Code of Virginia § 6.2-1369. Credit union need not inquire as to fiduciary funds used to purchase shares in fiduciary's personal account.
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/va/title-6-2/chapter-13/6-2-1369A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
A. If any fiduciary or agent purchases shares in a credit union in his own name
(i)with share drafts or other instruments drawn by him upon an account in his own name as fiduciary,
(ii)with share drafts or other instruments drawn by him upon an account in the name of his principal, if he is empowered to draw share drafts or other instruments thereto, or
(iii)with share drafts or other instruments payable to his principal and endorsed by him as fiduciary, the credit union issuing such shares shall not be bound to inquire whether the fiduciary is committing thereby a breach of his obligation as fiduciary.
B. The credit union is authorized to pay the amount of the shares issued or any part thereof upon the withdrawal by the fiduciary without being liable to the principal, unless the credit union receives payment for the shares or pays the withdrawal
(i)with the actual knowledge that the fiduciary, in purchasing such shares or in making such withdrawal, is committing a breach of his obligation as a fiduciary, or
(ii)with knowledge of such facts that its action in issuing the shares or paying the withdrawal amounts to bad faith.
2000, c. 744 , § 6.1-225.50:2; 2010, c. 794 .