing legal opinion letters and clarified several provisions. This blog will focus on summarizing the Bylaw provisions related to qualifying a trust for membership in a Federal Credit Union under the provisions now located in the FCU Bylaws.
Qualifying a Trust for Membership Based on Individual Membership
Revocable Trusts. Membership requirements for revocable trusts are met though the settlor, who is the original owner of the funds. Therefore, settlors are required to be a member of the credit union in his or her own right.
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