(1) If it appears that any credit union is bankrupt or insolvent, or that it has willfully violated any provision of this chapter, or is operating in an unsafe or unsound manner, the Director of the Department of Consumer and Business Services shall issue an order temporarily suspending the credit union’s operations for not less than 30 nor more than 60 days. The board of directors shall be given notice by registered mail or by certified mail with return receipt of such suspension, and a list of the specific violations of this chapter.
(2) Upon receipt of the suspension notice, the credit union shall cease all operations, except those authorized by the director. The board of directors shall then file with the director a reply to the suspension notice, and may request a hearing to present a plan of corrective actions proposed if it desires to continue operations. The board may request that the credit union be declared insolvent and a liquidating agent be appointed.
(3) Upon receipt from the suspended credit union of evidence that the conditions causing the order of suspension have been corrected, the director may revoke the suspension notice and permit the credit union to resume normal operations.
(4) If the director, after issuing notice of suspension and providing an opportunity for a hearing, rejects the credit union’s plan to continue operations, the director may then revoke the credit union’s charter, appoint a liquidating agent and liquidate the credit union. The credit union may request the appropriate court to stay execution of such action. Involuntary liquidation may not be ordered prior to the conclusion of suspension procedures outlined in this section.
(5) If, within the suspension period, the credit union fails to answer the suspension notice or request a hearing, the director may then revoke the credit union’s charter, appoint a liquidating agent and liquidate the credit union. [1975 c.652 §69; 1985 c.762 §99; 1991 c.249 §68]
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