Thanks in large part to the Louisiana Credit Union League’s lobbying efforts, Gov. John Bel Edwards has signed credit union-backed legislation that will eliminate the requirement of credit union members to secure an affidavit to create a payable on death (POD) account.
The measure, HB 724, which was sponsored by Rep. Ed Price (D-Gonzales), takes effect Aug.1.
Currently, members' account-opening documents likely contain an option to designate an account as POD, which allocates funds in the account to a designated beneficiary upon the account owner's death. Louisiana law allows account owners to designate a POD beneficiary that, if issued correctly with an affidavit, overrides provisions in a will or other inheritance document.
The affidavit stipulation puts credit unions at risk with potential for lawsuits and excessive payouts following the death of an account holder. Louisiana was the only state requiring an affidavit for a designated POD account at credit unions, placing an undue burden on members.
Julie Carpenter, compliance officer at Jefferson Financial CU, Metairie, La., testified on behalf of Louisiana credit unions in support of the measure.