The Vermont Statutes Online

Title 8 : Banking and Insurance

Chapter 221 : Organization and Management of Credit Union

Subchapter 003 : GOVERNING BODY, OFFICERS, AND COMMITTEES

• § 31311. Suspension and removal

  (a) The governing body of a credit union shall have the power to remove, by a two-thirds vote of its members at a regular or special meeting, a director or a governing-body-appointed committee member:

  (1) who fails, without good cause, to attend three consecutive meetings of the governing body or committee or one-half of such meetings held during a calendar year;

  (2) who is no longer qualified to serve; or

  (3) for any of the causes enumerated and in accordance with subsection (b) of this section.

  (b) The governing body of a credit union shall have the power to suspend at any time, by a two-thirds’ vote of its members, at a regular or special meeting, any director, member of a governing-body-appointed committee, officer, or agent for good cause, including:

  (1) a violation of any statute, regulation, or order applicable to such credit union;

  (2) the participation in any unsafe or unsound practice in connection with such credit union;

  (3) the commission of or participation in a crime that is punishable by imprisonment for a term exceeding one year under state or federal law, as charged in any information, indictment, or complaint, and if continued service or participation by such director, member of a governing-body-appointed committee, officer, or agent may pose a threat to the interests of the members of such credit union;

  (4) the failure of such person to perform his or her duties or breach of his or her fiduciary duty;

  (5) the use of his or her official position in a manner contrary to the interests of the credit union or its members; and

  (6) the breach of a written agreement with the Commissioner.

  (c) The suspension shall take effect immediately, and the Commissioner shall be notified promptly of such suspension. Within seven business days after the effective date of the suspension, the governing body shall cause notice to be given to all members of the credit union of a special meeting of members to be held for the purpose of hearing the report of the governing body regarding the suspension and voting on removal, provided such notice shall not be given if the director, member of a governing-body-appointed committee, officer, or agent who is subject to suspension resigns. The special meeting shall be held no more than 21 business days after the effective date of the suspension. The membership of the credit union shall have, by majority vote, the authority to accept or reject the report of the governing body. If such action involves removal, the credit union shall promptly notify the Commissioner of such removal.

  (d) If any person required to be bonded by this part or by applicable regulation shall cease to be bonded or shall lose his or her ability to be bonded, such person shall be suspended and removed immediately, and the Commissioner shall be notified promptly of such suspension and removal.

  (e) The supervisory committee shall have the power to suspend at any time, by a two-thirds vote of its members at a meeting called for that purpose, any director, member of a governing-body-appointed committee, officer, or agent for cause. The suspension shall take effect immediately, and the Commissioner shall be notified promptly of such suspension. Not later than seven business days after the effective date of the suspension, the supervisory committee shall cause notice to be given to all members of the credit union of a special meeting of members to be held for the purpose of hearing the report of the supervisory committee regarding the suspension and voting on removal, provided such notice shall not be given if the person who is subject to suspension resigns. The special meeting shall be held not more than 21 business days after the date of suspension. The membership of the credit union shall have the authority to accept or reject the report of the supervisory committee. The supervisory committee shall take any related action as the members deem necessary. If such action involves removal, the credit union shall promptly notify the Commissioner of such removal. (Added 2005, No. 16, § 1, eff. July 1, 2005; amended 2021, No. 105 (Adj. Sess.), § 327, eff. July 1, 2022.)