NEWS: The League has updated its Safe Deposit Box Lease (WCUL #81071, Rev. 12/25) (Sample). Credit unions that currently subscribe to this form will automatically receive the new version in their email soon. A sample with all the changes to the text and fields highlighted can be downloaded here. The following changes were made to the form:
Change #1: No insurance coverage
This language was added to the lease form:
Contents Not Insured. The contents of the Box are not insured by the Credit Union or the National Credit Union Administration. For your protection, you may wish to insure the contents of the Box through an insurance company of your choice. You must keep a complete list and description of all property stored in your Box, along with any available proof of ownership/value, and store the list/records somewhere other than the Box. You understand and agree that safe deposit boxes and vaults are not fireproof, burglarproof, or waterproof.
We included this notice to be sure that members who lease safe deposit boxes do not misunderstand federal share insurance coverage. Contrary to popular belief, no federal agency, including the NCUA, insures box contents. Nor does the credit union that is leasing the box.
After 9/11, one New York bank was sued when the boxes from their vault in the World Trade Center could not be salvaged. Their lease had said that box contents “may not be insured,” which the plaintiffs claimed was misleading.
Check your credit union’s bond coverage
Credit unions should check with their bonding company about any safe deposit box coverage they may have. Understand that such coverage is typically designed to protect the credit union if claims are made against it because of a loss of a member’s physical property.
Additional precautions
To help avoid potential liability, credit unions might consider taking certain steps in addition to using our revised lease agreement, such as:
- Giving a separate “No Insurance Disclosure’ form, printed in clear and conspicuous type, to each new renter;
- Displaying a “No Insurance” sign inside or near the vault area, clearly stating that obtaining insurance protection is the renter’s responsibility;
- Avoiding the use of misleading statements, promises or guarantees, such as “fireproof,” “waterproof,” or “burglarproof” in safe deposit box marketing brochures, statement stuffers, or other promotional items; and
- Training employees to be careful when answering questions about insurance or the security of the safe deposit box vault. Difficult questions should be referred to a supervisor. Members may be directed to contact the NCUA directly about share insurance coverage questions.
Change #2: Identifying information
The lease agreement used to include an “Identification” box on p. 2, which asked for each lessee’s name, date of birth, telephone number, eye color, and a security code. We removed this box, which was no longer useful and may have caused confusion.
Please note two things about identifying safe deposit box renters:
- The federal Customer Identification Program (CIP) rules under the Bank Secrecy Act require credit unions to gather identifying information and verify the identities of all “customers” who open “accounts.” The term “account” includes a safe deposit box lease. Therefore, credit unions should conduct CIP on all those who lease safe deposit boxes, including co-lessees. The League offers a separate Customer Identification Card (WCUL #81080) to gather the necessary identifying information. For details on CIP, please see The League’s ii Release No. 0159.
- The League’s ii Release No. 0146 cautions credit unions that, “Each person seeking access to the safe deposit box area should be positively identified and his or her authority verified. The person should be required to provide picture identification. Ideally, the photo ID will contain a written physical description of the person as well as a signature. The credit union employee should then verify that the person has authority to access the box.”
Other miscellaneous technical changes we made to the form include:
- Rearranged Lessee’s names/addresses at top of form along with the associated data entry fields.
- Fixed a typo in paragraph #7.
- Added the usual footer fields for credit unions’ usage.
- Updated the revision date and page number designations.
- Minor changes to various data fields.
Forms 101
League forms are only available in .pdf format, by annual subscription. Please note that League forms are not customizable. Credit unions must review the forms to make their own determinations of whether the forms are suitable for their use, consistent with their own policies and procedures. Accuracy is important. If any WCUL form is not suitable, the credit union should utilize the services of one of the national form companies that have some ability to customize their forms.
Please be sure that one person, authorized by your credit union, has reviewed the current Credit Union Forms Terms & Conditions and submitted an acknowledgment electronically.
When WCUL forms are updated, current subscribers to those forms will automatically receive the new versions as part of their annual maintenance license agreement.
Credit unions that are not currently subscribed to League forms may purchase them from The League online at theleague.coop > Solutions > Credit Union Forms. Please review the instructions on how to purchase & download new forms on the storefront page. To avoid errors, you must log into our website with your member credentials before attempting to make any purchase(s). Prices for each form are indicated in your shopping cart at the time of purchase.
Descriptions and samples for all League forms are available on our website and in the online store. A summary listing of all League forms and their latest revision dates can be downloaded here.
For questions about use of the forms, please call The League’s Compliance Hotline at (608) 640-4050 or email the Compliance Mailbox. For technical questions or issues with purchasing and downloading the forms on our website, please contact Jeff Bonk.
Compliance Roundtable – February 18 (Webinar)
Join The League’s compliance team as they lead a discussion on the latest changes in regulations and need to know information to keep your credit union in compliance. You can find more information or register on our website.