Legislation Will Address Multiple-Party Account Opening Procedures

Last year, the Maine Legislature enacted legislation (LD 968) that changes how financial institutions open multiple-party accounts.  The new law, which went into effect on January 1, requires financial institutions to provide a document that asks whether or not the persons opening the account intend for the account proceeds to belong to the surviving account owner following the death of an account owner.  The form must be signed by each party to the account prior to opening and retained by the credit union.

Many credit unions expressed concerns about implementing the new process.  Recognizing that our members need additional time to comply with the law, the League worked with Senator Heather Sanborn to introduce Emergency legislation which would delay the implementation of the law to July 1, 2019 – the same day the state’s new probate code goes into effect. Delaying the effective date of LD 968 will allow financial institutions to offer agency designations allowed by the new probate code instead of multiple-party accounts.

Senator Sanborn’s bill has not been assigned a bill number, but because her legislation  was introduced as an Emergency measure, we expect it will be issued a number soon and moved to a Committee for consideration later this month.  The League will keep you apprised on this bill’s status.  In the interim, all credit unions should comply with LD 968 until further notified.