17-2242. Administrator's jurisdiction.
17-2242
17-2242. Administrator's jurisdiction.
(a) If it appears to the administrator that the board of directors,
supervisory or credit committees, of any credit union has been dishonest,
reckless or incompetent in the performance of their duties, the
administrator: (1) May
recommend the removal of such persons; and (2) may submit any such findings,
reports or recommendations to any regularly or specially called meeting of
the board of directors, credit and supervisory committees or, if
the administrator has done
this, after due notice given at least
10 days in advance,
may submit the administrator's findings and recommendations
and reports to a general meeting of
the shareholders. Due notice shall be construed as being such notice as is
provided in the bylaws of the credit union for calling such meetings. The
administrator
may give such additional notice to the members as the administrator
deems advisable. The administrator and employees shall not be
personally liable for such reports, recommendations and findings made in
good faith. At any such meeting of the shareholders it shall be in order to
call for a vote to remove such officers, board members, committee members,
or employees. Such action by the shareholders to remove or not remove such
persons from their positions shall be absolute and need not be based on any
finding, concurrence or nonagreement with the administrator that such
persons are or have been dishonest, reckless or incompetent in the
performance of their duties. At any such meeting of the shareholders the
board of directors, supervisory or credit committees may concur or not
concur with a recommendation of removal whether or not they agree with the
findings of the administrator.
(b) As an alternative to and notwithstanding subsection (a), the
administrator
may suspend from office and prohibit from further participation in any manner
in the conduct of the affairs of a credit union any director, officer,
committee
member or employee who has committed any violation of a law, rules and
regulations
or of a cease and desist order or who has engaged or participated in any
unsafe or unsound practice in connection with the credit union or who has
committed or engaged in any act, omission or practice which constitutes
a breach of that person's fiduciary duty as such director, officer, committee
member or employee, when the administrator has determined
that such action or actions have resulted or will result
in substantial financial loss or other damage that seriously prejudices
the interests of the members. The credit union board of directors or
individuals named in the administrative action
shall be given a hearing or an
opportunity for a hearing in accordance with the provisions of the Kansas
administrative procedures act.
History: L. 1968, ch. 160, § 28;
L. 1987, ch. 86, § 5;
L. 1992, ch. 225, § 21;
L. 2007, ch. 187, § 1; July 1.