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The 191st General Court of the Commonwealth of Massachusetts

Section 8A: Purchase, establishment, installation, etc. of electronic branches; location; safeguards

[Text of section added by 2014, 482, Sec. 56. See also, Section 8A added by 2014, 466, Sec. 1 effective October 1, 2015, below.]

Section 8A. For the purposes of this section, the following words shall, unless the context clearly requires otherwise, have the following meanings:?

''Electronic branch'', an electronic device, other than a telephone operated by a consumer, through which a consumer may initiate an electronic fund transfer. Such term includes, but is not limited to automated teller machines and cash dispensing machines. Such term does not include a teller machine or similar device located on the premises of and operated solely by an employee of a financial institution or a point-of-sale terminal.

''Organization'', any person, corporation, association or partnership which assists or provides services to a financial institution or merchant in order to make available electronic fund transfers; provided, however, that a financial institution or merchant shall not be considered an organization.

''Point-of-sale terminal'', an electronic terminal located on the premises of a merchant when such terminal is used with the assistance of an employee of a merchant for a customer's purchase or lease of goods or services sold or leased by such merchant or adjustments thereto or the receipt of cash by the customer which is ancillary to the customer's purchase or lease of goods or services from such merchant; provided, however, that such terminal shall be deemed an electronic branch for the purposes of this chapter whenever it is used for any other electronic fund transfer, or for an electronic fund transfer involving a customer's account held by an organization, or for an electronic fund transfer solely for customers of a single financial institution or bank holding company subject to chapter 167A or the federal Bank Holding Company Act of 1956, 12 U.S.C. section 1841 et seq.

A credit union shall comply with the federal Electronic Fund Transfer Act, 15 U.S.C. section 1693 et seq. and the regulations promulgated thereunder; provided, however, the maximum liability of a consumer under 15 U.S.C. section 1693g shall be limited to $50.00.

After a vote of its board of directors, a credit union, except as otherwise provided in this section, may purchase, establish, install, operate, lease or use individually or with any other financial institution or organization or share with any other financial institution or organization any number of manned or unmanned electronic branches at which a customer may make deposits, withdrawals, transfers of funds, obtain advances against preauthorized lines of credit, cash checks or pay obligations, and any number of point-of-sale terminals; provided, however, that withdrawals from such electronic branches, other than those located at an office of a credit union, shall be made only from a demand deposit account, negotiable withdrawal order account, or statement account or against a preauthorized line of credit; and provided, further that the credit union shall have applied for and obtained the approval of the commissioner for such electronic branch except that a credit union at whose office such electronic branch is located need not have applied for or obtained such approval. The commissioner shall approve such application if, in the commissioner's opinion, such action will promote a sound banking system which provides for the needs of the people and business, encourages competition, discourages monopolies and does not ignore legislative policies.

There shall be no geographical limitation on the location of electronic branches which a credit union may purchase, establish, install, operate, lease or use individually or with any other financial institution or organization or share with any other financial institution or organization; provided, however, that the site location for such electronic branches, other than an electronic branch located at an office of a financial institution or in another state, shall be subject to approval by, and regulation of, the commissioner. An electronic branch may be located in a mobile unit under such conditions and limitations as the commissioner, by regulation, shall establish.

A credit union shall adopt and maintain safeguards to insure the safety of a customer using the electronic branch, to insure the safety of the funds, items and other information at the electronic branch and to assist in the identification of criminals. The commissioner may promulgate rules and regulations establishing minimum standards for such safeguards. Such safeguards shall be in place and operational at the time such electronic branch begins to transact business; provided, however, that such safeguards shall not apply to an electronic branch located at an office of a credit union.

No such electronic branch located at other than the office of a credit union shall be manned or operated at any time by an employee of any financial institution, holding company of a financial institution or affiliate thereof, or any organization except on a temporary basis to instruct operators or customers, service the electronic branch or to use such electronic branch on said employee's own behalf.


Chapter 171: Section 8A. Establishment of foreign credit union or out-of-state federal credit union branch offices or depots in the commonwealth; definition applicable to Secs. 8A to 8F

[Text of section added by 2014, 466, Sec. 1 effective October 1, 2015. See 2014, 466, Sec. 3. See also, Section 8A added by 2014, 482, Sec. 56, above.]

Section 8A. For the purposes of this section and sections 8B to 8F, inclusive, the terms ''foreign credit union'' and ''out-of-state federal credit union'' shall mean a credit union with its principal place of business in the state of Connecticut, Maine, New Hampshire, New York, Rhode Island or Vermont.

Any foreign credit union or out-of-state federal credit union doing business similar to any business referred to in section 2, may establish and maintain branch offices or depots in the commonwealth, if the foreign credit union or out-of-state federal credit union is expressly authorized to do so by the laws under which it is organized and operates; provided, however, that the laws of the state in which the credit union has its principal place of business expressly authorize, under conditions not more restrictive than those imposed by this chapter as determined by the commissioner, Massachusetts credit unions to establish and maintain branches and depots therein. Such foreign credit unions and out-of-state federal credit unions shall establish and maintain branches or depots in Massachusetts, in accordance with the same laws which govern such activities by Massachusetts credit unions; provided, however, that the initial branch office other than 1 established pursuant to chapter 167B, or, if more than 1, the branch deemed to be the initial office by such entities, shall be considered the main office in the commonwealth to determine the geographical limitations on the establishment of branch offices.

The commissioner of banks shall promulgate rules and regulations relative to the administration and enforcement of sections 8A to 8F, inclusive. The rules and regulations shall include procedures for accepting applications from qualifying credit unions for approval to open a branch office.