We have a business checking account for an unincorporated association that was opened with an employer identification number (EIN) in 2013. We know that the account was for an engineer society’s scholarship fund but have no information on its organizational structure or owners. The only items in our file are meeting minutes from 2013 and a signature card listing two authorized signers. The account is not considered dormant according to our records. A family member of one of the authorized signers notified us that the two signers on the account have died and that they are unsure whether the organization still exists. What should we do if we are asked to disburse the funds in the account? What documentation do we need to protect ourselves and make sure we are not disbursing funds to individuals who are not entitled to receive them?

We do not believe you should disburse funds from the business checking account unless you receive direction from an authorized signer or a court order to release the funds.

Because the business checking account was opened in the name of the unincorporated association, using its EIN, we believe that you should treat the account as property of the unincorporated association — not of its authorized signers. As such, we do not recommend disbursing the account funds unless you receive direction from an authorized signer — in this case, either someone who is representing one of the deceased authorized signers or a new authorized signer who can establish authority over the account — or a court order to release the funds.

We also recommend establishing when the last indication of interest on the account was, which will determine when you are required to report and remit the account to the State Treasurer as unclaimed property. According to the Illinois Revised Uniform Unclaimed Property Act, the presumed abandonment period for a demand deposit account is three years “after the date of the last indication of interest in the property by the apparent owner.”

Additionally, you may be able to find more information about the unincorporated association by using the Illinois Attorney General’s Charitable Trust Database. Associations that hold more than $4,000 for a charitable purpose are required to register with the Illinois Attorney General under the Illinois Charitable Trust Act, and associations that will be soliciting donations are similarly required to register under the Solicitation for Charity Act (unless an exception applies).

For resources related to our guidance, please see:

FinCEN Final Rule, Customer Due Diligence Requirements for Financial Institutions, 81 Fed. Reg. 29397, 29416 (May 11, 2016) (“FinCEN also notes that as a general matter, small local community organizations, such as Scout Troops and youth sports leagues, are unincorporated associations rather than legal entities and therefore not subject to the beneficial ownership requirement.”)

Deposit Insurance Coverage Regulations, 12 CFR 330.11(c) (“The deposit accounts of an unincorporated association engaged in any independent activity shall be added together and insured up to the SMDIA in the aggregate, separately from the accounts of the person(s) or entity(ies) comprising the unincorporated association. An unincorporated association shall be deemed to exist, for purposes of this paragraph, whenever there is an association of two or more persons formed for some religious, educational, charitable, social or other noncommercial purpose.”)

FDIC, Financial Institution Employee’s Guide to Deposit Insurance (Corporation, Partnership and Unincorporated Association Accounts) (“An unincorporated association is defined as an association of two or more persons formed for some religious, educational, charitable, social or other non-commercial purpose.”)

FDIC, Financial Institution Employee’s Guide to Deposit Insurance (Corporation, Partnership and Unincorporated Association Accounts) (“Deposit accounts held in the name of an unincorporated association (such as a neighborhood association or a scout troop) engaged in an independent activity are insured as the association’s deposits, separately from the personal deposits of the officers or members. In order for the account to receive separate coverage, the title of the account must include the name of the unincorporated association. In other words, if the accounts are titled using the names of the officers of the organization, the accounts may be insured as the personal deposits of the individuals and not as the funds of the organization. Insurance coverage for deposits held by an unincorporated association is a maximum of $250,000. The number of signatories on the account or the number of members that the association may have does not affect the amount of insurance coverage.”)

Illinois RUUPA, 765 ILCS 1026/15-201 (“Subject to Section 15-210, the following property is presumed abandoned if it is unclaimed by the apparent owner during the period specified below: . . . (6) financial organization deposits as follows: . . . (i) a demand deposit, 3 years after the date of the last indication of interest in the property by the apparent owner.”)

Illinois Attorney General, Charitable Trust Database Search

Charitable Trust Act, 760 ILCS 55/2 (“This Act applies to any and all trustees, as defined in Section 3, holding property of a value in excess of $4,000.”)

Charitable Trust Act, 760 ILCS 55/3 (“‘Trustee’ means any person, individual, group of individuals, association, corporation, not-for-profit corporation, estate representative, or other legal entity holding property for or solicited for any charitable purpose; or any chief operating officer, director, executive director or owner of a corporation soliciting or holding property for a charitable purpose.”)

Charitable Trust Act, 760 ILCS 55/6 (“Every trustee subject to this Act who has received property for charitable purposes shall file and register with the Attorney General, within 6 months after any part of the income or principal is received for application to the charitable purpose, and prior to disbursements, a copy of the trust agreement, articles of incorporation or other written instrument, if any, providing for his title, powers or duties.”)

Solicitation for Charity Act, 225 ILCS 460/2 (“Every charitable organization, except as otherwise provided in Section 3 of this Act, which solicits or intends to solicit contributions from persons in this State or which is located in this State, by any means whatsoever shall, prior to any solicitation, file with the Attorney General upon forms prescribed by him, a registration statement, accompanied by a registration fee of $15, which statement shall include the following certified information. . . .”)

Solicitation for Charity Act, 225 ILCS 460/1 (“‘Charitable organization’ means any benevolent, philanthropic, patriotic, or eleemosynary person or one purporting to be such which solicits and collects funds for charitable purposes and includes each local, county, or area division within this State of such charitable organization, provided such local, county or area division has authority and discretion to disburse funds or property otherwise than by transfer to any parent organization.”)

Solicitation for Charity Act, 225 ILCS 460/1 (“‘Person’ means any individual, organization, group, association, partnership, corporation, trust or any combination of them.”)