Helping Credit Unions Comply With the New Probate Code

Earlier this year, the legislature enacted updates to Maine’s Probate Code. Effective September 1, the changes in the law are now in effect and will impact how credit unions establish single-party and multiple-party accounts.

To help credit unions comply with the new Probate Code, the League developed a form all Maine credit unions can use to explicitly designate survivorship rights when opening a single-party or multiple-party account. This designation is required in the new law.

In addition, the League developed a Q&A to help credit unions navigate the new compliance requirements.  If your credit union has a question concerning Maine’s updated Probate Code that is not listed below, please contact Ellen Parent, the League’s Regulatory and Legislative Advocacy Coordinator, at 207-773-5671 x 353 or by email at for assistance.

Is my credit union required to use this form?

All depository institutions in Maine must begin using the form immediately as outlined in the statute.

Does the new law impact federally chartered credit unions?

Yes. The Probate Code applies to all credit unions in Maine regardless of whether they are a state-charted institution or federally-chartered institution.

What other laws impact the establishment of multiple-party accounts?

Title 9-B also includes a new provision requiring a signature card or other document include a clear and conspicuous notice to the depositor that upon the depositor’s death, the balance in the account belongs to the surviving party.

What is a multiple-party account?

A multiple-party account is any account where two or more people own the money held in the account. These accounts may be increased, decreased, opened, and closed by any of the account holders with or without the consent of the others.

As a joint owner on an account, a member can access the money in the account and close the account without the permission of the other owners.  That’s why members must explicitly agree to be a joint owner when establishing these types of accounts.

What is a POD designation?

POD stands for “Payable on Death.” This means that the account goes directly to the beneficiary when the member dies and is not distributed through the will or through a provision of law. The beneficiaries of a POD designation have no rights to the account until the member dies and the beneficiary may be changed by the owner at any point.

Do we have to fill out the form if we do not offer multiple-party accounts without survivorship rights?

Yes. Credit unions should use this form when opening any personal account.

What is an agent? Is an agent the same as a power of attorney?

An agent is an individual with limited authorization on an account. A power of attorney is a document that authorizes an agent who has gone through the courts to have certain powers on a variety of things that may relate to healthcare, contracts, finance, and all other things that the principal may do, including closing a financial account.

Why did the legislature amend this section of the Probate Code?

Changes were enacted to the Probate Code to better protect elders from financial abuse.  It is not uncommon for seniors to establish a joint bank account to enable another individual to assist them with their finances. Oftentimes, when an individual is added to an account, it is done for convenience and not with the intent of having that person inherit the sums remaining in the account upon the death of the original member.

Does the law provide my credit union any protection from liability?

The Probate Code protects credit unions that allow withdrawals to any parties or agents, unless they receive notice that the parties have died. More information can be found in the Probate Code under Article 6, Subpart 3.

What happened to LD 968? LD 242?

LD 968 from the 128th Legislature was repealed by LD 242 earlier this year. The substance of LD 968 was incorporated into the updated Probate Code.