Amendments relating to nonfederally insured credit unions

(a)

In general

Subsection (a) of section 43 of the Federal Deposit Insurance Act (12 U.S.C. 1831t(a)) is amended by adding at the end the following new paragraph:

(3)

Enforcement by appropriate state supervisor

Any appropriate State supervisor of a private deposit insurer, and any appropriate State supervisor of a depository institution which receives deposits that are insured by a private deposit insurer, may examine and enforce compliance with this subsection under the applicable regulatory authority of such supervisor.

(b)

Amendment relating to disclosures required, periodic statements and account records

Section 43(b)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1831t(b)(1)) is amended by striking or similar instrument evidencing a deposit and inserting or share certificate. (c)

Amendments relating to disclosures required, advertising, premises

Section 43(b)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1831t(b)(2)) is amended to read as follows:

(2)

Advertising; premises

(A)

In general

Include clearly and conspicuously in all advertising, except as provided in subparagraph (B); and at each station or window where deposits are normally received, its principal place of business and all its branches where it accepts deposits or opens accounts (excluding automated teller machines or point of sale terminals), and on its main Internet page, a notice that the institution is not federally insured. (B)

Exceptions

The following need not include a notice that the institution is not federally insured: (i)Statements or reports of financial condition of the depository institution that are required to be published or posted by State or Federal law or regulation. (ii)Any sign, document, or other item that contains the name of the depository institution, its logo, or its contact information, but only if the sign, document, or item does not include any information about the institution’s products or services or information otherwise promoting the institution. (iii)Small utilitarian items that do not mention deposit products or insurance if inclusion of the notice would be impractical.

(d)

Amendments relating to acknowledgment of disclosure

Section 43(b)(3) of the Federal Deposit Insurance Act (12 U.S.C. 1831t(b)(3)) is amended to read as follows:

(3)

Acknowledgment of disclosure

(A)

New depositors obtained other than through a conversion or merger

With respect to any depositor who was not a depositor at the depository institution before the effective date of the Financial Services Regulatory Relief Amendments Act of 2006, and who is not a depositor as described in subparagraph (B), receive any deposit for the account of such depositor only if the depositor has signed a written acknowledgment that— (i)the institution is not federally insured; and (ii)if the institution fails, the Federal Government does not guarantee that the depositor will get back the depositor’s money. (B)

New depositors obtained through a conversion or merger

With respect to a depositor at a federally insured depository institution that converts to, or merges into, a depository institution lacking Federal insurance after the effective date of the Financial Services Regulatory Relief Amendments Act of 2006, receive any deposit for the account of such depositor only if— (i)the depositor has signed a written acknowledgment described in subparagraph (A); or (ii)the institution makes an attempt, as described in subparagraph (D) and sent by mail no later than 45 days after the effective date of the conversion or merger, to obtain the acknowledgment. (C)

Current depositors

Receive any deposit after the effective date of the Financial Services Regulatory Relief Amendments Act of 2006 for the account of any depositor who was a depositor on that date only if— (i)the depositor has signed a written acknowledgment described in subparagraph (A); or (ii)the institution makes an attempt, as described in subparagraph (D) and sent by mail no later than 45 days after the effective date of the Financial Services Regulatory Relief Amendments Act of 2006, to obtain the acknowledgment. (D)

Alternative provision of notice to current depositors and new depositors obtained through a conversion or merger

(i)

In general

Transmit to each depositor who has not signed a written acknowledgment described in subparagraph (A)— (I)a conspicuous card containing the information described in clauses (i) and (ii) of subparagraph (A), and a line for the signature of the depositor; and (II)accompanying materials requesting the depositor to sign the card, and return the signed card to the institution.

(e)

Repeal of provision prohibiting nondepository institutions from accepting deposits

Section 43 of the Federal Deposit Insurance Act (12 U.S.C. 1831t) is amended— (1)by striking subsection (e); and (2)by redesignating subsections (f) and (g) as subsections (e) and (f), respectively. (f)

Repeal of provision concerning nondepository institutions masquerading as depository institutions and clarification of depository institutions covered by the statute

Subsection (e)(2) (as so redesignated by subsection (e) of this section) of section 43 of the Federal Deposit Insurance Act (12 U.S.C. 1831t) is amended to read as follows:

(2)

Depository institution

The term depository institution— (A)includes any entity described in section 19(b)(1)(A)(iv) of the Federal Reserve Act; and (B)does not include any national bank, State member bank, or Federal branch.

(g)

Repeal of FTC authority to enforce independent audit requirement; concurrent state enforcement

Subsection (f) (as so redesignated by subsection (e) of this section) of section 43 of the Federal Deposit Insurance Act (12 U.S.C. 1831t) is amended to read as follows:

(f)

Enforcement

(1)

Limited FTC enforcement authority

Compliance with the requirements of subsections (b) and (c), and any regulation prescribed or order issued under any such subsection, shall be enforced under the Federal Trade Commission Act by the Federal Trade Commission. (2)

Broad State enforcement authority

(A)

In general

Subject to subparagraph (C), an appropriate State supervisor of a depository institution lacking Federal deposit insurance may examine and enforce compliance with the requirements of this section, and any regulation prescribed under this section. (B)

State powers

For purposes of bringing any action to enforce compliance with this section, no provision of this section shall be construed as preventing an appropriate State supervisor of a depository institution lacking Federal deposit insurance from exercising any powers conferred on such official by the laws of such State. (C)

Limitation on State action while Federal action pending

If the Federal Trade Commission has instituted an enforcement action for a violation of this section, no appropriate State supervisor may, during the pendency of such action, bring an action under this section against any defendant named in the complaint of the Commission for any violation of this section that is alleged in that complaint.

Clarification of scope of applicable rate provision

Section 44(f) of the Federal Deposit Insurance Act (12 U.S.C. 1831u(f)) is amended by adding at the end the following new paragraphs:

(3)

Other lenders

In the case of any other lender doing business in the State described in paragraph (1), the maximum interest rate or amount of interest, discount points, finance charges, or other similar charges that may be charged, taken, received, or reserved from time to time in any loan, discount, or credit sale made, or upon any note, bill of exchange, financing transaction, or other evidence of debt issued to or acquired by any other lender shall be equal to not more than the greater of the rates described in subparagraph (A) or (B) of paragraph (1). (4)

Other lender defined

For purposes of paragraph (3), the term other lender means any person engaged in the business of selling or financing the sale of personal property (and any services incidental to the sale of personal property) in such State, except that, with regard to any person or entity described in such paragraph, such term does not include— (A)an insured depository institution; or (B)any person or entity engaged in the business of providing a short-term cash advance to any consumer in exchange for— (i)a consumer’s personal check or share draft, in the amount of the advance plus a fee, where presentment or negotiation of such check or share draft is deferred by agreement of the parties until a designated future date; or (ii)a consumer authorization to debit the consumer’s transaction account, in the amount of the advance plus a fee, where such account will be debited on or after a designated future date.