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Public Act 92-0485
SB48 Enrolled LRB9201499JSpc
AN ACT concerning corporate fiduciaries.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Corporate Fiduciary Act is amended by
changing Sections 5-10 and 8-1 and adding Sections 2-6.5,
6-13.5, and 9-6 as follows:
(205 ILCS 620/2-6.5 new)
Sec. 2-6.5. Directors.
(a) The business and affairs of a corporate fiduciary
shall be managed by its board of directors, which shall
exercise its powers in accordance with this Section.
(b) The directors shall be elected as provided in
this Act. Any omission to elect a director or directors
shall not impair any of the rights and privileges of the
corporate fiduciary or of any person in any way interested.
The existing directors shall hold office until their
successors are elected and qualify.
(c) Notwithstanding the provisions of any certificate of
authority heretofore or hereafter issued, the number of
directors, not fewer than 5, may be fixed from time to time
by the stockholders at any meeting of the stockholders
called for the purpose of electing directors or
changing the number thereof by the affirmative vote of at
least two-thirds of the outstanding stock entitled to vote at
the meeting, and the number so fixed shall be the board
regardless of vacancies until the number of directors is
thereafter changed by similar action.
(d) Except as otherwise provided in this subsection,
directors shall hold office until the next annual meeting
of the stockholders succeeding their election or until
their successors are elected and qualify. If the board of
directors consists of 6 or more members, in lieu of electing
the membership of the whole board of directors annually, the
by-laws of a corporate fiduciary may provide that the
directors shall be divided into either 2 or 3 classes, each
class to be as nearly equal in number as is possible. The
term of office of directors of the first class shall expire
at the first annual meeting of the stockholders after their
election, that of the second class shall expire at the second
annual meeting after their election, and that of the third
class, if any, shall expire at the third annual meeting after
their election. At each annual meeting after classification,
the number of directors equal to the number of the class
whose terms expire at the time of the meeting shall be
elected to hold office until the second succeeding annual
meeting if there are 2 classes or until the third succeeding
annual meeting if there are 3 classes. Vacancies may be
filled by stockholders at a special meeting called for the
purpose. If authorized by the corporate fiduciary's
by-laws or an amendment thereto, the directors of a corporate
fiduciary may properly fill a vacancy or vacancies arising
between stockholders' meetings, but at no time may the number
of directors selected to fill a vacancy in this manner
during any interim period between stockholders' meetings
exceed one-third of the total membership of the board of
(e) The board of directors shall hold regular
meetings at least once each month, provided that, upon prior
written approval by the Commissioner, the board of
directors may hold regular meetings less frequently than
once each month but at least once each calendar quarter. A
special meeting of the board of directors may be held as
provided by the by-laws. A special meeting of the board
of directors may also be held as provided in Section 5-5 of
this Act. A majority of the board of directors shall
constitute a quorum for the transaction of business unless a
greater number is required by the by-laws. The act of the
majority of the directors present at a meeting at which a
quorum is present shall be the act of the board of directors
unless the act of a greater number is required by the
(f) A member of the board of directors shall be elected
president. The board of directors may appoint other officers,
as the by-laws may provide, and fix their salaries to carry
on the business of the corporate fiduciary. The board of
directors may make and amend by-laws (not inconsistent with
this Act) for the government of the corporate fiduciary and
may, by the affirmative vote of a majority of the board of
directors, establish reasonable compensation of all
directors for services to the corporation as directors,
officers, or otherwise. An officer, whether elected or
appointed by the board of directors or appointed
pursuant to the by-laws, may be removed by the board of
directors at any time.
(g) The board of directors shall cause suitable books
and records of all the corporate fiduciary's transactions to
(h) The provisions of this Section do not apply to a
corporate fiduciary that is a trust department of a bank,
savings bank, savings and loan association, or foreign
banking corporation issued a certificate of authority
pursuant to the Foreign Banking Office Act.
(205 ILCS 620/5-10) (from Ch. 17, par. 1555-10)
Sec. 5-10. Fees; receivership account.
(a) There shall be paid to the Commissioner by every
corporate fiduciary including each trust company, bank,
savings and loan association, and savings bank to which this
Act shall apply, reasonable fees that the Commissioner shall
assess to recover the costs of administration, certification,
examination and supervision of trusts authorized under this
(b) In addition to the fees authorized in subsection (a)
of this Section the Commissioner shall assess reasonable
receivership fees and establish a Corporate Fiduciary
Receivership account in the Bank and Trust Company Fund to
provide for the expenses that arise from the administration
of the receivership of a corporate fiduciary under this Act.
The aggregate of such assessments shall be paid into the
Corporate Fiduciary Receivership account in the Bank and
Trust Company Fund. The assessments for this account shall
be levied until the sum of $4,000,000
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$350,000 has been
deposited into the account from assessments authorized
herein, whereupon the Corporate Fiduciary Receivership
account assessment shall be abated. If a receivership of a
corporate fiduciary under this Act requires expenditures from
this account, assessments may be reinstituted until the
balance in the Corporate Fiduciary Receivership account
arising from assessments is restored to $4,000,000 $350,000.
(c) The Commissioner may, by rule, establish a
reasonable manner of assessing the receivership assessments
under this Section.
(Source: P.A. 86-754; 86-952.)
(205 ILCS 620/6-13.5 new)
Sec. 6-13.5. Pledging requirements.
(a) The Commissioner may require a trust company holding
a certificate of authority under this Act to pledge to the
Commissioner securities or a surety bond which shall run to
the Commissioner in an amount, not to exceed $1,000,000, that
the Commissioner deems appropriate for costs associated with
the receivership of the trust company. In the event of a
receivership of a trust company, the Commissioner may,
without regard to any priorities, preferences, or adverse
claims, reduce the pledged securities or the surety bond to
cash and, as soon as practicable, utilize the cash to cover
costs associated with the receivership.
(b) If the trust company chooses to pledge securities to
satisfy the provisions of this Section, the securities shall
be held at a depository institution or a Federal Reserve Bank
approved by the Commissioner. The Commissioner may specify
the types of securities that may be pledged in accordance
with this Section. Any fees associated with holding such
securities shall be the responsibility of the trust company.
(c) If the trust company chooses to purchase a surety
bond to satisfy the provisions of this Section, the bond
shall be issued by a bonding company, approved by the
Commissioner, that is authorized to do business in this State
and that has a rating in one of the 3 highest grades as
determined by a national rating service. The bond shall be
in a form approved by the Commissioner. The trust company
may not obtain a surety bond from any entity in which the
trust company has a financial interest.
(205 ILCS 620/8-1) (from Ch. 17, par. 1558-1)
Sec. 8-1. False statements. It is unlawful for any
officer, director, employee, or agent of any corporate
fiduciary subject to examination by the Commissioner or any
person filing an application or submitting information in
connection with an application to the Commissioner to who
shall willfully and knowingly subscribe to or make, or cause
to be made, any false statement or false entry with intent to
deceive any person or persons authorized to examine into the
affairs of the such corporate fiduciary or applicant or with
intent to deceive the Commissioner or his administrative
officers in the performance of their duties under this Act.
A person who violates this Section is upon conviction thereof
shall be guilty of a Class 3 felony.
(Source: P.A. 85-858.)
(205 ILCS 620/9-6 new)
Sec. 9-6. Audits.
(a) At least once in each calendar year a corporate
fiduciary must cause its books and records to be audited by
an independent licensed public accountant. The Commissioner
may prescribe the scope of the audit within generally
accepted audit principles and standards.
(b) The independent licensed public accountant shall
provide a written audit report to the corporate fiduciary's
board of directors or to a committee appointed by the
corporate fiduciary's board of directors. If the audit
report is given to a committee appointed by the corporate
fiduciary's board of directors, the committee shall, within
30 days after the date of receipt of the audit report,
provide the board of directors with a written summary of the
audit findings as detailed in the audit report.
(c) The corporate fiduciary's board of directors or
committee appointed by the board of directors shall cause a
copy of the audit report and any written summary pursuant to
paragraph (b) of this Section to be filed with the
Commissioner within 45 days after receipt of the audit
Section 99. Effective date. This Act takes effect upon
Passed in the General Assembly May 30, 2001.
Approved August 23, 2001.
Effective August 23, 2001.