HOUSE FILE 405

BY  COMMITTEE ON COMMERCE

(SUCCESSOR TO HF 261)

A BILL FOR

An Act relating to records requirements applicable to state banks and state credit unions, and causes of action and duties in relation thereto.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

   Section 1.  Section 524.221, subsection 1, unnumbered paragraph 1, Code 2011, is amended to read as follows:
   A state bank is not required to preserve its records for a period longer than eleven seven years after the first day of January of the year following the time of the making or filing of such records, provided, however, that account records showing unpaid balances due to depositors shall not be destroyed. A copy of an original may be kept in lieu of any such original record. For purposes of this subsection, a copy includes any duplicate, rerecording or reproduction of an original record from any photograph, photostat, microfilm, microcard, miniature or microphotograph, computer printout, electronically stored data or image, or other process which accurately reproduces or forms a durable medium for accurately and legibly reproducing an unaltered image or reproduction of the original record.
   Sec. 2.  Section 524.221, subsections 2 and 3, Code 2011, are amended to read as follows:
   2.  All causes of action, other than actions for relief on the grounds of fraud or mistake, against a state bank based upon a claim or claims founded on a written contract, or a claim or claims inconsistent with an entry or entries in a state bank record, made in the regular course of business, shall be deemed to have accrued, and shall accrue for the purpose of the statute of limitations one year after the breach or failure of performance of a written contract, or one year after the date of such entry or entries. No action founded upon such a cause may be brought after the expiration of ten six years from the date of such accrual.
   3.  The provisions of this section, insofar as applicable, shall apply to the records of a national bank or a federally chartered savings bank or a federally charted savings and loan association.
   Sec. 3.  Section 533.322, subsection 1, Code 2011, is amended to read as follows:
   1.  The superintendent may adopt rules regarding the preservation of records and files of a state credit union or any other person supervised or regulated by the superintendent. A state credit union is not required to preserve its records for a period longer than eleven seven years after the first day of January of the year following the time of the making or filing of such records. However, account records showing unpaid balances due to depositors shall not be destroyed.
   Sec. 4.  Section 533.324, Code 2011, is amended to read as follows:
   533.324Liability for destruction Preservation of records —— statute of limitations.
   1.  With the exception of certain account records which shall not be destroyed pursuant to section 533.322, liability shall not accrue against a state credit union for destroying records if the records were maintained for the minimum time provided for in this chapter. All causes of action, other than actions for relief on the grounds of fraud or mistake, against a state credit union based upon a claim or claims founded on a written contract, or a claim or claims inconsistent with an entry or entries in a state credit union record, made in the ordinary course of business, shall be deemed to have accrued, and shall accrue for the purpose of the statute of limitations one year after the breach or failure of performance of a written contract, or one year after the date of such entry or entries. No action founded upon such a cause may be brought after the expiration of six years from the date of such accrual.
   2.  In any cause or proceeding in which state credit union records or files may be called in question or be demanded of the state credit union, or any officer or employee of the state credit union, a showing that such records or files have been destroyed in accordance with the provisions of this chapter or rules adopted pursuant to this chapter shall be a sufficient excuse for the failure to produce them.
   Sec. 5.  Section 554.4406, subsection 2, Code 2011, is amended to read as follows:
   2.  If the items are not returned to the customer, the person retaining the items shall either retain the items or, if the items are destroyed, maintain the capacity to furnish legible copies of the items until the expiration of eleven seven years after receipt of the items. A customer may request an item from the bank that paid the item, and that bank must provide in a reasonable time either the item or, if the item has been destroyed or is not otherwise obtainable, a legible copy of the item.
EXPLANATION
   This bill reduces the period of time during which a state bank or state credit union is required to preserve its records from the currently required 11 years after the first day of January of the year following the time of the making or filing of the record, to seven years after the first day of January of the year following the time of the making or filing of the record.
   The bill additionally adds a claim or claims founded on a written contract to causes of action against a state bank subject to statute of limitations provisions contained in Code section 524.221, and reduces the statute of limitations period from 10 to six years. The bill applies the provisions of the Code section to federally chartered savings banks and federally chartered savings and loan associations, and duplicates these provisions in Code section 533.324, applicable to state credit unions.
   The bill also reduces from 11 to seven years the period of time during which legible copies of items paid and retained or destroyed with reference to a customer’s account must be maintained by a bank.